THE UNITED STATES OF AMERICA 1775
Headquarters
Department of the Army
Washington, DC
9 January 2023
Army Regulation 702–20
Effective 9 February 2023

Product Assurance

Counterfeit Risk Management Product Assurance

By Order of the Secretary of the Army:

JAMES C. MCCONVILLE
General, United States Army
Chief of Staff

Official:

MARK F. AVERILL
Administrative Assistant to the
Secretary of the Army

History. This publication is a new regulation.

Authorities. This regulation implements DoDI 4140.67.

Applicability. This regulation applies to the Regular Army, the Army National Guard/Army National Guard of the United States, and the U.S. Army Reserve, unless otherwise stated.

Proponent and exception authority. The proponent of this regulation is the Assistant Secretary of the Army (Acquisition, Logistics and Technology). The proponent has the authority to approve exceptions or waivers to this publication that are consistent with controlling law and regulations. The proponent may delegate this approval authority, in writing, to a division chief within the proponent agency or its direct reporting unit or field operating agency in the grade of colonel or the civilian equivalent. Activities may request a waiver to this publication by providing justification that includes a full analysis of the expected benefits and must include formal review by the activity's senior legal officer. All waiver requests will be endorsed by the commander or senior leader of the requesting activity and forwarded through their higher headquarters to the policy proponent. Refer to AR 25–30 for specific requirements.

Army internal control process. This regulation contains internal control provisions in accordance with AR 11–2 and identifies key internal controls that must be evaluated (see app B).

Suggested improvements. Users are invited to send comments and suggested improvements on DA FormDA FormDepartment of the Army form 2028 (Recommended Changes to Publications and Blank Forms) directly to the Assistant Secretary of the Army (Acquisition, Logistics and Technology) (SAAL–IB), usarmy.pentagon.hqda-asa-alt.list.saal-lp@army.mil.

Distribution. This publication is available in electronic media only and is intended for the Regular Army, the Army National Guard/Army National Guard of the United States, and the U.S. Army Reserve.

AR 702–20 • 9 January 2023

UNCLASSIFIED

Approved supplier Suppliers that are assessed and determined to provide acceptable fraudulent/counterfeit parts risk mitiga- tion process.

Authorized supplier See DFARS 252.246 – 7008(a).

Commercial off-the-shelf item A product, material, component, subsystem, or system sold or traded to the general public in the course of normal business operations at prices based on established catalog or market prices (see MIL – STD – 130N).

Counterfeit material See DoDI 4140.67.

Counterfeit part A fraudulent part that has been confirmed to be a copy, imitation, or substitute that has been represented, identified, or marked as genuine and/or altered by a source without legal right with intent to mislead, de- ceive, or defraud. A suspect part may be determined to be fraudulent or counterfeit through further evalu- ation and testing. All counterfeit parts are fraudulent, but not all fraudulent parts are counterfeit.

Critical component See DoDI 5200.44.

Critical safety item See DoDI 4140.67.

Diminishing manufacturing sources and material shortages The loss or impending loss of the last known manufacturer or supplier of raw materials, production parts, or repair parts.

Electronic part See DFARS 252.246 – 7008(a).

Engineering support activity See DoDI 4140.67.

Government-Industry Data Exchange Program See DoDI 4140.67.

Information-communication technology See DoDI 5200.44.

Item A single hardware article or a single unit formed by a grouping of subassemblies, components, or constit- uent parts.

Manufacturer An individual, company, corporation, firm, or government activity who controls the production of an item; or produces an item from crude or fabricated materials; or assembles materials or components or parts, with or without modification, into a more complex item.

Materiel See DoDI 4140.67.

Materiel developer See AR 750 – 1.

Nonconforming part A product or the component of a product that has not been manufactured, assembled, tested, or in- spected in accordance with the terms of a contract, its specifications, or drawings, including military speci- fications.

Original component manufacturer See DFARS 252.246 – 7008(a).

Original equipment manufacturer See DFARS 252.246 – 7008(a).

Original manufacturer See DFARS 252.246 – 7008(a).

Part See AR 750 – 1.

Product quality deficiency A defect or nonconforming condition detected on new or newly reworked government ‑ owned products, premature equipment failures, and products in use that do not fulfill their expected purpose, operation, or service due to deficiencies in design, specification, materiel, manufacturing, and workmanship.

Product quality deficiency report See AR 702 – 7 – 1. The format used to record and transmit product quality deficiency data.

Program protection The DoD’s integrating process for mitigating and managing risks to advanced technology and mission- critical system functionality from foreign collection, design vulnerability, or supply chain exploitation/inser- tion, battlefield loss, and unauthorized or inadvertent disclosure throughout the acquisition life cycle.

Remedies Criminal, civil, contractual, and administrative actions that will be initiated by a commander or official hav- ing responsibility over a matter central to a significant procurement fraud case in order to protect DoD in- terests and to deter future incidents of fraudulent conduct.

Restitution See DoDI 4140.67.

Risk-based approach See DoDI 4140.67.

Subcontractor Any supplier, distributor, vendor, or firm that furnishes supplies or services to or for the contractor or an- other subcontractor under this contract.

Supply chain See DoDI 4140.67.

Supply chain traceability Documented evidence of a part’s supply chain history. This refers to documentation of all supply chain intermediaries and significant handling transactions, such as from OCM to distributor, or from excess in- ventory to broker to distributor.

Suspect A part in which there is an indication that it may have been misrepresented by the supplier or manufac- turer and may meet the definition of fraudulent part or counterfeit part.

Suspect counterfeit See DoDI 4140.67.

Suspect counterfeit electronic part See DFARS 252.246 – 7007(a).

Suspect item An item in which visual inspection, testing, or other means indicate that it may not conform to established Government or industry-accepted specifications or national consensus standards, or one whose docu- mentation, appearance, performance, material, or other characteristics may have been misrepresented by the supplier or manufacturer.

Traceability See DoDI 4140.67.

Trusted systems networks The integration of systems engineering, supply chain risk management, security, counterintelligence, in- telligence, information assurance, hardware and software assurance, and information systems security engineering disciplines into a single overarching strategy.

Unique item identifier See DoDI 4140.67.

SUMMARY AR 702 – 20 Counterfeit Risk Management Product Assurance This new Department of the Army regulation, dated 9 January 2023— • Prescribes policy for the mandatory procedures assigned in DA PamDA PamDepartment of the Army Pamphlets 702 – 20 (throughout). • Establishes Army policy to identify and report counterfeit material (throughout). • Assigns responsibilities to principal officials, commanders, and leaders with roles in the prevention of counterfeit activities (chap 1).