Performance-Based Service Acquisition (PBSA), formerly known as Performance-Based Service Contract (PBSC), is defined in FAR 37.601. PBSA applies if the contract:

• Describes the requirements in terms of results required rather than the methods of performance of the work
  
  • For FY 2005 and later a minimum of 50% of the requirements under the procurement action must meet the FAR standards
  • For FY 2004 and prior, a minimum of 80% of the requirements under the procurement action must meet the FAR standards
•  Uses measurable performance standards (i.e., terms of quality, timeliness, quantity, etc.) and quality assurance surveillance plans (see 46.103(a) and 46.401(a))
• Specifies procedures for reductions of fee or for reductions to the price of a fixed-price contract when services are not performed or do not meet contract requirements (see 46.407) and 
• Includes performance incentives where appropriate.