Written and maintained by CASRAI Editorial Board
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FAR Part 12 is the part of the Federal Acquisition Regulation titled “Acquisition of Commercial Products and Commercial Services.” It tells a federal contracting officer how to buy things the open market already sells, with streamlined terms instead of the full set of government-unique requirements. Research offices, lab managers and vendors to federal agencies meet it whenever a purchase is made by contract rather than by grant. Facts here are as described on the official acquisition.gov pages on 2026-10-29, and the guide keeps two versions of the text apart: the codified regulation and the separate “FAR Overhaul” deviation text.
What FAR Part 12 is and who runs it
The FAR is the government-wide rulebook for acquisition by executive agencies, published at acquisition.gov. Part 12 is its commercial-buying part. The codified version (Federal Acquisition Circular 2026-01, effective 03/13/2026) is organised into six subparts:
- 12.1 Acquisition (12.101 to 12.103): policy, applicability and commercial off-the-shelf (COTS) items.
- 12.2 Special Requirements (12.201 to 12.216), which includes contract type at 12.207.
- 12.3 Solicitation Provisions and Contract Clauses (12.300 to 12.303), which includes tailoring at 12.302.
- 12.4 Unique Requirements Regarding Terms and Conditions (12.401 to 12.404).
- 12.5 Applicability of Certain Laws (12.500 to 12.505).
- 12.6 Streamlined Procedures for Evaluation and Solicitation (12.601 to 12.603).
The policy in 12.101 has three parts: agencies conduct market research to find out whether commercial products, commercial services or nondevelopmental items are available; they acquire them when they are; and they require prime contractors and subcontractors at all tiers to incorporate them “to the maximum extent practicable.”
A separate page on acquisition.gov, the FAR Overhaul Part 12 deviation guide (last updated 10/26/2026), presents rewritten text. That page is not the codified regulation; it applies, in its own words, when the Revolutionary FAR Overhaul turns to rule-making. Every fact below is labelled with the version it comes from.
Scope: when Part 12 applies and when it does not
Under codified 12.102(a), Part 12 “shall be used for the acquisition of supplies or services that meet the definitions of ‘commercial product’ or ‘commercial service’ at 2.101.” The definitions live in 2.101, not in Part 12 itself. Under 12.102(b) it is used together with Part 13, 14 or 15 as appropriate, so Part 12 does not replace the choice of procedure; it adjusts the terms.
The precedence rule
Other FAR parts still apply to a commercial acquisition. But 12.102(c) says that when a policy in another part of the FAR is inconsistent with a policy in Part 12, “this part shall take precedence.” It is easy to miss, and it decides which part wins in a conflict.
What Part 12 does not cover
Codified 12.102(e) lists five situations where Part 12 does not apply. These are acquisitions:
- at or below the micro-purchase threshold;
- using Standard Form 44;
- using the imprest fund;
- using the Governmentwide commercial purchase card as a method of purchase (rather than only as a method of payment);
- directly from another Federal agency.
Two further provisions matter at the edges. Under 12.102(d), “purposes other than governmental purposes” means purposes not unique to a government. Under 12.102(f), a head of agency may treat acquisitions for defense against, or recovery from, a cyber, nuclear, biological, chemical or radiological attack as commercial; a sole-source acquisition over $25 million that does not meet the 2.101 definition is still subject to the Cost Accounting Standards (subpart 30.2) and to certified cost or pricing data (15.403). For COTS items, 12.103 says the commercial-product policies apply unless indicated otherwise, and 12.505 lists laws that do not apply to COTS in addition to those at 12.503 and 12.504.
What Part 12 requires: contract type and terms
Codified 12.207(a) says commercial acquisitions use “firm-fixed-price contracts or fixed-price contracts with economic price adjustment,” subject to the exceptions in 12.207(b). The Overhaul text is blunter: 12.104(a) says, to the maximum extent practicable, to use firm-fixed-price or fixed-price with economic price adjustment, and 12.104(d) says “Do not use any cost-reimbursement contract type to procure commercial products or commercial services.” For a research office, that is the main practical contrast with a cost-reimbursable award, where allowable costs are billed after the fact (see cost-reimbursable contract).
Subpart 12.3 covers solicitation provisions and contract clauses, and 12.302 covers tailoring them. Subpart 12.4 sets out terms and conditions unique to commercial buying. The Overhaul text states, at 12.401(b), that “Micro-purchases do not require written provisions or clauses,” and at 12.403(c) says an imprest fund transaction shall not exceed $500 (or other limits approved by the agency head) and a third-party draft transaction shall not exceed $2,500 unless authorized at a higher level.
Codified text versus the FAR Overhaul text
The two sources describe the same part in different words, and only one is in force as codified. This table keeps them apart.
| Topic | Codified Part 12 (FAC 2026-01, effective 03/13/2026) | FAR Overhaul Part 12 (deviation guide, updated 10/26/2026; not codified) |
|---|---|---|
| Contract type | 12.207(a): firm-fixed-price or fixed-price with economic price adjustment, subject to 12.207(b) | 12.104(a): same two types “to the maximum extent practicable”; 12.104(d): no cost-reimbursement contract type |
| Procedure up to a dollar ceiling | 12.102(b): used with Part 13, 14 or 15 as appropriate | 12.201-1(a): for acquisitions valued up to $9 million, issue a request for quotations (RFQ) followed by a purchase order; above $9 million, 12.201-2 applies with Part 14 or 15 |
| Higher ceiling | No equivalent ceiling in the codified text cited here | 12.001(c): $9 million rises to $15 million for specified purposes (contingency operations, emergency response) as determined by the agency head |
| Cost Accounting Standards | 12.102(f): sole-source over $25 million that does not meet the 2.101 definition is not exempt from CAS or certified cost or pricing data | 12.109: CAS do not apply to contracts or subcontracts for commercial products or commercial services; 12.001(b) repeats the over-$25 million sole-source exception |
| Data rights | No equivalent presumption in the codified text cited here | 12.106: presume that data delivered under a contract for commercial products was developed exclusively at private expense |
The Overhaul page states no effective date and no redline against the current FAR.
Compliance steps for a commercial acquisition
The sources imply an order of work, drawn from the sections above rather than from a single checklist:
- Market research (12.101). Establish whether commercial products, commercial services or nondevelopmental items can meet the need.
- Test the definition (12.102(a)). Check the item against the 2.101 definitions of commercial product and commercial service.
- Check the exclusions (12.102(e)). Micro-purchases, SF 44, imprest fund, purchase card as a method of purchase, and purchases from another agency sit outside Part 12.
- Pick the procedure (12.102(b)). Part 13, 14 or 15 as appropriate; under the Overhaul text, an RFQ and purchase order up to $9 million.
- Set the contract type (12.207). Firm-fixed-price or fixed-price with economic price adjustment.
- Tailor the terms (12.302). Apply the provisions and clauses of subpart 12.3, adjusted as 12.302 allows.
When a paper solicitation is used and the acquisition is expected to exceed the simplified acquisition threshold, the form is usually SF 1449; see the SF 1449 guide for the form’s block map, which this page does not repeat.
Typical timeline phases
The regulation sets no calendar durations for these steps, so the phases below are sequence only:
- Need and market research: the agency decides what it needs and checks the open market.
- Solicitation: a request for quotations or an offer solicitation, depending on the procedure chosen.
- Evaluation: quotations or offers are assessed under the procedure chosen.
- Award and order: a firm-fixed-price or fixed-price contract, or a purchase order under the Overhaul text.
Common mistakes
- Treating Part 12 as a replacement for Part 13, 14 or 15. 12.102(b) says it is used with them.
- Quoting the Overhaul text as current rule. The $9 million RFQ ceiling and the 12.104(d) cost-reimbursement bar come from a page that is not codified; the codified 12.207 is the version in force as of FAC 2026-01.
- Assuming commercial means exempt from everything. Under 12.102(c) other parts still apply except where they conflict with Part 12, and a sole-source acquisition over $25 million that fails the 2.101 definition is not exempt from CAS or certified cost or pricing data.
- Applying Part 12 to a micro-purchase or a purchase-card buy. Both are listed in 12.102(e) as outside it.
- Confusing a grant purchase with a contract purchase. Grant-funded purchases are governed by the award’s own rules, not the FAR; see the comparison of supplies and equipment under 2 CFR 200.
Related programs and FAR parts
| Related rule | How it connects to Part 12 (source) | CASRAI guide |
|---|---|---|
| FAR Part 13, 14, 15 | 12.102(b): Part 12 is used with one of these as appropriate | GSA Schedule vs. open-market purchasing |
| Subpart 30.2, Cost Accounting Standards | 12.102(f) carves out over-$25 million sole-source buys; Overhaul 12.109 excludes commercial contracts | FAR Part 31 vs. 2 CFR 200 |
| FAR 15.403, certified cost or pricing data | 12.102(f): not exempt for the over-$25 million sole-source case | TINA threshold |
| SF 1449 (12.204) | The form for commercial solicitations and contracts | SF 1449 guide |
Frequently asked questions
What is FAR Part 12?
It is the part of the Federal Acquisition Regulation for acquiring commercial products and commercial services. It requires market research first, prefers commercial items, and takes precedence over inconsistent policy elsewhere in the FAR (12.101, 12.102(c)).
Does Part 12 apply to purchase-card buys?
Not when the card is the method of purchase. 12.102(e)(4) excludes use of the Governmentwide commercial purchase card as a method of purchase rather than only payment, and 12.102(e)(1) excludes acquisitions at or below the micro-purchase threshold.
Can a commercial acquisition be cost-reimbursement?
Under codified 12.207(a) the contract type is firm-fixed-price or fixed-price with economic price adjustment, subject to 12.207(b). The Overhaul text, 12.104(d), says not to use any cost-reimbursement type.
What is the $9 million figure in the FAR Overhaul?
It is the ceiling in Overhaul 12.201-1(a) up to which an agency issues an RFQ followed by a purchase order. Under 12.001(c) it rises to $15 million where the head of the agency determines the supplies or services support a contingency operation, defense against or recovery from specified attacks, international disaster assistance, or response to an emergency or major disaster. It is not codified text.
Does the Cost Accounting Standards requirement apply to commercial contracts?
The Overhaul text, 12.109, says CAS do not apply to commercial contracts or subcontracts. The exception in 12.102(f) and 12.001(b) keeps a sole-source acquisition over $25 million that does not meet the 2.101 definition subject to CAS and to certified cost or pricing data.
For related federal buying topics, see the GSA Advantage ordering guide and the Section 889 compliance guide.
Sources
- FAR Part 12 and Subpart 12.1, Acquisition of Commercial Products and Commercial Services (codified, FAC 2026-01, effective 03/13/2026): https://www.acquisition.gov/far/part-12, checked 2026-10-29.
- FAR Overhaul Part 12, deviation guide (last updated 10/26/2026; not codified): https://www.acquisition.gov/far-overhaul/far-part-deviation-guide/far-overhaul-part-12, checked 2026-10-29.
