Sec.

1 Creation and authority.

2 Purpose.

3 Organization.

4 Activities.

5 Official copies.

8 Copies of the Renegotiation Board regulations.

1 Creation and authority.-The Renegotiation Board was created by the Renegotiation Act of 1951 (65 Stat. 7, 50 U. S. C. App. 1211) as an independent establishment in the executive branch of the Government and was organized on October 8, 1951 to administer such act. The Renegotiation Act of 1951 transferred to The Renegotiation Board certain powers, functions and duties conferred upon the War Contracts Price Adjustment Board by the Renegotiation Act (58 Stat. 78, as amended; 50 U. S. C. App. 1191). In addition, the Secretary of Defense delegated to The Renegotiation Board, effective January 20, 1952 (17 F. R. 736), all powers, functions and duties conferred upon the Secretary of Defense by the Renegotiation Act of 1948 (62 Stat. 259, as amended and extended; 50 U. S. C. App. 1193).

2 Purpose.-The objective of the Renegotiation Act of 1951 and the previous renegotiation statutes is to eliminate excessive profits derived by contractors and subcontractors in connection with the national defense program.

3 Organization.-(a) The Renegotiation Board is composed of five members. Each is appointed by the President by and with the advice and consent of the Senate. The Secretaries of the Army, the Navy and the Air Force, subject to the approval of the Secretary of Defense, and the Administrator of General Services each recommend to the President for his consideration one person from civilian life to serve as a member of the Board. The President designates one member to serve as Chairman. The

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principal office of the Board is located at 1910 K Street NW., Washington 25, D.C.

(b) The Board maintains two regional boards with authority to conduct renegotiation proceedings in cases assigned to them. Each of the regional boards is composed of a chairman and additional board members as appointed by the Board. After the Board determines that a contractor should be assigned for renegotiation, the case is assigned to a regional board selected according to its proximity, its relative work load, and its experience and special skills. The locations of the regional boards are as follows:

Location

(1) Eastern Regional Renegotiation Board, 1634 Eye Street NW., Washington 25, D.C.

(2) Western Regional Renegotiation Board, 5504 Hollywood Boulevard, Los Angeles 28, Calif.

4 Activities.-(a) The Renegotiation Act of 1951 is applicable to contracts with the military departments and certain other agencies of the Government named in the act, and to related subcontracts. As originally enacted, the act applied also to contracts with such other agencies of the Government exercising functions having a direct and immediate connection with the national defense as the President might designate. Various additional agencies were designated by the President in Executive Orders 10260, June 27, 1951 (16 F. R. 6271); 10294, September 28, 1951 (16 F. R. 9927); 10299, October 31, 1951 (16 F. R. 11135); 10367, June 30, 1952 (17 F. R. 5932); and 10567, September 29, 1954 (F. R. 6361).

(b) By amendment to the act effective December 31, 1956, all agencies so named or designated ceased to be "Departments" for the purposes of the act, except the Departments of Defense, Army, Navy and Air Force, the

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Maritime Administration, the Federal Maritime Board, the General Services Administration, and the Atomic Energy Commission. The President was given the power, during a national emergency proclaimed by the President or declared by the Congress after the date of such amendment, to designate as a Department any other agency of the Government exercising functions having a direct and immediate connection with the national defense, any such designation ceasing to be in effect on the last day of the month during which such emergency is terminated. By amendment approved September 6, 1958, the National Aeronautics and Space Administration was added as a Department under the act.

(c) For fiscal years ending on or before June 30, 1956, every contractor is required to file an annual report with respect to its receipts or accruals from renegotiable prime contracts and subcontracts during its fiscal year. For fiscal years ending after June 30, 1956, this report is required to be filed only by those contractors whose renegotiable sales exceed the minimum amount prescribed in the act, but it may be filed by any other contractor. The mandatory filing includes detailed financial and other information. Additional pertinent information is accumulated by the Board in the course of meetings with contractors whose renegotiable sales exceed the statutory minimum. If the Board and the contractor are unable to agree upon the amount of excessive profits, if any, to be refunded by the contractor for such fiscal year, the Board issues and enters an order determining such amount. The order is reviewable in The Tax Court of the United States.

(d) Cases are normally assigned in the first instance to one of the regional boards, to which the Board has delegated authority to make determinations of excessive profits in cases involving a net profit on renegotiable business not in excess of $800,000 for a fiscal year and to make recommended determinations to the Board of excessive profits in cases exceeding that amount, for final determination by the Board.

(e) The administration of renegotiation agreements and orders under the Renegotiation

Act of 1951 is carried out by the heads of the agencies whose contracts are subject to such act; the administration of renegotiation agreements and orders under the Renegotiation Act of 1948 has been delegated to the Secretary of Defense, who in turn has redelegated such function to the Secretaries of the Army, the Navy, and the Air Force; the administration of renegotiation agreements and orders under the Renegotiation Act has been delegated to the heads of the agencies whose contracts were subject to the act.

(f) The Board maintains liaison with the various agencies whose contracts are subject to the Renegotiation Act of 1951, and with the Department of Justice, the Internal Revenue Service, and other agencies whose jurisdiction or activities relate to the functions of the Board. The Board also disseminates renegotiation results and information to Government procurement personnel for use in reprocurement, forward pricing and price redetermination proceedings, as a means of avoiding excessive profits to contractors and excessive costs to the Government in the execution of the national defense program.

5 Official copies.-Official copies of the statutes referred to herein may be obtained from the Superintendent of Documents, U. S. Government Printing Office, Washington 25, D. C. Official copies of Executive Orders cited herein are set out in the Federal Register, which may also be procured from the Superintendent of Documents.

6 Copies of the Renegotiation Board Regulations. The Renegotiation Board Regulations and current supplements thereto may be obtained from the Superintendent of Documents, U. S. Government Printing Office, Washington 25, D. C.

7 Seal. The seal of the Board shall be judicially noticed. A facsimile is set forth below:

Sec.

SCOPE OF REGULATIONS

SCOPE OF REGULATIONS

1451.1 Arrangement of regulations.-For purposes of the Code of Federal Regulations, the Renegotiation Board Regulations under the Renegotiation Act of 1951 have been assigned to Title 32, Chapter XIV, Subchapter B, comprising Parts 1450 to 1499, inclusive. The regulations in this subchapter are divided into parts, each one of which deals with a separate aspect of renegotiation; and each part is further subdivided into sections. The numbering of individual parts and sections is keyed to the numbering system of the Code of Federal

Regulations. The numbering is not necessarily consecutive and is designed to permit subsequent insertion of additional parts and sections. The first four digits of the number indicate the part number. The digit or digits following the decimal point indicate the number of the section within the part.

1451.2 Cross references.-Unless specifically stated otherwise, cross references in the regulations in this subchapter indicate parts or sections of the regulations in this subchapter.

1451.3 Citations.-The regulations in this subchapter shall be referred to as the Renegotiation Board Regulations, and any section may be cited as RBR followed by the section number. Thus, this section may be cited as RBR 1451.3.

1451.4 Applicability of regulations.-The applicability of the regulations in this subchapter shall be co-extensive with the applicability of Title I of the Renegotiation Act of 1951, and the regulations in this subchapter shall apply to all proceedings conducted under Title I of the act.

1451.5 Amendments and additions.-When amendments or additions to the regulations in this subchapter are adopted by the Board, such amendments or additions will become effective at once unless otherwise specified. The adoption of such amendments or additions will not affect the validity of any action theretofore taken in accordance with prior regulations.

DEFINITIONS

1451.11 "The 1951 act" and "the act.”The terms "the 1951 act" and "the act" mean the Renegotiation Act of 1951, as amended or supplemented.

1451.12 "The 1948 act."-The term "the 1948 act" means the Renegotiation Act of 1948, as amended or supplemented.

1451.13 "Board."-The term "Board" means The Renegotiation Board created by section 107 (a) of the act,

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