Overview
This section prescribes the requirements for Federal contractors to conduct market research before awarding subcontracts to identify the availability of commercial products, commercial services, or nondevelopmental items.
Key Rules
- Threshold for Application: Market research is required for subcontracts that exceed the simplified acquisition threshold (SAT) and are for other than commercial acquisitions.
- Mandatory Definitions: The terms "commercial product," "commercial service," and "nondevelopmental item" are defined by the standards set in FAR 2.101.
- Research Objectives: Contractors must determine if existing commercial or nondevelopmental solutions can meet agency requirements as-is, through minor modification, or if requirements can be reasonably adjusted to fit available products.
- Component Integration: The rule requires contractors to investigate whether commercial items can be incorporated at the component level, even if the end item itself is not a commercial product.
Practical Implications
- Flow-down Responsibility: Prime contractors are legally required to mirror the government's preference for commercial items by performing due diligence on their own supply chain and subcontracting opportunities.
- Documentation and Compliance: Contractors must maintain evidence of market research efforts to demonstrate they are actively seeking to reduce the government's reliance on custom-built or government-unique specifications.