# GSA Sets AI Acquisition Rules

GSA issued class-deviation clause 552.239-7001 for federal acquisitions involving AI, making it available for immediate use by contracting officers and setting October 19, 2026, as its effective date. The clause applies when large language model functionality is a material feature and Government Data is submitted to or produced by the model. Covered contractors and relevant subcontractors must protect Government Data, including by prohibiting its use for model training, advertising, or third-party sale and implementing specified security, disclosure, incident-reporting, model-change, and closeout controls. Internal back-office uses and products with incidental LLM functionality may be outside scope; contracting officers may also apply the clause to existing contracts at their discretion.

- With the effective date **16 days away**, contractors should identify covered AI systems and subcontractors, assess data flows and existing controls, and prepare the required reporting and disclosure processes.
- The clause includes NIST AI Risk Management Framework-based subcontract flow-downs, government testing and suspension rights, expanded contractor intellectual-property protections, and capped decommissioning liability. Suppliers should account for these terms in proposal assumptions, subcontract terms, and contract-performance planning.
- Contracting officers can use the clause in new procurements now and may incorporate it into existing contracts at their discretion, so contractors should assess both upcoming bids and current contract exposure.

**Jurisdictions:** federal
**Industries:** Information Technology
**Topics:** Artificial Intelligence, Regulatory Compliance
**Published:** October 03, 2026

### Government Entities
- General Services Administration (GSA)
- National Institute of Standards and Technology (NIST)

### Key Quotes
> The AI clause changed in ways industry asked for. It self-deletes when LLM use stays inside the contractor's own back-office systems, or when LLM functionality is incidental to a product the Government isn't using for AI. Flowdown reaches only subcontractors who design, develop, deploy or operate the model.
> — Kevin Martin, Program Manager

> GSA’s final AI terms and conditions mark a significant improvement from prior draft versions, and establishes a stronger foundation for safeguarding government data in AI systems.
> — Quinn Anex-Ries, Senior Policy Analyst

### Sources
- [GSA memo to set AI-specific acquisition rules - Nextgov/FCW](https://www.nextgov.com/acquisition/2026/10/gsa-memo-set-ai-specific-acquisition-rules/416378) - Nextgov/FCW
- [GSA issued an AI acquisition policy for new contracts. Here’s what it says. | FedScoop](https://fedscoop.com/gsa-issued-an-ai-acquisition-policy-for-new-contracts-heres-what-it-says) - FedScoop
- [Inside GSA’s new AI acquisition policy | FedScoop](https://fedscoop.com/radio/the-general-services-administration-has-issued-its-artificial-intelligence-acquisition-clause-as-a-class-deviation-from-its-regulations) - FedScoop