CLARIFICATION OF RULES REGARDING THE PROCUREMENT OF COMMERCIAL ITEMS.

SEC. 815. CLARIFICATION OF RULES REGARDING THE PROCUREMENT OF COMMERCIAL ITEMS.(a) Treatment of Subsystems, Components, and Spare Parts as Commercial Items.—(1) In general.—Section 2379 of title 10, United States Code, is amended—(A) in subsection (a)—(i) by redesignating paragraph (2) as paragraph (3);(ii) in paragraph (1)(B), by striking “and” at the end; and(iii) by inserting after paragraph (1), the following:“(2) the offeror has submitted sufficient information to evaluate, through price analysis, the reasonableness of the price for such system; and”;(B) by striking subsection (b) and inserting the following new subsection (b):“(b) Treatment of Subsystems as Commercial Items.—A subsystem of a major weapon system (other than a commercially available off-the-shelf item as defined in section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 431(c))) shall be treated as a commercial item and purchased under procedures established for the procurement of commercial items only if—“(1) 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 items in accordance with the requirements of subsection (a); or“(2) the contracting officer determines in writing that—“(A) the subsystem is a commercial item, as defined in section 4(12) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(12)); and“(B) the offeror has submitted sufficient information to evaluate, through price analysis, the reasonableness of the price for such subsystem.”;(C) by redesignating subsections (c) and (d) as subsections (e) and (f), respectively; and(D) by inserting after subsection (b) the following new subsections (c) and (d):“(c) Treatment of Components and Spare Parts as Commercial Items.—(1) A component or spare part for a major weapon system (other than a commercially available off-the-shelf item as defined in section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 431(c))) may be treated as a commercial item for the purposes of section 2306a of this title only if—122 STAT. 223“(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 items 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 items in accordance with the requirements of subsection (b); or“(B) the contracting officer determines in writing that—“(i) the component or spare part is a commercial item, as defined in section 4(12) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(12)); and“(ii) the offeror has submitted sufficient information to evaluate, through price analysis, the reasonableness of the price for such component or spare part.“(2) This subsection shall apply only to components and spare parts that are acquired by the Department of Defense through a prime contract or a modification to a prime contract (or through a subcontract under a prime contract or modification to a prime contract on which the prime contractor adds no, or negligible, value).“(d) Information Submitted.—To the extent necessary to make a determination under subsection (a)(2), (b)(2), or (c)(1)(B), the contracting officer may request the offeror to submit—“(1) prices paid for the same or similar commercial items under comparable terms and conditions by both government and commercial customers; and“(2) if the contracting officer determines that the information described in paragraph (1) is not sufficient to determine the reasonableness of price, other relevant information regarding the basis for price or cost, including information on labor costs, material costs, and overhead rates.”.(2) Conforming amendment to technical data provision.—Section 2321(f)(2) of such title is amended by striking “(whether or not under a contract for commercial items)” and inserting “(other than technical data for a commercially available off-the-shelf item as defined in section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 431(c)))”.(b) Sales of Commercial Items to Nongovernmental Entities.—Not later than 180 days after the date of the enactment of this Act, the Secretary of Defense shall modify the regulations of the Department of Defense on the procurement of commercial items in order to clarify that the terms “general public” and “nongovernmental entities” in such regulations do not include the Federal Government or a State, local, or foreign government.