(a) Applicability. This section applies when the contract contains the basic clause 552.238-80 Industrial Funding Fee and Sales Reporting.

(b) The basic clause and Alternate I of 552.238-81, Price Reductions, requires the contractor to maintain during the contract period the negotiated price/discount relationship (and/or term and condition relationship) between the eligible ordering activities and the offeror's customer or category of customers on which the contract award was predicated (see 538.271(c)). If a change occurs in the contractor's commercial pricing or discount arrangement applicable to the identified commercial customer (or category of customers) that results in a less advantageous relationship between the eligible ordering activities and this customer or category of customers, the change constitutes a “price reduction.”

(c) Ensure that the contractor understands the requirements of section 552.238-81 and agrees to report all price reductions to the Contracting Officer as provided for in the clause.

[81 FR 41137, June 23, 2016, as amended by 84 FR 17039, Apr. 23, 2019; 85 FR 62613, Oct. 5, 2020]