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subcontractor subject to this title (said sections). In the interest of economy and the avoidance of duplication of inspection and audit, the services of the Bureau of Internal Revenue shall, upon the request of the Board and the approval of the Secretary of the Treasury, be made available to the extent determined by the Secretary of the Treasury for the purpose of making examinations and audits under this title ( said sections). (f) Minimum amounts subject to renegotiation. (1) Aggregate amounts received or accrued during fis

cal year. If the aggregate of the amounts received or accrued during a fiscal year (and on or after the applicable effective date specified in section 102(a) (section 1212(a) of this Appendix]) by a contractor or subcontractor, and all persons under control of or controlling or under common control with the contractor or subcontractor, under contracts with the Departments and subcontracts described in section 103(g) (1) and (2) (section 1213 (g) (1), (2) of this Appendix), is not more than $250,000, in the case of a fiscal year ending before June 30, 1953, or $500,000, in the case of a fiscal year ending on or after June 30, 1953, or $1,000,000, in the case of a fiscal year ending after June 30, 1956, the receipts or accruals from such contracts and subcontracts shall not, for such fiscal year, be renegotiated under this title (sections 1211 to 1224 of this Appendix). If the aggregate of such amounts received or accrued during the fiscal year under such contracts and subcontracts is more than $250,000, in the case of a fiscal year ending before June 30, 1953, or $500,000, in the case of a fiscal year ending on or after June 30, 1953, or $1,000,000, in the case of a fiscal year ending after June 30, 1956, no determination of excessive profits to be eliminated for such year with respect to such contracts and subcontracts shall be in an amount greater than the amount by which such aggregate exceeds $250,000, in the case of a fiscal year ending before June 30, 1953, or $500,000, in the case of a fiscal year ending on or after June 30, 1953, or $1,000,000, in the case of a fiscal year ending after June 30, 1956. (2) Subcontracts described in section 1213(g)(3) of

this Appendix. If the aggregate of the amounts received or accrued during a fiscal year (and on or after the applicable effective date specified in section 102(a) (section 1212(a) of this Appendix)) by a subcontractor, and all persons under control of or controlling or under common control with the subcontractor, under subcontracts described in section 103(g) (3) (section 1213(g) (3) of this Appendix] is not more than $25,000, the receipts or accruals from such subcontracts shall not, for such fiscal year, be renegotiated under this title (sections 1211 to 1224 of this Appendix). If the aggregate of such amounts received or accrued during the fiscal year under such subcontracts is more than $25,000, no determination of excessive profits to be eliminated for such year with respect to such subcontracts shall be in an amount greater than the amount by which such aggregate exceeds $25,000.

(3) Computation.

In computing the aggregate of the amounts received or accrued during any fiscal year for the purposes of paragraph (1) of this subsection, there shall be eliminated all amounts received or accrued by a contractor or subcontractor from all persons under control of or controlling or under common control with the contractor or subcontractor and all amounts received or accrued, by each such person from such contractor or subcontractor and from each other such person. If the fiscal year is a fractional part of twelve months, the $250,000 amount, the $500,000 amount, the $1,000,000 amount, and the $25,000 amount shall be reduced to the same fractional part thereof for the purposes of paragraphs (1) and (2) of this subsection. In the case of a fiscal year beginning in 1950 and ending in 1951, the $250,000 amount and the $25,000 amount shall be reduced to an amount which bears the same ratio to $250,000 or $25,000, as the case may be, as the number of days in such fiscal year after December 31, 1950, bears to 365, but this sentence shall have no application if the contractor or subcontractor has made an agreement with the Board pursuant to section 102(c) (section 1212(c) of this Appendix) for the application of the provisions of this title [sections 1211 to 1224 of this Appendix] to receipts or accruals prior to January 1, 1951, during such fiscal year. In the case of a fiscal year beginning on or before the termination date and ending after the termination date, the $1,000,000 amount and the $25,000 amount shall be reduced to an amount which bears the same ratio to $1,000,000 or $25,000, as the case may be, as the number of days in such fiscal year before the close of the termination date bears to 365. (Mar. 23, 1951, ch. 15, title I, § 105, 65 Stat. 12; Sept. 1, 1954, ch. 1209, $$ 2, 7(a), 68 Stat. 1116, 1118; Aug. 1, 1956, ch. 821, $ $ 5 (a)-(c), 6, 7(a), 70 Stat. 787; June 11, 1960, Pub. L. 86–507, 8 1(39), 74 Stat. 202; July 3, 1962, Pub. L. 87-520, $ 2(c), 76 Stat. 134; Oct. 24, 1968, Pub. L. 90–634, title I, § 103, 82 Stat. 1345.)

AMENDMENTS 1968–Subsec. (e) (1). Pub. L. 90–634 added the provision that any person who, but for section 160(c) (1) (A) (section 1216(e) (1) (A) of this Appendix), would not be relleved for a fiscal year from the filing requirements of the first sentence of this par. by reason of the preceding sentence shall furnish for such fiscal year such information with respect to the application of such provisions (and with respect to the aggregate specified in the preceding sentence) as the Board may by regulations prescribe as necessary to carry out this title (sections 1211—1224 of this Appendix).

1962—Subsec. (b)(2). Pub. L. 87-520 deleted last sentence prohibiting accrual of interest after three years from the date of filing a petition with the Tax Court pursuant to section 1218 of this Appendix in any case in which there has not been a final determination by the Tax Court with respect to such petition within such three-year period.

1960_Subsec. (a). Pub. L. 86-507 inserted "or by certified mall" following "registered mall" in two instances.

1956–Subsec. (c). Act Aug. 1. 1956. $5 (b), (c). provided that the one year period for commencement of proceedings shall not apply in the case of fraud or malfeasance or willful misrepresentation of a material fact.

Subsec. (e) (1). Act Aug. 1, 1956, $ 5(a), eliminated the mandatory filing of a financial statement by any person with respect to a fiscal year if the aggregate of the amounts received or accrued during the fiscal year by that person, and all persons under control of or controlling or under common control with him, is not more than the applicable amount prescribed in subsec. (1) (1) or (2), granted that person the right to elect to file a financial statement, granted the Board power to request information, records or data from any person whether or not that person filed a financial statement, and prohibited the request for information, records or data with respect to any fiscal year after the date on which all liabilities of the person for excessive profits received or accrued during that fiscal year are discharged,

Subsec. (1) (1). Act Aug. 1, 1956, $ 6(a), increased the minimum amount subject to renegotiation from $500.000 to $1,000,000 for fiscal years ending after June 30, 1956.

Subsec. (1) (3). Section 6(b) of act Aug. 1, 1956, provided for the reduction of the $1,000,000 amount where the fiscal year is a fractional part of twelve months, and for prorating the $1,000,000 amount and the $25,000 amount where the fiscal year begins on or before the termination date and ends after the termination date. Section 7(a) of act Aug. 1, 1956, omitted provisions which, for the purposes of subsec. (1) (2), permitted exclusion of amounts received or accrued by a contractor or subcontractor from all persons under control of or controlling or under common control with the contractor or subcontractor and all amounts received or accrued by each such person from that contractor or subcontractor and from each other such person.

1954-Subsec. (d). Act Sept. 1, 1954, $ 7(a), gave Loard power to declare agreements void.

Subsecs. (f) (1). (3). Act Sept. 1, 1954, $ 2, increased the minimum amount subject to renegotiation from $250,000 to $500,000 for fiscal years ending on or after June 30, 1953.

EFTECTIVE DATE OF 1968 AMENDMENT Amendment by Pub. L. 90–634 applicable with respect to amounts received or accrued in fiscal years of contractors and subcontractors ending after Oct. 24, 1968, see section 105 of Pub. L. 90-634, set out as a note under section 1212 of this Appendix.

EFFECTIVE DATE OF 1962 AMENDMENT Section 2(d) of Pub. L. 87-520 provided that: “The amendments made by this section (to subsec. (b) (2) of this section and sections 1218 and 1218a of this Appendix) shall apply only with respect to cases in which the petition for redetermination is filed with the Tax Court of the United States after the date of the enactment of this Act (July 3, 1962)."

EFFECTIVE DATE OF 1956 AMENDMENT Section 5 (d) of act Aug. 1, 1956, provided that: “The amendments made by subsections (a), (b), and (c) (to subsecs. (c) and (e) (1)) shall apply only with respect to fiscal years (as defined in section 103 (h) of such Act (section 1213(h) of this Appendix] ending after June 30, 1956."

Section 7 (b) of act Aug. 1, 1956, provided that: “The amendment made by subsection (a) (to subsec. (f) (3)] shall apply only with respect to fiscal years (as defined in scection 103 (h) of such Act (section 1213 (h) of this Appendix) ending on or after June 30, 1956."

EFFECTIVE DATE OF 1954 AMENDMENT Section 7 (b) of act Sept. 1, 1954, provided that the amendment of subsec. (d) should take effect as if it had been a part of this section when enacted on Mar. 23, 1951.

CHANGE OF NAME The name of the Tax Court of the United States, relerred to in text, was changed to the United States Tax Court by Pub. L. 91–172, title IX, $ 951 et seq., Dec, 30, 1969, 83 Stat. 730, which changed the status of that Court to a constitutional court of record.

The official title of the Bureau of Internal Revenue was changed to the Internal Revenue Service by Treas. Dept. Order 150-29, eft. July 9, 1963.

SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in sections 1211 to 1214, 1216 to 1224 of this Appendix.

8 1216. Exemptions.
(a) Mandatory exemptions.

The provisions of this title (sections 1211 to 1224 of this Appendix) shall not apply to

(1) any contract by a Department with any Territory, possession, or State, or any agency or political subdivision thereof, or with any foreign government or any agency thereof; or

(2) any contract or subcontract for an agricultural commodity in its raw or natural state, or if the commodity is not customarily sold or has not an established market in its raw or natural state, in the first form or state, beyond the raw or natural state, in which it is customarily sold or in which it has an established market. The term "agricultural commodity" as used herein shall include but shall not be limited to

(A) commodities resulting from the cultivation of the soil such as grains of all kinds, fruits, nuts, vegetables, hay, straw, cotton, tobacco, sugarcane, and sugar beets;

(B) natural resins, saps, and gums of trees;

(C) animals, such as cattle, hogs, poultry, and sheep, fish and other marine life, and the produce of live animals, such as wool, eggs, milk and cream; or

(3) any contract or subcontract for the product of a mine, oil or gas well, or other mineral or natural deposit, or timber, which has not been processed, refined, or treated beyond the first form or state suitable for industrial use; or

(4) any contract or subcontract with a common carrier for transportation, or with a public utility for gas, electric energy, water, communications, or transportation, when made in either case at rates not in excess of published rates or charges filed with, fixed, approved, or regulated by a public regulatory body, State, Federal, or local, or at rates not in excess of unregulated rates of such a public utility which are substantially as favorable to users and consumers as are regulated rates. In the case of the furnishing or sale of transportation by common carrier by water, this paragraph shall apply only to such furnishing or sale which is subject to the jurisdiction of the Interstate Commerce Commission under Part III of the Interstate Commerce Act (chapter 12 of Title 49] or subject to the jurisdiction of the Federal Maritime Board under the Intercoastal Shipping Act, 1933 (chapter 23A of Title 46) and to such furnishing or sale in any case in which the Board finds that the regulatory aspects of rates for such furnishing or sale, or the type and nature of the contract for such furnishing or sale, are such as to indicate, in the opinion of the Board, that excessive profits are improbable; or

(5) Any contract or subcontract with an organization exempt from taxation under section 101 (6) of the Internal Revenue Code (section 101 (6) of Title 26. I.R.C. 1939), but only if the income from such contract or subcontract is not includible under section 422 of such code (section 422 of Title 26, I.R.C. 1939) in computing the unrelated business net income of such organization; or

(6) any contract which the Board determines does not have a direct and immediate connection with the national defense. The Board shall prescribe regulations designating those classes and types of contracts which shall be exempt under this paragraph; and the Board shall, in accordance with regulations prescribed by it, exempt any individual contract not falling within any such class or type if it determines that such contract does not have a direct and immediate connection with the national defense. In designating those classes and types of contracts which shall be exempt and in exempting any individual contract under this paragraph, the Board shall consider as not having a direct or immediate connection with national defense any contract for the furnishing of materials or services to be used by the United States, a Department or agency thereof, in the manufacture and sale of synthetic rubbers to a private person or to private persons which are to be used for nondefense purposes. If the use by such private person or persons shall be partly for defense and partly for nondefense purposes, the Board shall consider as not having a direct or immediate connection with national defense that portion of the contract which is determined not to have been used for national defense purposes. The method used in making such determination shall be subject to approval by the Board. Notwithstanding section 108 of this title (section 1218 of this Appendix), regulations prescribed by the Board under this paragraph, and any determination of the Board that a contract is or is not exempt under this paragraph shall not be reviewed or redetermined by the Tax Court or by any other court or agency; or

(7) any subcontract directly or indirectly under a contract or subcontract to which this title (sections 1211 to 1224 of this Appendix] does not apply by reason of any paragraph, other than paragraph (1), (5), or (8), of this subsection; or

(8) Repealed. Aug. 1, 1946, ch. 821, $ 9(a), 70 Stat. 789.

(9) any contract, awarded as a result of competitive bidding, for the construction of any building, structure, improvement, or facility, other than a contract for the construction of housing financed with a mortgage or mortgages insured under the provisions of title VIII of the National Housing Act, as now or hereafter amended (section 1748 et

seq. of Title 12]. (b) Cost allowance.

In the case of a contractor or subcontractor who produces or acquires the product of a mine, oil or gas well, or other mineral or natural deposit, or timber, and processes, refines, or treats such a product to and beyond the first form or state suitable for industrial use, or who produces or acquires an agricultural product and processes, refines, or treats such a product to and beyond the first form or state in which it is customarily sold or in which it has an established market, the Board shall prescribe such regulations as may be necessary to give such contractor or subcontractor a cost allowance substantially equivalent to the amount which would have

been realized by such contractor or subcontractor if he had sold such product at such first form or state. Notwithstanding any other provisions of this title [sections 1211 to 1224 of this Appendix), there shall be excluded from consideration in determining whether or not a contractor or subcontractor has received or accrued excessive profits that portion of the profits, derived from receipts and accruals subject to the provisions of this title [said sections), attributable to the increment in value of the excess inventory. For the purposes of this subsection the term "excess inventory" means inventory of products, hereinbefore described in this subsection, acquired by the contractor or subcontractor in the form or at the state in which contracts for such products on hand or on contract would be exempted from this title (said sections) by subsection (a) (2) or (3) of this section, which is in excess of the inven. tory reasonably necessary to fulfill existing contracts or orders. That portion of the profits, derived from receipts and accruals subject to the provisions of this title (said sections), attributable to the increment in value of the excess inventory, and the method of excluding such portions of profits from consideration in determining whether or not the contractor or subcontractor has received or accrued excessive profits, shall be determined in accordance with regulations prescribed by the Board. (c) Partial mandatory exemption for durable produc

tive equipment. (1) Receipts and accruals.

The provisions of this title (sections 1211 to 1224 of this Appendix) shall not apply to receipts or accruals (other than rents) from contracts or subcontracts for new durable productive equipment, except (A) to that part of such receipts or accruals which bears the same ratio to the total of such receipts or accruals as five years bears to the average useful life of such equipment as set forth in Bulletin F of the Bureau of Internal Revenue (1942 edition), or, if an average useful life is not so set forth, then as estimated by the Board and (B) to receipts and accruals from contracts for new durable productive equipment in cases in which the Board finds that the new durable productive equipment covered by such contracts cannot be adapted, converted, or retooled for commercial use. (2) Definitions.

For the purpose of this subsection, the term "durable productive equipment” means machinery, tools, or other productive equipment, which has an average useful life of more than five years. (d) Permissive exemptions.

The Board is authorized, in its discretion, to exempt from some or all of the provisions of this title (sections 1211 to 1224 of this Appendix]—

(1) any contract or subcontract to be performed outside of the territorial limits of the continental United States or in Alaska; (2) any

contracts subcontracts under which, in the opinion of the Board, the profits can be determined with reasonable certainty when the contract price is established, such as certain classes of (A) agreements for personal services or for the purchase of real property.

or

perishable goods, or commodities the minimum price for the sale of which has been fixed by a public regulatory body, (B) leases and license agreements, and (C) agreements where the period of performance under such contract or subcontract will not be in excess of thirty days.

(3) any contract or subcontract or performance thereunder during a specified period or periods if, in the opinion of the Board, the provisions of the contract are otherwise adequate to prevent excessive profits;

(4) any contract or subcontract the renegotiation of which would jeopardize secrecy required in the public interest;

(5) any subcontract or group of subcontracts not otherwise exempt from the provisions of this section, if, in the opinion of the Board, is not administratively feasible in the case of such subcontract or in the case of such group of subcontracts to determine and segregate the profits attributable to such subcontract or group of subcontracts from the profits attributable to activi

ties not subject to renegotiation. The Board may so exempt contracts and subcontracts both individually and by general classes or types. (e) Mandatory exemption for standard commercial

articles and services. (1) Articles and services.

The provisions of this title (sections 1211 to 1224 of this Appendix) shall not apply to amounts received or accrued in a fiscal year under any contract or subcontract for an article or service which (with respect to such fiscal year) is

(A) a standard commercial article; or

(B) a service which is a standard commercial service or is reasonably comparable with a stand

ard commercial service. (2) Classes of articles.

The provisions of this title (sections 1211 to 1224 of this Appendix) shall not apply to amounts received or accrued in a fiscal year under any contract or subcontract for an article which (with respect to such fiscal year) is an article in a standard commercial class of articles. (3) Applications.

Paragraph (1) (B) and paragragh (2) shall apply to amounts received or accrued in a fiscal year under any contract or subcontract for an article or service only if

(A) the contractor or subcontractor at his election files, at such time and in such form and detail as the Board shall by regulations prescribe, an application containing such information and data as may be required by the Board under its regulations for the purpose of enabling it to make a determination under the applicable paragraph,

(i) in the case of paragraph (2), six months; or

(iii) in either case, any longer period stipu

lated by mutual agreement. (4) Definitions. For the purposes of this subsection

(A) the term "article" includes any material, part, component, assembly, machinery, equipment, or other personal property;

(B) the term "standard commercial article" means, with respect to any fiscal year, an article

(1) which either is customarily maintained in stock by the contractor or subcontractor or is offered for sale in accordance with a price schedule regularly maintained by the contractor or subcontractor,

(11) the price of which under any contract or subcontract subject to this title (sections 1211 to 1224 of this Appendix] is not in excess of the lowest price at which such article is sold in similar quantity by the contractor or subcontractor for civilian industrial or commercial use, except for any excess attributable to the cost of accelerated delivery or other significantly different circumstances, and

(iii) from the sales of which by the contractor or subcontractor at least 55 percent of the receipts or accruals in such fiscal year are not (without regard to this subsection and subsection (c) of this section) subject to this title [sections 1211 to 1224 of this Appendix];

(C) the term "service" means any processing or other operation performed by chemical, electrical, physical, or mechanical methods directly on materials owned by another person;

(D) the term “standard commercial service" means, with respect to any fiscal year, a service

(1) the price of which under any contract or subcontract subject to this title (sections 1211 to 1224 of this Appendix] is not in excess of the lowest price at which such service is performed under similar circumstances by the contractor or subcontractor for civilian Industrial or commercial purposes, and

(11) from the performance of which by the contractor or subcontractor at least 55 percent of the receipts or accruals in such fiscal year are not (without regard to this subsection, subject to this title (sections 1211 to 1224 of this Appendix);

(E) a service is, with respect to any fiscal year "reasonably comparable with a standard commercial service" only if

(i) such service is of the same or a similar kind, performed with the same or similar materials, and has the same or a similar result, without necessarily involving identical operations, as a standard commercial service from the performance of which the contractor or subcontractor has receipts or accruals in such fiscal year,

(1i) the price of such service under any contract or subcontract subject to this title (sections 1211—1224 of this Appendix] is not in excess of the lowest price at which such service is performed under similar circumstances by

and

(B) The Board determines that such article or service is, or fails to determine that such article or service is not, an article or service to which such paragraph applies, within the following periods after the date of filing such application:

(i) in the case of paragraph (1)(B), three months;

the contractor or subcontractor for civilian industrial or commercial purposes, and

(iii) at least 55 percent of the aggregate receipts or accruals in such fiscal year by the contractor or subcontractor from the performance of such service and such standard commercial service are not (without regard to this subsection) subject to this title (sections 1211 to 1224 of this Appendix]; and

(F) the term "standard commercial class of articles” means, with respect to any fiscal year, two or more articles with respect to which the following conditions are met:

(i) at least one of such articles either is customarily maintained in stock by the contractor or subcontractor or is offered for sale in accordance with a price schedule regularly maintained by the contractor or subcontractor,

(ii) all of such articles are of the same kind and manufactured of the same or substitute materials (without necessarily being of identical specifications),

(iii) the price of each of such articles under any contract or subcontract subject to this title [sections 1211 to 1224 of this Appendix] is not in excess of the lowest price at which such article is sold in similar quantity by the contractor or subcontractor for civilian industrial or commercial use, except for any excess attributable to the cost of accelerated delivery or other significantly different circumstances,

(iv) all of such articles are sold at reasonably comparable prices, and

(v) at least 55 percent of the aggregate receipts or accruals in such fiscal year by the contractor or subcontractor from sales of all such articles are not (without regard to this subsection and subsection (c) of this section) subject

to this title. (5) Waiver of exemption.

Any contractor or subcontractor may waive the exemption provided in paragraphs (1) and (2) with respect to his receipts or accruals in any fiscal year from sales of any article or service by including a statement to such effect in the financial statement Aled by him for such fiscal year pursuant to section 105 (e) (1) (section 1215 (e) (1) of this Appendix), without necessarily waiving such exemption with respect to receipts or accruals in such fiscal year from sales of any other article or service. A waiver, if made, shall be unconditional, and no waiver may be made without the permission of the Board for any receipts or accruals with respect to which the contractor or subcontractor has previously filed an application under paragraph (3). (6) Nonapplicability during national emergencies.

Paragraphs (1) and (2) shall not apply to amounts received or accrued during a national emergency proclaimed by the President, or declared by the Congress, after the date of the enactment of the Renegotiation Amendments Act of 1956 (August 1, 1956). (Mar. 23, 1951, ch. 15, title I, $ 106, 65 Stat. 17; Sept. 1, 1954, ch. 1209, $$ 3 (a), 4 (a)-(c), 5(a), 6(a), 68 Stat. 1116, 1118; Aug. 3, 1955, ch. 499, $$ 3(a), 4(a), 5(a), 69 Stat. 447, 448; Aug. 1,

1956, ch.821, $$ 8(a), 9(a), 70 Stat. 789; Oct. 24, 1968, Pub. L. 90-634, title I, $ 104, 82 Stat. 1345.)

AMENDMENTS 1968–Subsec. (e) (1) (A). Pub. L. 90-634, $ 104(a) (1) (B), added “or" following "article;".

Subsec. (e) (1) (B). Pub. L. 90-634, $ 104(a) (1) (A), (C), redesignated subsec. (e) (1) (C) es (e) (1) (B). For. mer subsec. (e) (1) (B), which related to an article which is identical in every material respect with a standard commercial article, was struck out.

Subsec. (e) (1) (C). Pub. L. 90-634, $ 104(a)(1)(C). redesignated subsec. (e) (1) (C) as (e) (1) (B).

Subsec. (e) (3). Pub. L. 90-634, § 104(a) (2), struck out all references to subsec. (e) (1) (C) of this section.

Subsec. (e) (4). Pub. L. 90-634, $ 104(b), reenacted without change the definitions of the terms "article" and "service", amended the definitions of the terms "standard commercial article", "standard commercial service", "reasonably comparable with a standard commercial service". and "standard commercial class of articles”, and struck out the definition of the term "Identical in every material respect with a standard commercial article".

1956–Subsec. (a) (7). Act Aug. 1, 1956, $ 8(a), substituted "other than paragraph (1), (5), or (8)" for "other than paragraph (8)".

Subsec. (a) (8). Act Aug. 1, 1956, $ 9(a), repealed subsec. (a) (8), which provided for a mandatory exemption for standard commercial articles and services. Subject matter is now covered by subsec. (e) of this section.

Subsec. (e). Act Aug. 1, 1956, $ 9(a), added subsec. (e).

1955–Subsec. (a) (8). Act Aug. 3, 1955, $ 3(a), added the term "standard commercial service" and the definitions of "service", "standard commercial service"; and "reasonably comparable" to exempt contracts and subcontracts for the making or furnishing of a standard commercial service.

Subsec. (a) (9). Act Aug. 3, 1955, $ 4(a), added subsec. (a) (9).

Subsec. (c) (2). Act Aug. 3, 1955, $ 5(a), granted exemptions to manufacturers who sell items of durable productive equipment to other manufacturers who incorporate it in equipment sold to the Government.

1954-Subsec. (a) (4). Act Sept. 1, 1954, $ 6(a), added to last sentence "and to such furnishing • • profits are improbable; or".

Subsec. (a) (6). Act Sept. 1, 1954, $ 3(a), included synthetic rubber within exemptions.

Subsec. (a) (7). Act Sept. 1, 1954, $ 5(a) (1), substituted "by reason of any paragraph, other than paragraph (8), of this subsection; or".

Subsec. (a) (8). Act Sept. 1, 1954, $ 5(a) (2), added subsec. (a) (8).

Subsec. (c). Act Sept. 1, 1954, § 4 (a)-(C), made section applicable to prime contracts as well as subcontracts, and redefined "durable productive equipment".

EFFECTIVE DATE OF 1968 AMENDMENT Amendment by Pub. L. 90–634 applicable with respect to amounts received or accrued in fiscal years of contractors and subcontractors ending after Oct. 24, 1968, see section 105 of Pub. L. 90-634, set out as a note under section 1212 of this Appendix.

EFFECTIVE DATE OF 1956 AMENDMENT Section 8 (b) of act Aug. 1, 1956, provided that: “The amendment made by subsection (a) (to subsec. (a) (7)) shall apply only with respect to subcontracts made after June 30, 1956."

Section 9 (c) of act Aug. 1, 1956, provided that: “The amendments made by this section (to sections 1212 (e) and 1216 (e) of this Appendix) shall apply only with respect to fiscal years (as defined in section 103 (h) of such Act (section 1213 (h) of this Appendix]) ending after June 30, 1956."

EFFECTIVE DATE OF 1955 AMENDMENT Section 3 (b) of act Aug. 3, 1955, provided that the amendment to subsec. (a) (8) should apply to contracts with the Departments and subcontracts only to the extent of the amounts received or accrued by a contractor or subcontractor after Dec. 31, 1953.

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