(e) EXAMINATION
AND REVALIDATION
OF QUALIFICATION REQUIRE-
MENT.—Within 7 years after the establishment of a qualification require-
ment, the need for the requirement shall be examined and the standards of 
the requirement revalidated in accordance with the requirements of sub-
section (b). This subsection does not apply in the case of a qualification re-
quirement for which a waiver is in effect under subsection (c)(2). 
(f) WHEN ENFORCEMENT OF QUALIFICATION REQUIREMENT NOT AL-
LOWED.—Except in an emergency as determined by the head of the agency, 
after the head of the agency determines not to enforce a qualification re-
quirement for a solicitation, the agency may not enforce the requirement un-
less the agency complies with the requirements of subsection (b). 
CHAPTER 35—TRUTHFUL COST AND PRICING DATA 
Sec. 
3501.
Definitions. 
3502.
Required cost or pricing data and certification. 
3503.
Exceptions. 
3504.
Cost or pricing data on below-threshold contracts. 
3505.
Submission of other information. 
3506.
Price reductions for defective cost or pricing data. 
3507.
Interest and penalties for certain overpayments. 
3508.
Right to examine contractor records. 
§ 3501. Definitions 
In this chapter: 
(1) COMMERCIAL
ITEM.—The term ‘‘commercial item’’ has the 
meaning provided the term by section 103 of this title. 
(2) COST
OR
PRICING
DATA.—The term ‘‘cost or pricing data’’ 
means all facts that, as of the date of agreement on the price of a con-
tract (or the price of a contract modification) or, if applicable con-
sistent with section 3506(a)(2) of this title, another date agreed upon 
between the parties, a prudent buyer or seller would reasonably expect 
to affect price negotiations significantly. The term does not include in-
formation that is judgmental, but does include factual information from 
which a judgment was derived. 
(3) SUBCONTRACT.—The term ‘‘subcontract’’ includes a transfer of 
commercial items between divisions, subsidiaries, or affiliates of a con-
tractor or a subcontractor. 
§ 3502. Required cost or pricing data and certification 
(a) WHEN REQUIRED.—The head of an executive agency shall require 
offerors, contractors, and subcontractors to make cost or pricing data avail-
able as follows: 
(1) OFFEROR FOR PRIME CONTRACT.—An offeror for a prime con-
tract under this part to be entered into using procedures other than 
sealed-bid procedures shall be required to submit cost or pricing data 
before the award of a contract if— 
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(A) in the case of a prime contract entered into after October 
13, 1994, the price of the contract to the Federal Government is 
expected to exceed $500,000; and 
(B) in the case of a prime contract entered into on or before 
October 13, 1994, the price of the contract to the Federal Govern-
ment is expected to exceed $100,000. 
(2) CONTRACTOR.—The contractor for a prime contract under this 
part shall be required to submit cost or pricing data before the pricing 
of a change or modification to the contract if— 
(A) in the case of a change or modification made to a prime 
contract referred to in paragraph (1)(A), the price adjustment is 
expected to exceed $500,000; 
(B) in the case of a change or modification made to a prime 
contract that was entered into on or before October 13, 1994, and 
that has been modified pursuant to subsection (f), the price ad-
justment is expected to exceed $500,000; and 
(C) in the case of a change or modification not covered by sub-
paragraph (A) or (B), the price adjustment is expected to exceed 
$100,000. 
(3) OFFEROR FOR SUBCONTRACT.—An offeror for a subcontract (at 
any tier) of a contract under this part shall be required to submit cost 
or pricing data before the award of the subcontract if the prime con-
tractor and each higher-tier subcontractor have been required to make 
available cost or pricing data under this chapter and— 
(A) in the case of a subcontract under a prime contract referred 
to in paragraph (1)(A), the price of the subcontract is expected 
to exceed $500,000; 
(B) in the case of a subcontract entered into under a prime con-
tract that was entered into on or before October 13, 1994, and 
that has been modified pursuant to subsection (f), the price of the 
subcontract is expected to exceed $500,000; and 
(C) in the case of a subcontract not covered by subparagraph 
(A) or (B), the price of the subcontract is expected to exceed 
$100,000. 
(4) SUBCONTRACTOR.—The subcontractor for a subcontract covered 
by paragraph (3) shall be required to submit cost or pricing data before 
the pricing of a change or modification to the subcontract if— 
(A) in the case of a change or modification to a subcontract re-
ferred to in paragraph (3)(A) or (B), the price adjustment is ex-
pected to exceed $500,000; and 
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(B) in the case of a change or modification to a subcontract re-
ferred to in paragraph (3)(C), the price adjustment is expected to 
exceed $100,000. 
(b) CERTIFICATION.—A person required, as an offeror, contractor, or 
subcontractor, to submit cost or pricing data under subsection (a) (or re-
quired by the head of the procuring activity concerned to submit the data 
under section 3504 of this title) shall be required to certify that, to the best 
of the person’s knowledge and belief, the cost or pricing data submitted are 
accurate, complete, and current. 
(c) TO WHOM SUBMITTED.—Cost or pricing data required to be sub-
mitted under subsection (a) (or under section 3504 of this title), and a cer-
tification required to be submitted under subsection (b), shall be sub-
mitted— 
(1) in the case of a submission by a prime contractor (or an offeror 
for a prime contract), to the contracting officer for the contract (or a 
designated representative of the contracting officer); or 
(2) in the case of a submission by a subcontractor (or an offeror for 
a subcontract), to the prime contractor. 
(d) APPLICATION OF CHAPTER.—Except as provided under section 3503 
of this title, this chapter applies to contracts entered into by the head of 
an executive agency on behalf of a foreign government. 
(e) SUBCONTRACTS NOT AFFECTED BY WAIVER.—A waiver of require-
ments for submission of certified cost or pricing data that is granted under 
section 3503(a)(3) of this title in the case of a contract or subcontract does 
not waive the requirement under subsection (a)(3) of this section for sub-
mission of cost or pricing data in the case of subcontracts under that con-
tract or subcontract unless the head of the procuring activity granting the 
waiver determines that the requirement under subsection (a)(3) of this sec-
tion should be waived in the case of those subcontracts and justifies in writ-
ing the reason for the determination. 
(f) MODIFICATIONS TO PRIOR CONTRACTS.—On the request of a con-
tractor that was required to submit cost or pricing data under subsection 
(a) in connection with a prime contract entered into on or before October 
13, 1994, the head of the executive agency that entered into the contract 
shall modify the contract to reflect paragraphs (2)(B) and (3)(B) of sub-
section (a). All those modifications shall be made without requiring consid-
eration. 
(g) ADJUSTMENT OF AMOUNTS.—Effective on October 1 of each year 
that is divisible by 5, each amount set forth in subsection (a) shall be ad-
justed to the amount that is equal to the fiscal year 1994 constant dollar 
value of the amount set forth. Any amount, as so adjusted, that is not even-
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ly divisible by $50,000 shall be rounded to the nearest multiple of $50,000. 
In the case of an amount that is evenly divisible by $25,000 but not evenly 
divisible by $50,000, the amount shall be rounded to the next higher mul-
tiple of $50,000. 
§ 3503. Exceptions 
(a) IN GENERAL.—Submission of certified cost or pricing data shall not 
be required under section 3502 of this title in the case of a contract, a sub-
contract, or a modification of a contract or subcontract— 
(1) for which the price agreed on is based on— 
(A) adequate price competition; or 
(B) prices set by law or regulation; 
(2) for the acquisition of a commercial item; or 
(3) in an exceptional case when the head of the procuring activity, 
without delegation, determines that the requirements of this chapter 
may be waived and justifies in writing the reasons for the determina-
tion. 
(b) MODIFICATIONS OF CONTRACTS AND SUBCONTRACTS FOR COMMER-
CIAL ITEMS.—In the case of a modification of a contract or subcontract for 
a commercial item that is not covered by the exception to the submission 
of certified cost or pricing data in paragraph (1) or (2) of subsection (a), 
submission of certified cost or pricing data shall not be required under sec-
tion 3502 of this title if— 
(1) the contract or subcontract being modified is a contract or sub-
contract for which submission of certified cost or pricing data may not 
be required by reason of paragraph (1) or (2) of subsection (a); and 
(2) the modification would not change the contract or subcontract 
from a contract or subcontract for the acquisition of a commercial item 
to a contract or subcontract for the acquisition of an item other than 
a commercial item. 
§ 3504. Cost or pricing data on below-threshold contracts 
(a) AUTHORITY TO REQUIRE SUBMISSION.—Subject to subsection (b), 
when certified cost or pricing data are not required to be submitted by sec-
tion 3502 of this title for a contract, subcontract, or modification of a con-
tract or subcontract, the data may nevertheless be required to be submitted 
by the head of the procuring activity, but only if the head of the procuring 
activity determines that the data are necessary for the evaluation by the 
agency of the reasonableness of the price of the contract, subcontract, or 
modification of a contract or subcontract. In any case in which the head 
of the procuring activity requires the data to be submitted under this sec-
tion, the head of the procuring activity shall justify in writing the reason 
for the requirement. 
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(b) EXCEPTION.—The head of the procuring activity may not require cer-
tified cost or pricing data to be submitted under this section for any con-
tract or subcontract, or modification of a contract or subcontract, covered 
by the exceptions in section 3503(a)(1) or (2) of this title. 
(c) DELEGATION OF AUTHORITY PROHIBITED.—The head of a procuring 
activity may not delegate the functions under this section. 
§ 3505. Submission of other information 
(a) AUTHORITY TO REQUIRE SUBMISSION.—When certified cost or pric-
ing data are not required to be submitted under this chapter for a contract, 
subcontract, or modification of a contract or subcontract, the contracting of-
ficer shall require submission of data other than certified cost or pricing 
data to the extent necessary to determine the reasonableness of the price 
of the contract, subcontract, or modification of the contract or subcontract. 
Except in the case of a contract or subcontract covered by the exceptions 
in section 3503(a)(1) of this title, the contracting officer shall require that 
the data submitted include, at a minimum, appropriate information on the 
prices at which the same item or similar items have previously been sold 
that is adequate for evaluating the reasonableness of the price for the pro-
curement. 
(b) LIMITATIONS ON AUTHORITY.—The Federal Acquisition Regulation 
shall include the following provisions regarding the types of information that 
contracting officers may require under subsection (a): 
(1) REASONABLE LIMITATIONS.—Reasonable limitations on requests 
for sales data relating to commercial items. 
(2) LIMITATION ON SCOPE OF REQUEST.—A requirement that a con-
tracting officer limit, to the maximum extent practicable, the scope of 
any request for information relating to commercial items from an offer-
or to only that information that is in the form regularly maintained 
by the offeror in commercial operations. 
(3) INFORMATION NOT TO BE DISCLOSED.—A statement that any in-
formation received relating to commercial items that is exempt from 
disclosure under section 552(b) of title 5 shall not be disclosed by the 
Federal Government. 
§ 3506. Price reductions for defective cost or pricing data 
(a) PROVISION REQUIRING ADJUSTMENT.— 
(1) IN GENERAL.—A prime contract (or change or modification to 
a prime contract) under which a certificate under section 3502(b) of 
this title is required shall contain a provision that the price of the con-
tract to the Federal Government, including profit or fee, shall be ad-
justed to exclude any significant amount by which it may be deter-
mined by the head of the executive agency that the price was increased 
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because the contractor (or any subcontractor required to make the cer-
tificate available) submitted defective cost or pricing data. 
(2) WHAT CONSTITUTES DEFECTIVE COST OR PRICING DATA.—For 
the purposes of this chapter, defective cost or pricing data are cost or 
pricing data that, as of the date of agreement on the price of the con-
tract (or another date agreed on between the parties), were inaccurate, 
incomplete, or noncurrent. If for purposes of the preceding sentence the 
parties agree on a date other than the date of agreement on the price 
of the contract, the date agreed on by the parties shall be as close to 
the date of agreement on the price of the contract as is practicable. 
(b) VALID DEFENSE.—In determining for purposes of a contract price 
adjustment under a contract provision required by subsection (a) whether, 
and to what extent, a contract price was increased because the contractor 
(or a subcontractor) submitted defective cost or pricing data, it is a defense 
that the Federal Government did not rely on the defective data submitted 
by the contractor or subcontractor. 
(c) INVALID DEFENSES.—It is not a defense to an adjustment of the 
price of a contract under a contract provision required by subsection (a) 
that— 
(1) the price of the contract would not have been modified even if 
accurate, complete, and current cost or pricing data had been sub-
mitted by the contractor or subcontractor because the contractor or 
subcontractor— 
(A) was the sole source of the property or services procured; or 
(B) otherwise was in a superior bargaining position with respect 
to the property or services procured; 
(2) the contracting officer should have known that the cost or pricing 
data in issue were defective even though the contractor or subcon-
tractor took no affirmative action to bring the character of the data 
to the attention of the contracting officer; 
(3) the contract was based on an agreement between the contractor 
and the Federal Government about the total cost of the contract and 
there was no agreement about the cost of each item procured under 
the contract; or 
(4) the prime contractor or subcontractor did not submit a certifi-
cation of cost or pricing data relating to the contract as required by 
section 3502(b) of this title. 
(d) OFFSETS.— 
(1) WHEN ALLOWED.—A contractor shall be allowed to offset an 
amount against the amount of a contract price adjustment under a 
contract provision required by subsection (a) if— 
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(A) the contractor certifies to the contracting officer (or to a 
designated representative of the contracting officer) that, to the 
best of the contractor’s knowledge and belief, the contractor is en-
titled to the offset; and 
(B) the contractor proves that the cost or pricing data were 
available before the date of agreement on the price of the contract 
(or price of the modification), or, if applicable, consistent with 
subsection (a)(2), another date agreed on by the parties, and that 
the data were not submitted as specified in section 3502(c) of this 
title before that date. 
(2) WHEN NOT ALLOWED.—A contractor shall not be allowed to off-
set an amount otherwise authorized to be offset under paragraph (1) 
if— 
(A) the certification under section 3502(b) of this title with re-
spect to the cost or pricing data involved was known to be false 
when signed; or 
(B) the Federal Government proves that, had the cost or pricing 
data referred to in paragraph (1)(B) been submitted to the Fed-
eral Government before date of agreement on the price of the con-
tract (or price of the modification), or, if applicable, under sub-
section (a)(2), another date agreed on by the parties, the submis-
sion of the cost or pricing data would not have resulted in an in-
crease in that price in the amount to be offset. 
§ 3507. Interest and penalties for certain overpayments 
(a) IN GENERAL.—If the Federal Government makes an overpayment to 
a contractor under a contract with an executive agency subject to this chap-
ter and the overpayment was due to the submission by the contractor of 
defective cost or pricing data, the contractor shall be liable to the Federal 
Government— 
(1) for interest on the amount of the overpayment, to be computed— 
(A) for the period beginning on the date the overpayment was 
made to the contractor and ending on the date the contractor re-
pays the amount of the overpayment to the Federal Government; 
and 
(B) at the current rate prescribed by the Secretary of the 
Treasury under section 6621 of the Internal Revenue Code of 
1986 (26 U.S.C. 6621); and 
(2) if the submission of the defective data was a knowing submission, 
for an additional amount equal to the amount of the overpayment. 
(b) LIABILITY NOT AFFECTED
BY REFUSAL TO SUBMIT CERTIFI-
CATION.—Any liability under this section of a contractor that submits cost 
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100 
or pricing data but refuses to submit the certification required by section 
3502(b) of this title with respect to the cost or pricing data is not affected 
by the refusal to submit the certification. 
§ 3508. Right to examine contractor records 
For the purpose of evaluating the accuracy, completeness, and currency 
of cost or pricing data required to be submitted by this chapter, an execu-
tive agency shall have the authority provided by section 4706(b)(2) of this 
title. 
CHAPTER 37—AWARDING OF CONTRACTS 
Sec. 
3701.
Basis of award and rejection. 
3702.
Sealed bids. 
3703.
Competitive proposals. 
3704.
Post-award debriefings. 
3705.
Pre-award debriefings. 
3706.
Encouragement of alternative dispute resolution. 
3707.
Antitrust violations. 
3708.
Protests. 
§ 3701. Basis of award and rejection 
(a) AWARD.—An executive agency shall evaluate sealed bids and competi-
tive proposals, and award a contract, based solely on the factors specified 
in the solicitation. 
(b) REJECTION.—All sealed bids or competitive proposals received in re-
sponse to a solicitation may be rejected if the agency head determines that 
rejection is in the public interest. 
§ 3702. Sealed bids 
(a) OPENING OF BIDS.—Sealed bids shall be opened publicly at the time 
and place stated in the solicitation. 
(b) CRITERIA FOR AWARDING CONTRACT.—The executive agency shall 
evaluate the bids in accordance with section 3701(a) of this title without 
discussions with the bidders and, except as provided in section 3701(b) of 
this title, shall award a contract with reasonable promptness to the respon-
sible source whose bid conforms to the solicitation and is most advantageous 
to the Federal Government, considering only price and the other price-re-
lated factors included in the solicitation. 
(c) NOTICE OF AWARD.—The award of a contract shall be made by trans-
mitting, in writing or by electronic means, notice of the award to the suc-
cessful bidder. Within 3 days after the date of contract award, the executive 
agency shall notify, in writing or by electronic means, each bidder not 
awarded the contract that the contract has been awarded. 
§ 3703. Competitive proposals 
(a) EVALUATION AND AWARD.—An executive agency shall evaluate com-
petitive proposals in accordance with section 3701(a) of this title and may 
award a contract— 
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101 
(1) after discussions with the offerors, provided that written or oral 
discussions have been conducted with all responsible offerors who sub-
mit proposals within the competitive range; or 
(2) based on the proposals received and without discussions with the 
offerors (other than discussions conducted for the purpose of minor 
clarification), if, as required by section 3305(b)(2)(B)(i) of this title, 
the solicitation included a statement that proposals are intended to be 
evaluated, and award made, without discussions unless discussions are 
determined to be necessary. 
(b) LIMIT ON NUMBER OF PROPOSALS.—If the contracting officer deter-
mines that the number of offerors that would otherwise be included in the 
competitive range under subsection (a)(1) exceeds the number at which an 
efficient competition can be conducted, the contracting officer may limit the 
number of proposals in the competitive range, in accordance with the cri-
teria specified in the solicitation, to the greatest number that will permit 
an efficient competition among the offerors rated most highly in accordance 
with those criteria. 
(c) CRITERIA FOR AWARDING CONTRACT.—Except as otherwise provided 
in section 3701(b) of this title, the executive agency shall award a contract 
with reasonable promptness to the responsible source whose proposal is most 
advantageous to the Federal Government, considering only cost or price and 
the other factors included in the solicitation. 
(d) NOTICE OF AWARD.—The executive agency shall award the contract 
by transmitting, in writing or by electronic means, notice of the award to 
that source and, within 3 days after the date of contract award, shall notify, 
in writing or by electronic means, all other offerors of the rejection of their 
proposals. 
§ 3704. Post-award debriefings 
(a) REQUEST FOR DEBRIEFING.—When a contract is awarded by the 
head of an executive agency on the basis of competitive proposals, an unsuc-
cessful offeror, on written request received by the agency within 3 days after 
the date on which the unsuccessful offeror receives the notification of the 
contract award, shall be debriefed and furnished the basis for the selection 
decision and contract award. 
(b) WHEN DEBRIEFING TO BE CONDUCTED.—The executive agency shall 
debrief the offeror within, to the maximum extent practicable, 5 days after 
receipt of the request by the executive agency. 
(c) INFORMATION TO BE PROVIDED.—The debriefing shall include, at a 
minimum— 
(1) the executive agency’s evaluation of the significant weak or defi-
cient factors in the offeror’s offer; 
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