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Title 41 — Public ContractsRelease 119-73not60

§3501 General

Title 41 › Subtitle Subtitle I— Federal Procurement Policy › Chapter 35— TRUTHFUL COST OR PRICING DATA › § 3501

Last updated Apr 5, 2026|Official source

Summary

Defines two key terms and says when some services can be treated as commercial. "Cost or pricing data" means the factual information, as of the agreed price date (or another date agreed under 3506(a)(2)), that a reasonable buyer or seller would expect to affect price talks. "Subcontract" includes transfers of commercial products or services among a contractor’s divisions, subsidiaries, or affiliates. The Federal Acquisition Regulation must allow a service that is not widely sold competitively to be treated as commercial only if the contracting officer writes that the offeror gave enough information to judge the price by price analysis. The officer may ask for prices paid by government and commercial buyers and, if needed, other cost details like labor, materials, and overhead.

Full Legal Text

Title 41, §3501

Public Contracts — Source: USLM XML via OLRC

(a)In this chapter:
(1)The term “cost or pricing data” means all facts that, as of the date of agreement on the price of a contract (or the price of a contract modification) or, if applicable consistent 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 information that is judgmental, but does include factual information from which a judgment was derived.
(2)The term “subcontract” includes a transfer of commercial products or commercial services between divisions, subsidiaries, or affiliates of a contractor or a subcontractor.
(b)(1)The Federal Acquisition Regulation shall ensure that services that are not offered and sold competitively in substantial quantities in the commercial marketplace, but are of a type offered and sold competitively in substantial quantities in the commercial marketplace, may be treated as commercial services for purposes of this chapter only if the contracting officer determines in writing that the offeror has submitted sufficient information to evaluate, through price analysis, the reasonableness of the price for the services.
(2)To the extent necessary to make a determination under paragraph (1), the contracting officer may request the offeror to submit—
(A)prices paid for the same or similar commercial services under comparable terms and conditions by both government and commercial customers; and
(B)if the contracting officer determines that the information described in subparagraph (A) 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.

Legislative History

Notes & Related Subsidiaries

Historical and Revision Notes

Revised SectionSource (U.S. Code)Source (Statutes at Large) 3501(a)41:254b(h).June 30, 1949, ch. 288, title III, § 304A(h), formerly § 304A(i), as added Pub. L. 103–355, title I, § 1251(a)(2), Oct. 13, 1994, 108 Stat. 3284; redesignated as § 304A(h), Pub. L. 104–106, title XLII, § 4201(b)(2)(B), Feb. 10, 1996, 110 Stat. 652. 3501(b)41:254b note.Pub. L. 110–417, [div. A], title VIII, § 868, Oct. 14, 2008, 122 Stat. 4552. Subsection (a) of Pub. L. 110–417, § 868 is omitted as unnecessary. In subsection (b)(1), the words “The Federal Acquisition Regulation” are substituted for “The

Regulations

modified pursuant to subsection (a)” for clarity and conformity with the revised title.

Editorial Notes

Amendments

2018—Subsec. (a). Pub. L. 115–232, § 836(b)(11)(A), redesignated pars. (2) and (3) as (1) and (2), respectively, substituted “commercial products or commercial services” for “commercial items” in par. (2), as redesignated, and struck out former par. (1), which defined “commercial item”. Subsec. (b)(1). Pub. L. 115–232, § 836(b)(11)(B), in heading, struck out “item” before “authority” and, in text, substituted “commercial services” for “commercial items”. Subsec. (b)(2)(A). Pub. L. 115–232, § 836(b)(11)(B)(ii), substituted “commercial services” for “commercial items”.

Statutory Notes and Related Subsidiaries

Effective Date

of 2018 AmendmentAmendment by Pub. L. 115–232 effective Jan. 1, 2020, subject to a

Savings Provision

, see section 836(h) of Pub. L. 115–232, set out as an

Effective Date

of 2018 Amendment;

Savings Provision

note under section 453b of Title 6, Domestic Security.

Reference

Citations & Metadata

Citation

41 U.S.C. § 3501

Title 41 — Public Contracts

Last Updated

Apr 5, 2026

Release point: 119-73not60