12.101
Policy
Agencies and contractors must prioritize commercial and nondevelopmental solutions through market research and acquisition practices to meet government needs efficiently.
Overview
FAR 12.101 establishes the policy that agencies must prioritize the use of commercial products, commercial services, or nondevelopmental items to satisfy their requirements. The regulation mandates that agencies conduct market research to identify available commercial or nondevelopmental solutions, acquire such items when they meet agency needs, and require contractors and subcontractors to use commercial or nondevelopmental components whenever practicable. This approach is intended to streamline procurement, leverage existing market solutions, and reduce the need for costly and time-consuming custom development.
Key Rules
- Market Research Requirement
- Agencies must conduct market research to determine if commercial products, services, or nondevelopmental items can meet their needs.
- Preference for Commercial Solutions
- Agencies are required to acquire commercial or nondevelopmental items when available and suitable for their requirements.
- Flow-Down to Contractors
- Prime contractors and all subcontractors must, to the maximum extent practicable, use commercial or nondevelopmental components in the items they supply to the government.
Responsibilities
- Contracting Officers: Ensure market research is performed, document findings, and prioritize commercial solutions in acquisition planning.
- Contractors: Incorporate commercial or nondevelopmental items as components in deliverables whenever feasible.
- Agencies: Oversee compliance with market research and commercial acquisition policies, and enforce flow-down requirements to contractors and subcontractors.
Practical Implications
- This policy exists to promote efficiency, cost savings, and innovation by leveraging commercial market solutions.
- It impacts daily contracting by requiring thorough market research and justifications for non-commercial acquisitions.
- Common pitfalls include inadequate market research, failure to document decisions, and not ensuring flow-down requirements to subcontractors.