data gathering, environmental cleanup and restoration, pollution reduction in manufacturing, environmental conservation, and environmentally safe management of facilities.

(h) MAJOR CONTRACTORS.-A contractor shall be considered to be a major contractor for the purposes of subsection (c) for any fiscal year if for the preceding fiscal year the contractor's covered segments allocated to Department of Defense contracts a total of more than $10,000,000 in independent research and development and bid and proposal costs.

(i) DEFINITIONS.-In this section:

(1) COVERED CONTRACT.-The term "covered contract" has the meaning given that term in section 2324(m)5 of this title. (2) COVERED SEGMENT.-The term "covered segment", with respect to a contractor, means a product division of the contractor that allocated more than $1,000,000 in independent research and development and bid and proposal costs to Department of Defense contracts during the preceding fiscal year. In the case of a contractor that has no product divisions, such term means the contractor as a whole.

(Added P.L. 101-510, § 824(a), Nov. 5, 1990, 104 Stat. 1603, and amended P.L. 102-25, §701(c), April 6, 1991, 105 Stat. 113; P.L. 102-190, §802(a)(1), Dec. 5, 1991, 105 Stat. 1412; P.L. 102484, § 1052(27), Oct. 23, 1992, 106 Stat. 2500; P.L. 103–35, §201(c)(5), May 31, 1993, 107 Stat. 98.)

§ 2373. Procurement for experimental purposes

(a) AUTHORITY.-The Secretary of Defense and the Secretaries of the military departments may each buy ordnance, signal, chemical activity, and aeronautical supplies, including parts and accessories, and designs thereof, that the Secretary of Defense or the Secretary concerned considers necessary for experimental or test purposes in the development of the best supplies that are needed for the national defense.

(b) PROCEDURES.-Purchases under this section may be made. inside or outside the United States and by contract or otherwise. Chapter 137 of this title applies when such purchases are made in quantity.

(Added P.L. 103-160, § 822(c)(1), Nov. 30, 1993, 107 Stat. 1706, and amended P.L. 103-337, 1070(g), Oct. 5, 1994, 108 Stat. 2859.)

§ 2374. Merit-based award of grants for research and development

(a) It is the policy of Congress that an agency named in section 2303(a) of this title should not be required by legislation to award a new grant for research, development, test, or evaluation to a nonFederal Government entity. It is further the policy of Congress that any program, project, or technology identified in legislation be awarded through merit-based selection procedures.

(b) A provision of law may not be construed as requiring a new grant to be awarded to a specified non-Federal Government entity unless that provision of law

(1) specifically refers to this subsection;

Section 2324(m) of this title, referred to in subsection (i)(1), was repealed by section 2101(d) of P.L. 103-355 (108 Stat. 3308). The term "covered contract" is now defined in section 2324(1)(1).

89-263 95-7

(2) specifically identifies the particular non-Federal Government entity involved; and

(3) specifically states that the award to that entity is required by such provision of law in contravention of the policy set forth in subsection (a).

(c) For purposes of this section, a grant is a new grant unless the work provided for in the grant is a continuation of the work performed by the specified entity under a preceding grant.

(d) This section shall not apply with respect to any grant that calls upon the National Academy of Sciences to investigate, examine, or experiment upon any subject of science or art of significance to an agency named in section 2303(a) of this title and to report on such matters to the Congress or any agency of the Federal Gov

ernment.

(Added P.L. 103–355, § 7203(a)(2), Oct. 13, 1994, 108 Stat. 3380.)

Sec.

2375.

2376.

2377.

CHAPTER 140-PROCUREMENT OF COMMERCIAL

ITEMS 1

Relationship of commercial item provisions to other provisions of law.
Definitions.

Preference for acquisition of commercial items.

§ 2375. Relationship of commercial item provisions to other provisions of law

(a) APPLICABILITY OF TITLE.-Unless otherwise specifically provided, nothing in this chapter shall be construed as providing that any other provision of this title relating to procurement is inapplicable to the procurement of commercial items.

(b) LIST OF LAWS INAPPLICABLE TO CONTRACTS FOR THE ACQUISITION OF COMMERCIAL ITEMS.-No contract for the procurement of a commercial item entered into by the head of an agency shall be subject to any law properly listed in the Federal Acquisition Regulation (pursuant to section 34 of the Office of Federal Procurement Policy Act).

(c) CROSS REFERENCE TO EXCEPTION TO COST OR PRICING Data REQUIREMENTS FOR COMMERCIAL ITEMS.-For provisions relating to exceptions for requirements for cost or pricing data for contracts for the procurement of commercial items, see section 2306a(d) of this title.

(Added P.L. 103-355, § 8102, Oct. 13, 1994, 108 Stat. 3390.)

§ 2376. Definitions

In this chapter:

(1) The terms "commercial item", "nondevelopmental item", "component", and "commercial component" have the meanings provided in section 4 of the Office of Federal Procurement Policy Act. 2

(2) The term "head of an agency" means the Secretary of Defense, the Secretary of Transportation, and the Administrator of the National Aeronautics and Space Administration.

(3) The term "agency" means the Department of Defense, the Coast Guard, and the National Aeronautics and Space Administration.

(Added P.L. 103-355, §8103, Oct. 13, 1994, 108 Stat. 3390.)

§ 2377. Preference for acquisition of commercial items

(a) PREFERENCE.-The head of an agency shall ensure that, to the maximum extent practicable

1 For a provision on regulations implementing chapter 140, see section 8002 of the Federal Acquisition Streamlining Act of 1994 (P.L. 103–355; 41 U.S.C. 264 note), set forth beginning on page 466. Section 4 of the Office of Federal Procurement Policy Act, referred to in section 2376(1), is set forth beginning on page 542.

(1) requirements of the agency with respect to a procurement of supplies or services are stated in terms of

(A) functions to be performed;

(B) performance required; or

(C) essential physical characteristics;

(2) such requirements are defined so that commercial items or, to the extent that commercial items suitable to meet the agency's needs are not available, nondevelopmental items other than commercial items, may be procured to fulfill such requirements; and

(3) offerors of commercial items and nondevelopmental items other than commercial items are provided an opportunity to compete in any procurement to fill such requirements.

(b) IMPLEMENTATION.-The head of an agency shall ensure that procurement officials in that agency, to the maximum extent practicable

(1) acquire commercial items or nondevelopmental items other than commercial items to meet the needs of the agency;

(2) require prime contractors and subcontractors at all levels under the agency contracts to incorporate commercial items or nondevelopmental items other than commercial items as components of items supplied to the agency;

(3) modify requirements in appropriate cases to ensure that the requirements can be met by commercial items or, to the extent that commercial items suitable to meet the agency's needs are not available, nondevelopmental items other than commercial items;

(4) state specifications in terms that enable and encourage bidders and offerors to supply commercial items or, to the extent that commercial items suitable to meet the agency's needs are not available, nondevelopmental items other than commercial items in response to the agency solicitations;

(5) revise the agency's procurement policies, practices, and procedures not required by law to reduce any impediments in those policies, practices, and procedures to the acquisition of commercial items; and

(6) require training of appropriate personnel in the acquisition of commercial items.

(c) PRELIMINARY MARKET RESEARCH.-(1) The head of an agency shall conduct market research appropriate to the circumstances

(A) before developing new specifications for a procurement by that agency; and

(B) before soliciting bids or proposals for a contract in excess of the simplified acquisition threshold.

(2) The head of an agency shall use the results of market research to determine whether there are commercial items or, to the extent that commercial items suitable to meet the agency's needs are not available, nondevelopmental items other than commercial items available that

or

(A) meet the agency's requirements;

(B) could be modified to meet the agency's requirements;

(C) could meet the agency's requirements if those requirements were modified to a reasonable extent.

(3) In conducting market research, the head of an agency should not require potential sources to submit more than the minimum information that is necessary to make the determinations required in paragraph (2).

(Added P.L. 103–355, § 8104(a), Oct. 13, 1994, 108 Stat. 3390.)