Part 2Single source contracts
Pricing of contracts
18Contract profit rate: supplementary
(1)
The Secretary of State or an authorised person, and the primary contractor, must have regard to guidance issued by the SSRO in relation to any of the steps set out in section 17(2).
(2)
Single source contract regulations may—
(a)
(b)
provide for any or all of those steps to apply in relation to such a contract F3or component with modifications set out in the regulations;
(c)
where the Secretary of State is a party to a group of qualifying defence contracts with the same primary contractor, provide for section 17(2) to apply in relation to those contracts F4or components of those contracts—
(i)
taken together or individually, and
(ii)
with such modifications as may be set out in the regulations.
(3)
Single source contract regulations may provide that the SSRO—
F5(a)
may, on an application by a person within subsection (4), determine whether—
(i)
the baseline profit rate identified under step 1 in section 17(2) is correct in relation to a qualifying defence contract or a component of such a contract;
(ii)
an adjustment agreed under any of steps 2 to 4 in section 17(2) is appropriate;
(iii)
an adjustment agreed under step 3 in section 17(2) is in accordance with the regulations;
(b)
may, in consequence of a determination by virtue of paragraph (a) that the amount of such an adjustment is not appropriate, determine that the price payable under the contract is to be adjusted by an amount specified by the SSRO.
(4)
The following persons are within this subsection—
(a)
the Secretary of State,
(b)
an authorised person, and
(c)
the primary contractor.