Reconsideration of Deduction Action by GSA To Recover Carrier Overcharges

A firm requested a reconsideration of a GAO decision in which a deduction action taken by the General Services Administration (GSA) to recover overcharges collected by the firm in connection with the transportation of Foreign Military Sales (FMS) shipments was sustained. GAO held that the firm failed to rebut the presumption of fact that the government received the entire benefit of the lower rates. The presumption arose from the issuance of government bills of lading (GBL) and from payment of transportation charges from appropriated funds. The firm contended that the presumption was rebutted by the reimbursable nature of the FMS program. It contended that there was no evidence showing that the government was not reimbursed for payment of the transportation charges on the shipments it handled. On the assumption that the government was not reimbursed, the firm argued that FMS customers received the benefit from the reduced rates and concluded that the government was not entitled to the lower rates. GAO held that its decision recognized the separate legal identities of the FMS contracts and the GBL contracts. The decision concerned the question of whether the FMS customers reimbursed the government. The decision resolved that question in favor of the government. In the absence of any new relevant factual evidence on that question, the decision was affirmed.