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    1. Can the contractor sell this item commercially with the same "name/model" as the government version while the contract is still in force? After the contract has expired? 2. Can the contractor sell this item commercially with a different "name/model" as the government version while the contract is still in force? After the contract has expired? 3. If this contract was a commercial contract the above questions are asked.


    Answer

    FAR Part 12 procedures benefit the Government by allowing use of streamlined acquisition procedures and increasing the availability and price competitiveness of the supplies and services it buys. You describe a situation where the Government bought an item as a non-commercial item, and the contractor subsequently sells the same item in the commercial sector.

    The real issue here is whether the Government should have used FAR Part 12 procedures in the first place to buy the items. That was for the contracting officer to decide, based on the commercial item definition in FAR Part 2. Perhaps the item should have been purchased as a commercial item, or perhaps the Government correctly purchased the item as a non-commercial item and the contractor subsequently determined it could develop a market for it in the commercial sector. There are too many considerations to provide a definitive answer, and it's probably a moot point at this late stage. The contractor can do what it wants with its own products in the commercial sector, unless there is a clause in the contract that gives the Government rights for exclusive use of the product. That is unlikely.

    In general, I don't see any reason why the contractor should not sell this previously "non-commercial" item in the commercial marketplace.

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