(1) Under the law, an agency that considers contracting for services historically and customarily performed by state employees shall determine whether a competitive market exists for the service.

(2) For the purposes of this chapter, a competitive market exists when there are two or more separate businesses, individuals, nonprofit organizations, or other entities capable of providing the services being considered for competitive contracting.

(3) Agencies shall not consider an employee business unit as an entity capable of providing the service when determining the existence of a competitive market for that service.