Amends the Federal criminal code to revise the requirements for procurement of products of Federal Prison Industries (FPI).

Directs a Federal agency that has a requirement for a specific product listed in the current edition of the FPI catalog to: (1) provide a copy of the required notice to FPI at least 15 days before the issuance of a solicitation of offers for procurement of such product; (2) use competitive procedures (with exceptions); and (3) consider a timely offer from FPI for award in accordance with the specifications and evaluation factors specified in the solicitation.

Requires the agency to: (1) enter into negotiations with FPI on a contract for the purchase of the product on a non-competitive basis if the Attorney General determines it is unreasonable to expect that FPI would be selected on a competitive basis and it is necessary to award the contract to FPI to maintain essential work opportunities or to permit diversification under specified circumstances; and (2) award the contract to FPI if the contracting officer determines that FPI can meet the agency's requirements in a timely manner, at a fair and reasonable price.

Directs FPI to concentrate any effort to produce a new product, or to expand significantly the production of an existing product, on products that are otherwise produced with non-U.S. labor.

Prohibits: (1) the board of FPI from approving a proposal for inmates to provide a service in which an inmate worker has access to specified sensitive information; and (2) requiring subcontracting with FPI..