10 USC 3455 - Procurement of a major weapon system as a commercial product: requirement for prior determination by Secretary of Defense and notification to Congress

U.S Code last checked for updates: Nov 22, 2024

§ 3455.

Procurement of a major weapon system as a commercial product: requirement for prior determination by Secretary of Defense and notification to Congress

(a)

Requirement for Determination and Notification.—

A major weapon system of the Department of Defense may be treated as a commercial product, or purchased under procedures established for the procurement of commercial products, only if—

(1)

the Secretary of Defense determines that—

(A)

the major weapon system is a commercial product; and

(B)

such treatment is necessary to meet national security objectives; and

(2)

the congressional defense committees are notified at least 30 days before such treatment or purchase occurs.

(b)

Treatment of Subsystems as Commercial Products.—

(1)

A subsystem of a major weapon system (other than a commercially available off-the-shelf item as defined in section 104 of title 41) shall be treated as a commercial product and purchased under procedures established for the procurement of commercial products if either—

(A)

the subsystem is intended for a major weapon system that is being purchased, or has been purchased, under procedures established for the procurement of commercial products in accordance with the requirements of subsection (a); or

(B)

the contracting officer determines in writing that the subsystem is a commercial product.

(2)

(A)

For a subsystem proposed as commercial (as defined in section 103(1) of title 41) and that has not been previously determined commercial in accordance with section 3703(d) of this title, the offeror shall—

(i)

identify the comparable commercial product the offeror sells to the general public or nongovernmental entities that serves as the basis for the “of a type” assertion;

(ii)

submit to the contracting officer a comparison necessary to serve as the basis of the “of a type” assertion of the physical characteristics and functionality between the subsystem and the comparable commercial product identified under clause (i); and

(iii)

provide to the contracting officer the National Stock Number for both the comparable commercial product identified under clause (i), if one is assigned, and the subsystem, if one is assigned.

(B)

If the offeror does not sell a comparable commercial product to the general public or nongovernmental entities for purposes other than governmental purposes that can serve as the basis for an “of a type” assertion with respect to the subsystem—

(i)

the offeror shall—

(I)

notify the contracting officer in writing that it does not so sell such a comparable commercial product; and

(II)

provide to the contracting officer a comparison necessary to serve as the basis of the “of a type” assertion of the physical characteristics and functionality between the subsystem and the most comparable commercial product in the commercial marketplace, to the extent reasonably known by the offeror; and

(ii)

subparagraph (A) shall not apply with respect to the offeror for such subsystem.

(c)

Treatment of Components and Spare Parts as Commercial Products.—

(1)

A component or spare part for a major weapon system (other than a commercially available off-the-shelf item as defined in section 104 of title 41) may be treated as a commercial product for the purposes of chapter 271 of this title if either—

(A)

the component or spare part is intended for—

(i)

a major weapon system that is being purchased, or has been purchased, under procedures established for the procurement of commercial products in accordance with the requirements of subsection (a); or

(ii)

a subsystem of a major weapon system that is being purchased, or has been purchased, under procedures established for the procurement of commercial products in accordance with the requirements of subsection (b); or

(B)

the contracting officer determines in writing that the component or spare part is a commercial product.

(2)

(A)

For a component or spare part proposed as commercial (as defined in section 103(1) of title 41) and that has not previously been determined commercial in accordance with section 3703(d) of this title, the offeror shall—

(i)

identify the comparable commercial product the offeror sells to the general public or nongovernmental entities that serves as the basis for the “of a type” assertion;

(ii)

submit to the contracting officer a comparison necessary to serve as the basis of the “of a type” assertion of the physical characteristics and functionality between the component or spare part and the comparable commercial product identified under clause (i); and

(iii)

provide to the contracting officer the National Stock Number for both the comparable commercial product identified under clause (i), if one is assigned, and the component or spare part, if one is assigned.

(B)

(i)

the offeror shall—

(I)

notify the contracting officer in writing that it does not so sell such a comparable commercial product; and

(II)

provide to the contracting officer a comparison necessary to serve as the basis of the “of a type” assertion of the physical characteristics and functionality between the component or spare part and the most comparable commercial product in the commercial marketplace, to the extent reasonably known by the offeror; and

(ii)

subparagraph (A) shall not apply with respect to the offeror for such component or spare part.

(d)

Information Submitted for Procurements That Are Not Covered by the Exceptions in Section 3703(a)(1) of This Title.—

(1)

To the extent necessary to determine the reasonableness of the price for items acquired under this section, the offeror shall, in accordance with paragraph (4), submit to the contracting officer or provide the contracting officer access to—

(A)

a representative sample, as determined by the contracting officer, of the prices paid for the same or similar commercial products under comparable terms and conditions by both Government and commercial customers, and the terms and conditions of such sales;

(B)

if the contracting officer determines that the offeror does not have access to and cannot provide sufficient information described in subparagraph (A) to determine the reasonableness of price, a representative sample, as determined by the contracting officer, of the prices paid for the same or similar commercial products sold under different terms and conditions, and the terms and conditions of such sales; and

(C)

only if the contracting officer determines that the information submitted pursuant to subparagraphs (A) and (B) is not sufficient to determine the reasonableness of price because either the comparable commercial products provided by the offeror are not a valid basis for a price analysis or the contracting officer determines the proposed price is not reasonable after evaluating sales data, and the contracting officer receives the approval described in paragraph (5), other relevant information regarding the basis for price or cost, including information on labor costs, material costs, and overhead rates.

(2)

An offeror may submit information or analysis relating to the value of a commercial product to aid in the determination of the reasonableness of the price of such item. A contracting officer may consider such information or analysis in addition to the information submitted pursuant to paragraphs (1)(A) and (1)(B).

(3)

An offeror may not be required to submit information described in paragraph (1)(C) with regard to a commercially available off-the-shelf item and may be required to submit such information with regard to any other item that was developed exclusively at private expense only after the head of the contracting activity determines in writing that the information submitted pursuant to paragraphs (1)(A) and (1)(B) is not sufficient to determine the reasonableness of price.

(4)

(A)

An offeror may redact data information submitted or made available under subparagraph (A) or (B) of paragraph (1) with respect to sales of an item acquired under this section only to the extent necessary to remove information individually identifying government customers, commercial customers purchasing such item for governmental purposes, and commercial customers purchasing such item for commercial, mixed, or unknown purposes.

(B)

Before an offeror may exercise the authority under subparagraph (A) with respect to a customer, the offeror shall certify in writing to the contracting officer whether the customer is a government customer, a commercial customer purchasing the item for governmental purpose, or a commercial customer purchasing the item for a commercial, mixed, or unknown purpose.

(5)

A contracting officer may not require an offeror to submit or make available information under paragraph (1)(C) without approval from a level above the contracting officer.

(6)

Nothing in this subsection shall relieve an offeror of other obligations under any other law or regulation to disclose and support the actual rationale of the offeror for the price proposed by the offeror to the Government for any good or service.

(e)

Delegation.—

The authority of the Secretary of Defense to make a determination under subsection (a) may be delegated only to the Deputy Secretary of Defense, without further redelegation.

(f)

Major Weapon System Defined.—

In this section, the term “major weapon system” means a weapon system acquired pursuant to a major defense acquisition program (as that term is defined in section 2430 1

 See References in Text note below.

of this title).

(g)

Applicability.—

(1)

In general.—

Subsections (b) and (c) shall apply only with respect to subsystems described in subsection (b) and components or spare parts described in subsection (c), respectively, that the Department of Defense acquires through—

(A)

a prime contract;

(B)

a modification to a prime contract; or

(C)

a subcontract described in paragraph (2).

(2)

Subcontract described.—

A subcontract described in this paragraph is a subcontract through which the Department of Defense acquires a subsystem or component or spare part proposed as commercial (as defined in section 103(1) of title 41) under this section and that has not previously been determined commercial in accordance with section 3703(d).

(Added Pub. L. 109–163, div. A, title VIII, § 803(a)(1), Jan. 6, 2006, 119 Stat. 3370, § 2379; amended Pub. L. 110–181, div. A, title VIII, § 815(a)(1), Jan. 28, 2008, 122 Stat. 222; Pub. L. 113–291, div. A, title X, § 1071(a)(7), Dec. 19, 2014, 128 Stat. 3504; Pub. L. 114–92, div. A, title VIII, § 852(a)–(d), Nov. 25, 2015, 129 Stat. 917, 918; Pub. L. 114–328, div. A, title VIII, § 872, Dec. 23, 2016, 130 Stat. 2307; Pub. L. 115–232, div. A, title VIII, § 836(d)(4), (8)(D), Aug. 13, 2018, 132 Stat. 1868, 1869; renumbered § 3455 and amended Pub. L. 116–283, div. A, title XVIII, §§ 1821(a)(2), (b)(4), 1831(j)(4), 1883(b)(2), Jan. 1, 2021, 134 Stat. 4195, 4217, 4294; Pub. L. 117–81, div. A, title XVII, § 1701(b)(10)(i)(ii), Dec. 27, 2021, 135 Stat. 2134; Pub. L. 117–263, div. A, title VIII, § 803, Dec. 23, 2022, 136 Stat. 2693.)

cite as: 10 USC 3455