This legislation, titled the "Freedom from Government Competition Act of 2025," establishes a policy requiring federal agencies to rely on the private sector for goods and services. It asserts that competitive private enterprises are the most productive and efficient sources, and that unfair government competition is detrimental to the United States economic system. The bill aims to ensure that the Federal Government does not compete with its citizens, instead utilizing commercial sources for its operational needs.

The general rule mandates that each agency obtain all necessary goods and services from private sources, with specific exemptions. These exemptions apply if goods or services are legally required to be produced by the agency, or if the agency head certifies that federal production is necessary for national defense or homeland security, is critical to the agency's mission or inherently governmental, or if no private source is capable of providing them. Federal employees are to perform inherently governmental functions.

For non-exempt goods and services, procurement from the private sector must occur through methods such as divestiture of federal involvement, awarding competitive contracts, or conducting a public-private competitive sourcing analysis to determine the best value for taxpayers. The Director of the Office of Management and Budget (OMB) is tasked with promulgating regulations to carry out these provisions, ensuring compliance even for State and territorial entities expending Federal funds.

Furthermore, the bill requires the OMB Director, in consultation with the Comptroller General, to conduct an annual study and submit a report to Congress. This report must evaluate justifications for exemptions and provide a schedule for transferring commercial activities to the private sector, with a goal of completion within five years of each report's transmission.