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GSA’s new AI acquisition requirement is clause GSAR 552.239-7001, “Basic Safeguarding of Data within Large Language Model Artificial Intelligence Systems.” It appears in class deviation RGO-2026-01, an interim departure from the GSAR while GSA undertakes formal rulemaking. The clause is not a blanket rule for every contractor’s AI use or every federal contract: its coverage depends on what the Government is procuring, whether large language model (LLM) functionality is material, and whether Government Data is submitted to or produced by the LLM.
For a particular acquisition, check the solicitation and contract for the clause, its effective-date treatment, and any direction from the contracting officer. FedScoop reported on October 1, updated October 2, 2026, that the clause 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 broader implementation instructions in the January RGO memorandum.
What GSA issued—and what “interim” means
RGO-2026-01, dated January 15, 2026, approves class deviations to the General Services Acquisition Regulation (GSAR). The GSAR is the regulatory part of GSA’s acquisition system. Under the memorandum, GSA’s acquisition workforce is to follow the applicable deviation text instead of the corresponding codified GSAR text while the overhaul continues. GSA says formal rulemaking, including notice and comment, will follow; RGO-2026-01 is therefore an interim acquisition measure, not a completed final rule. (GSA, RGO-2026-01.)
The AI provision is prescribed by GSAR 539.71. Its clause heading in the September 2026 deviation text is “Basic Safeguarding of Data within Large Language Model Artificial Intelligence Systems.” It can apply to covered solicitations and contracts, including those for commercial products and services, when the clause’s conditions are met. (GSA, GSAR 552.239-7001, GSAR Deviation, September 2026.)
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Which purchases fall within the clause?
Think of coverage as a combination of what the Government is buying and how the LLM feature handles data—not simply whether a contractor uses AI somewhere in its business.
| Question | What points toward coverage | What may place a use outside the stated conditions |
|---|---|---|
| Is the Government procuring an LLM-based system or capability? | The clause names LLMs, generative assistants, chatbots, agentic systems, LLM-enabled document or productivity tools, and similar systems. | A contractor’s internal business, back-office, operational, or performance-support tool may be excluded when it is not delivered to or accessed by the Government. |
| Is LLM functionality material, and does the LLM handle Government Data? | Coverage is implicated when LLM functionality is a material feature and Government Data is submitted to or produced by the LLM. | Incidental or ancillary LLM functionality may fall outside the clause under its specified conditions. The contracting officer may also identify systems for coverage. |
These exceptions are conditional, not a general exemption for “contractor AI.” A tool used to support contract performance is not automatically outside the clause: the stated exception turns on whether it is delivered to or accessed by the Government, and the clause separately addresses incidental or ancillary functionality. Review the acquisition’s actual requirements and clause language to determine how those conditions apply. (GSA, GSAR 552.239-7001.)
What the clause says 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 to or derivatives of inputs. The clause separately defines Background Data and excludes it from Government Data.
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It addresses Government ownership of Government Data and custom developments while distinguishing pre-existing or independently developed contractor background intellectual property. That distinction matters: the clause does not say GSA acquires ownership of a contractor’s entire model or all of its pre-existing materials. (GSA, GSAR 552.239-7001.)
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Contractor duties, subcontractors, and model components
The prime contractor is responsible for implementing the clause. Specified provisions must flow down to applicable subcontractors involved in AI design, development, deployment, operation, or monitoring connected to an LLM that processes Government Data, to the extent those subcontractors handle such data. The flowdown is therefore tied to the relevant work and data handling, rather than automatically applying to every subcontractor.
The clause also treats open model components under specific exceptions. Those exceptions should not be read as a blanket carve-out for all open-weight models; assess the actual component and the clause’s conditions. (GSA, GSAR 552.239-7001.)
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Evaluation, changes, and suspension
The clause gives the Government the right to conduct automated assessments of an LLM. The listed areas include bias, truthfulness, safety, unsolicited ideological content, and other factors the Government determines. This is a contractual evaluation right; it does not establish that any particular system has failed an assessment.
Contractors must provide notice of certain material changes within seven calendar days. The clause also states: “The Government retains the right to suspend use of the LLM at any time.” That is a reserved contractual authority, not evidence that a suspension has occurred. (GSA, GSAR 552.239-7001.)
What happens if a contractor does not remediate?
The cost consequence described in the clause is conditional. If the contracting officer terminates for cause because the contractor failed to remediate after specific written notice, the contractor is liable for reasonable decommissioning costs. Re-procurement costs, development of a replacement system, and unrelated costs are excluded. Liability is capped at 25% of the value of the affected task or delivery order. The cap and exclusions are terms in the clause, not a reported measure of actual costs. (GSA, GSAR 552.239-7001.)
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When does the policy apply to new and existing contracts?
Two timing rules need to be kept distinct: the general implementation direction in RGO-2026-01 and the later date reported for this AI clause.
| Situation | What the available direction says |
|---|---|
| Solicitation issued on or after a change’s effective date | Under RGO-2026-01’s general instruction, the GSAR change applies. |
| Earlier solicitation, with award on or after the effective date | A contracting officer may include the change in the earlier solicitation. |
| Open solicitation or already-awarded contract | The memorandum leaves implementation to contracting-officer discretion; changes to an existing contract may be included with appropriate consideration. |
| This AI clause’s reported timing | FedScoop reported October 1, updated October 2, 2026, that it could be used immediately and had an October 19, 2026 effective date. The formal rulemaking timetable was reported as unknown at that time. |
The October 19 date is a reported detail about this clause; the earlier rows summarize the January memorandum’s general instructions. For an acquisition decision, check the current official RGO text and the solicitation or contract, and confirm implementation with the contracting officer. (GSA, RGO-2026-01; FedScoop, October 1, updated October 2, 2026.)
How this differs from GSA’s internal responsible-AI directive
GSA CIO 2185.1C is a separate agency directive about responsible AI use within GSA, not the GSAR contract clause. It is active, was signed March 11, 2026, expires March 30, 2029, and supersedes CIO 2185.1B. It covers 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. Its internal-agency scope should not be conflated with the contract terms in GSAR 552.239-7001. (GSA, CIO 2185.1C.)
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Why GSA is addressing AI acquisition terms
GAO’s April 13, 2026 report, covering agency acquisitions reviewed through fiscal year 2025, describes varied approaches to acquiring AI, including new contracts and agreements outside the federal acquisition regulations. It identifies practical acquisition challenges such as defining requirements and contract terms, arranging early testing and continuous evaluation, and understanding AI pricing and total cost. GAO recommended that GSA, the Department of Defense, the Department of Homeland Security, and the Department of Veterans Affairs systematically collect acquisition lessons and share them through a GSA-managed repository; the agencies concurred.
GAO’s report also relayed that federal agencies reportedly more than doubled their use of AI from 2023 to 2024, attributing that figure to the Federal Chief Information Officer, and that industry reportedly invested more than $250 billion in AI in 2024. Those figures describe broader developments, not evidence that this GSA clause has produced savings or changed acquisition outcomes. (GAO-26-107859, April 13, 2026.)
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