G. Exclusions and Flowdown Requirement

Comments: One respondent expressed strong support for the $5 million threshold and the exclusions provided for prime contracts that are for commercial items or that will be performed entirely outside the U.S. This respondent also strongly supported the $5 million threshold for flowdown of the requirement to subcontracts, as well as the exclusion from the flowdown requirement for subcontracts that are for commercial items or that will be performed entirely outside the U.S. However, the respondent recommended that the flowdown requirement be further limited to first-tier subcontracts.

Response: DoD has adopted the same criteria for flowdown of the new clause at DFARS 252.203-7004, Display of Fraud Hotline Posters, as is used for the comparable clause at FAR 52.203-14, Display of Hotline Posters. Because DoD is using DFARS 252.203-7004 in lieu of the clause at FAR 52.203-14, DoD has retained the same criteria for flowdown to subcontractors.