10 U.S.C. § 3805: Payments for commercial…

Summary

Agency leaders may pay for commercial products and services using the same kinds of terms and practices found in the commercial marketplace, if those terms are in the government's best interest. They must get adequate security for those payments. If the security is a lien for the United States, that lien is ahead of all other liens and takes effect as soon as the first payment is made, without any filing or notice. Advance payments before work begins may not be more than 15 percent of the contract price. Other payment rules do not have to apply if the agency head finds they conflict with commercial terms. Payments for covered services bought using a commercially used commercial approach are not treated as advance payments under the other payment rule. A commercially utilized acquisition strategy means buying a service on terms like those offered to the public and delivered as a consumption-based solution or a subscription/flat-access model. A covered service means a commercial offering that combines hardware, software, equipment, labor, or services (for example, commercial satellite data) to provide a capability.

Title 10, §3805

Armed Forces, Source: USLM XML via OLRC

(a)Terms and Conditions for Payments.—

Payments under section 3801 of this title for commercial products and commercial services may be made under such terms and conditions as the head of the agency determines are appropriate or customary in the commercial marketplace and are in the best interests of the United States.

(b)Security for Payments.—

The head of the agency shall obtain adequate security for such payments. If the security is in the form of a lien in favor of the United States, such lien is paramount to all other liens and is effective immediately upon the first payment, without filing, notice, or other action by the United States.

(c)Limitation on Advance Payments.—

Advance payments made under section 3801 of this title for commercial products and commercial services may include payments, in a total amount of not more than 15 percent of the contract price, in advance of any performance of work under the contract.

(d)Nonapplication of Certain Conditions.—

(1)The conditions of section 3803 and 3804 of this title need not be applied if they would be inconsistent, as determined by the head of the agency, with commercial terms and conditions pursuant to this section.

(2)For the purposes of section 3803 of this title, a payment for covered services acquired through a commercially utilized acquisition strategy shall not be considered an advance payment made under section 3801 of this title.

(e)Definitions.—

In this section: (1)

(2)The term “covered service” means a commercial service that includes access to or use of any combination of hardware, equipment, software, labor, or services, including access to commercial satellite data and associated services, that is integrated to provide a capability.

Notes & Related Subsidiaries

Editorial Notes

Codification The text of subsec. (f) of section 2307 of this title, which was transferred to this section and amended by Pub. L. 116–283, § 1834(f), was based on Pub. L. 103–355, title II, § 2001(f), Oct. 13, 1994, 108 Stat. 3302; Pub. L. 115–232, div. A, title VIII, § 836(c)(6), Aug. 13, 2018, 132 Stat. 1866.

Amendments

2025—Subsec. (d). Pub. L. 119–60, § 1827(1), designated existing provisions as par. (1) and added par. (2). Subsec. (e). Pub. L. 119–60, § 1827(2), added subsec. (e). 2021—Pub. L. 116–283, § 1834(f)(1)(A), transferred subsec. (f) of section 2307 of this title to this section and struck out subsec. (f) designation and heading “Conditions for Payments for Commercial Products and Commercial Services” at beginning. Subsec. (a). Pub. L. 116–283, § 1834(f)(1)(B), (4), after transfer of section 2307(f) of this title to this section, redesignated par. (1) as subsec. (a), inserted heading, and substituted “section 3801 of this title” for “subsection (a)”. Subsec. (b). Pub. L. 116–283, § 1834(f)(4), inserted heading. Pub. L. 116–283, § 1834(f)(2), which directed the designation of “the second sentence of subsection (a) as subsection (b)”, was executed by designating the second and third sentences of subsec. (a) as (b), to reflect the probable intent of Congress. Subsec. (c). Pub. L. 116–283, § 1834(f)(1)(B), (5), after transfer of section 2307(f) of this title to this section, redesignated par. (2) as subsec. (c), inserted heading, and substituted “section 3801 of this title” for “subsection (a)”. Subsec. (d). Pub. L. 116–283, § 1834(f)(1)(B), (6), after transfer of section 2307(f) of this title to this section, redesignated par. (3) as subsec. (d), inserted heading, and substituted “section 3803 and 3804 of this title” for “subsections (d) and (e)” and “this section” for “paragraphs (1) and (2)”.

Statutory Notes and Related Subsidiaries

Effective Date

Section and amendment by Pub. L. 116–283 effective Jan. 1, 2022, with additional provisions for delayed implementation and applicability of existing law, see section 1801(d) of Pub. L. 116–283, set out as an

Effective Date

of 2021 Amendment note preceding section 3001 of this title.

§3805 Payments for Commercial Products and Commercial Services

Summary

Title 10, §3805

Notes & Related Subsidiaries

Editorial Notes

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Citations & Metadata