GSA’s new AI acquisition policy is an interim contract clause, GSAR 552.239-7001, for covered procurements involving large language model (LLM) functionality and Government Data. It is not a rule for every contractor use of AI: whether it applies depends on what the Government is procuring, how material the LLM feature is, and whether Government Data is processed. The clause is part of GSA’s RGO-2026-01 class deviation, pending formal rulemaking.
What is GSA’s new AI acquisition policy?
The operative policy is GSAR 552.239-7001, titled “Basic Safeguarding of Data within Large Language Model Artificial Intelligence Systems.” GSA included it in RGO-2026-01, a class deviation from the General Services Acquisition Regulation (GSAR). GSAR 539.71 prescribes the clause for covered solicitations and contracts, including those for commercial products and services.
A class deviation tells the acquisition workforce to use deviation text in place of corresponding codified GSAR text while the regulatory framework is being updated. The January 15, 2026 RGO memorandum says GSA plans to follow with formal rulemaking, including notice and comment. The deviation is therefore interim; it is not a completed final rule.
Which purchases fall within the clause?
The clause is aimed at a Government procurement where an LLM feature is material and Government Data will be submitted to or produced by the LLM. Its examples include LLMs, generative assistants, chatbots, agentic systems, LLM-enabled document or productivity tools, and similar systems. A contracting officer may also identify systems for coverage.
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|---|---|
| The Government is procuring an AI system or a tool with an LLM feature | Check whether LLM functionality is a material feature and whether Government Data is submitted to or generated by it. Those conditions are central to the clause’s stated scope. |
| A contractor uses an internal business, back-office, operational, or performance-support tool | The clause provides an exception for specified internal uses that are not delivered to or accessed by the Government. That is a limited exception, not a blanket exemption for contractor AI use. |
| A procured product includes an incidental or ancillary LLM feature | The clause provides an exception under its specified conditions. Incidental functionality should not be treated as automatically covered or automatically exempt; check the clause conditions and the contracting officer’s determination. |
In practical terms, a contractor’s use of an AI tool somewhere in its business is not by itself enough to establish coverage. The question is whether the Government is procuring the relevant system or functionality, whether the LLM feature is material, and how Government Data is involved.
What does the clause require about data and ownership?
The clause defines Government Data as Data Inputs and Data Outputs. Inputs can include Government prompts, queries, instructions, documents, knowledge bases, Government email addresses, and account information. Outputs include content generated in contract performance as well as changes or derivatives of inputs. The clause separately defines Background Data and excludes it from the Government Data definition.
It addresses Government ownership of Government Data and custom developments while distinguishing contractor background intellectual property that existed beforehand or was independently developed. It does not say that GSA takes ownership of a vendor’s entire model or all of its pre-existing materials.
What responsibilities and oversight rights does it set?
Prime contractors and applicable subcontractors
The prime contractor is responsible for implementing the clause. It must flow down specified provisions to applicable subcontractors involved in designing, developing, deploying, operating, or monitoring an LLM that processes Government Data, to the extent those subcontractors handle that data. The clause includes specific exceptions concerning open model components; those exceptions should not be generalized to every open-weight model.
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The Government may conduct automated LLM assessments addressing matters such as bias, truthfulness, safety, unsolicited ideological content, and other factors determined by the Government. This is a contractual evaluation right; it does not establish that any particular system has failed an assessment.
The clause also requires notice of certain material changes within seven calendar days. For factual responses, it directs contractors to use reasonable efforts to design, train, and configure the LLM to prioritize accuracy, scientific inquiry, and objectivity, and to acknowledge uncertainty where reliable information is incomplete or contradictory.
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Suspension
The clause states: “The Government retains the right to suspend use of the LLM at any time.” That is a reserved contractual authority, not a finding that a system has been suspended.
Termination-related decommissioning costs
A specific cost remedy applies if the contracting officer terminates for cause because the contractor failed to remediate after specific written notice. In that circumstance, the contractor is liable for reasonable decommissioning costs. Re-procurement costs, replacement-system development, and unrelated costs are excluded, and liability is capped at 25% of the value of the affected task or delivery order.
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When does the policy apply to new and existing contracts?
RGO-2026-01, dated January 15, 2026, gives general implementation instructions for GSAR changes: they ordinarily apply to solicitations issued on or after the applicable change’s effective date. Contracting officers may include changes in earlier solicitations when resulting awards occur on or after that date, and may include changes in existing contracts with appropriate consideration. The memorandum also leaves officers discretion over implementation in open solicitations and awarded contracts.
Separately, FedScoop reported on October 1, updated October 2, 2026, that the AI class deviation was available for immediate use and had an October 19, 2026 effective date. Those are reported timing details; they should not be confused with the January memorandum’s general rules for implementing GSAR changes. The formal rulemaking timetable was still unknown in that report. For a live procurement, check the current official RGO text and the acquisition’s solicitation or contract documents, since the officer’s implementation decision and the applicable dates matter.
- Identify the acquisition document. Check the solicitation, amendments, award, and any applicable modifications for clause 552.239-7001 and related GSAR deviation text.
- Check the dates. Compare the solicitation and award dates with the clause’s stated effective date and any implementation direction in the acquisition.
- Confirm the scope. Determine whether the acquired system has material LLM functionality and whether Government Data is submitted to or produced by it; review any stated exception or contracting officer direction.
- Resolve existing-contract questions with the contracting officer. The memorandum allows discretion for open solicitations and awarded contracts, so do not assume the clause was added automatically to an earlier award.
How is this different from GSA’s internal AI policy?
GSA CIO 2185.1C is a separate internal directive on responsible AI use within GSA. It is active, was signed March 11, 2026, and has an expiration date of March 30, 2029; it superseded CIO 2185.1B. It addresses AI systems or services acquired by or on behalf of GSA, with an exclusion for common commercial products with embedded AI that are not primarily used for AI purposes. It is not the GSAR contract clause and should not be treated as a substitute for its terms.
Why is GSA addressing AI acquisition terms now?
GAO’s report, published April 13, 2026, reviewed federal AI acquisitions through fiscal year 2025 and described varied approaches, including new contracts and agreements outside the federal acquisition regulations. It identified acquisition challenges involving requirements and contract terms, early testing and continuous evaluation, and AI pricing and overall cost. GAO recommended systematic collection and sharing of acquisition lessons by GSA, DOD, DHS, and VA through a GSA-managed repository; the agencies concurred.
GAO’s report attributes to the Federal Chief Information Officer the statement that agencies reportedly more than doubled their AI use from 2023 to 2024. It also reports that industry leads AI development, with more than $250 billion invested in 2024 alone. These figures provide context for the acquisition challenge; they are not evidence that this particular clause has produced savings or changed contract outcomes.
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