B. Definitions

Comments: Several respondents were concerned with the rule's use of the term "executive." Generally, the respondents believed that the rule's definition could cause non-executive employees to face public disclosure of their compensation. The respondents pointed out that the statute is limited to "officers," and urged the Councils to narrow the definition to "corporate officers" or "partners" of the company.

Response: The statute used both terms "officer" and "executive." To avoid any ambiguity, the FAR only uses "executive". The disclosure requirement is for the compensation of individuals who manage the contractor entity. Thus, the reporting requirement includes officers, executives, and other individuals who perform management functions for the contractor even though they may not have a formal title. By defining "executive" to mean officers, managing partners, or any other employees in management positions, the rule provides the contractor with the maximum flexibility to determine its executives for the purposes of the reporting requirements.

Comment: Several respondents requested that the Councils define "subaward" in a manner consistent with OMB Circular A-110 for an organization that receives Federal grants and contracts. A respondent preferred that the FAR follow the grants guidance, which would require incorporating into the FAR the definition of "subawards" in paragraph (ff) of section 2 of Appendix A to OMB Circular A-110, found at 2 CFR 215.2(ff).

Response: The term "subaward" does not require definition in the rule for the purpose of consistency with OMB Circular A-110(ff)/2 CFR 215.2(ff), which provides guidance to Federal agencies on the administration of grants to and agreements with institutions of higher education, hospitals, and other non-profit organizations. The term "subaward" is not used in the rule, and providing a definition for the term without using it as a function of the rule would not be prudent and could cause confusion.

Comment: A respondent requested that the Councils define the term "subcontract." The respondent stated that the term is only defined in FAR part 44. Another respondent was concerned that the definition of "first-tier subcontractor" differs from the definition used in the September 2007 clause, and noted the definition excluded contracts that provide supplies or services benefiting two or more contracts. The respondent recommended revising the definition of "first-tier subcontract" to mean "a subcontract awarded by a contractor solely and directly to furnish supplies or services (including construction) for the performance of a prime contract, but exclude supplier agreements that benefit two or more contracts." Another respondent believed that the definition for "first-tier subcontract" is unclear, overly broad, and requested that the definition be revised to emphasize that all vendor supply and service agreements are excluded from the rule.

Response: The term "subcontract" does not need to be defined, as the definition of "first-tier subcontract" is sufficient to meet the intended purpose of the Transparency Act. The specific changes of the definition of "first-tier subcontract" recommended by the respondents are not necessary, as the recommended changes may restrict the reporting of relevant first-tier subcontracts that should be reported. However, the Councils have made changes at 52.204-10(a) to ensure clarity, and to eliminate the potential that contractors may report long term vendor agreements for material or supplies, which are outside the scope of the core functions of a contractor's contract with the Government.

Comment: A respondent suggested that a definition of "month of award" be added to the rule.

Response: The Councils have added a definition of "month of award" at 52.204-10(a).

Comment: A respondent was concerned with how contracting officers are interpreting the rule's exclusion of classified contracts. The respondent indicated that contracting officers are interpreting the term to mean contracts where the document itself is classified. To ensure proper implementation of the exemption, the respondent recommended that the rule, in FAR 1.1401 and 1.1403, reference the FAR 2.101 definition for "classified contract."

Response: The Councils have revised the rule at FAR 4.1401, 4.1403 and 52.204-10(c) for consistency with the statute, which indicates that nothing in the statute requires disclosure of classified information.