§264. Relationship of commercial item provisions to other provisions of law

(a) Applicability of subchapter

Unless otherwise specifically provided, nothing in this section, section 264a of this title, or section 264b of this title shall be construed as providing that any other provision of this subchapter relating to procurement is inapplicable to the procurement of commercial items.

(b) List of laws inapplicable to contracts for acquisition of commercial items

No contract for the procurement of a commercial item entered into by the head of an executive agency shall be subject to any law properly listed in the Federal Acquisition Regulation (pursuant to section 430 of this title).

(June 30, 1949, ch. 288, title III, §314, as added Pub. L. 103–355, title VIII, §8201, Oct. 13, 1994, 108 Stat. 3394 .)

Effective Date

For effective date and applicability of section, see section 10001 of Pub. L. 103–355, set out as an Effective Date of 1994 Amendment note under section 251 of this title.

Regulations

Section 8002 of Pub. L. 103–355 provided that:

"(a) In General.-The Federal Acquisition Regulation shall provide regulations to implement paragraphs (12) through (15) of section 4 of the Office of Federal Procurement Policy Act [41 U.S.C. 403(12)–(15)], chapter 140 of title 10, United States Code, and sections 314 through 314B of the Federal Property and Administrative Services Act of 1949 [41 U.S.C. 264–264b].

"(b) Contract Clauses.-(1) The regulations prescribed under subsection (a) shall contain a list of contract clauses to be included in contracts for the acquisition of commercial end items. Such list shall, to the maximum extent practicable, include only those contract clauses-

"(A) that are required to implement provisions of law or executive orders applicable to acquisitions of commercial items or commercial components, as the case may be; or

"(B) that are determined to be consistent with standard commercial practice.

"(2) Such regulations shall provide that a prime contractor shall not be required by the Federal Government to apply to any of its divisions, subsidiaries, affiliates, subcontractors, or suppliers that are furnishing commercial items any contract clause except those-

"(A) that are required to implement provisions of law or executive orders applicable to subcontractors furnishing commercial items or commercial components, as the case may be; or

"(B) that are determined to be consistent with standard commercial practice.

"(3) To the maximum extent practicable, only the contract clauses listed pursuant to paragraph (1) may be used in a contract, and only the contract clauses referred to in paragraph (2) may be required to be used in a subcontract, for the acquisition of commercial items or commercial components by or for an executive agency.

"(4) The Federal Acquisition Regulation shall provide standards and procedures for waiving the use of contract clauses required pursuant to paragraph (1), other than those required by law, including standards for determining the cases in which a waiver is appropriate.

"(5) For purposes of this subsection, the term 'subcontract' includes a transfer of commercial items between divisions, subsidiaries, or affiliates of a contractor or subcontractor.

"(c) Market Acceptance.-(1) The Federal Acquisition Regulation shall provide that under appropriate conditions the head of an executive agency may require offerors to demonstrate that the items offered-

"(A) have either-

"(i) achieved commercial market acceptance; or

"(ii) been satisfactorily supplied to an executive agency under current or recent contracts for the same or similar requirements; and

"(B) otherwise meet the item description, specifications, or other criteria prescribed in the public notice and solicitation relating to the contract.

"(2) The Federal Acquisition Regulation shall provide guidance to ensure that the criteria for determining commercial market acceptance include the consideration of-

"(A) the minimum needs of the executive agency concerned; and

"(B) the entire relevant commercial market, including small businesses.

"(d) Use of Firm, Fixed Price Contracts.-The Federal Acquisition Regulation shall include, for acquisitions of commercial items-

"(1) a requirement that firm, fixed price contracts or fixed price with economic price adjustment contracts be used to the maximum extent practicable; and

"(2) a prohibition on use of cost type contracts.

"(e) Contract Quality Requirements.-The regulations prescribed under subsection (a) shall include provisions that-

"(1) permit, to the maximum extent practicable, a contractor under a commercial items acquisition to use the existing quality assurance system of the contractor as a substitute for compliance with an otherwise applicable requirement for the Government to inspect or test the commercial items before the contractor's tender of those items for acceptance by the Government;

"(2) require that, to the maximum extent practicable, the executive agency take advantage of warranties (including extended warranties) offered by offerors of commercial items and use such warranties for the repair and replacement of commercial items; and

"(3) set forth guidance regarding the use of past performance of commercial items and sources as a factor in contract award decisions.

"(f) Defense Contract Clauses.-(1) Section 824(b) of the National Defense Authorization Act for Fiscal Years 1990 and 1991 (Public Law 101–189; [former] 10 U.S.C. 2325 note) shall cease to be effective on the date on which the regulations implementing this section become effective [Oct. 1, 1995, see 60 F.R. 48231, Sept. 18, 1995].

"(2) Notwithstanding subsection (b), a contract of the Department of Defense entered into before the date on which section 824(b) ceases to be effective under paragraph (1), and a subcontract entered into before such date under such a contract, may include clauses developed pursuant to paragraphs (2) and (3) of section 824(b) of the National Defense Authorization Act for Fiscal Years 1990 and 1991 (Public Law 101–189; [former] 10 U.S.C. 2325 note)."

Provisions Not Affected by Title VIII of Pub. L. 103–355

Section 8304 of title VIII of Pub. L. 103–355 provided that: "Nothing in this title [enacting this section, sections 264a, 264b, and 430 of this title, sections 2375 to 2377 of Title 10, Armed Forces, and section 334 of Title 40, Public Buildings, Property, and Works, amending sections 57, 58, 253g, 254, 403, 416, 418, 422, 423, and 701 of this title, sections 2306, 2320, 2321, 2384, 2393, 2397, 2397b, 2397c, 2402, 2408, and 2410b of Title 10, section 1368 of Title 33, Navigation and Navigable Waters, and section 40118 of Title 49, Transportation, repealing section 424 of this title and section 2325 of Title 10, enacting provisions set out as notes under this section, sections 264b and 430 of this title, and section 7606 of Title 42, The Public Health and Welfare, and amending provisions set out as notes under sections 2301 and 2327 of Title 10] shall be construed as modifying or superseding, or as intended to impair or restrict, authorities or responsibilities under-

"(1) section 2323 of title 10, United States Code, or section 7102 of the Federal Acquisition Streamlining Act of 1994 [Pub. L. 103–355, 15 U.S.C. 644 note];

"(2) the Brooks Automatic Data Processing Act (section 111 of the Federal Property and Administrative Services Act of 1949 ([former] 40 U.S.C. 759));

"(3) Brooks Architect-Engineers Act (title IX of the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 541 et seq.));

"(4) subsections (a) and (d) of section 8 of the Small Business Act (15 U.S.C. 637(a) and (d)); or

"(5) the Javits-Wagner-O'Day Act (41 U.S.C. 46–48c)."