diff --git a/.github/forced-tests-list.json b/.github/forced-tests-list.json
index 077404aaa41..10e48d04251 100644
--- a/.github/forced-tests-list.json
+++ b/.github/forced-tests-list.json
@@ -1,3 +1,6 @@
 {
-  
+  "SCA_STANDALONE":
+    [
+      "tests/appsec/test_asm_standalone.py::Test_SCAStandalone_Telemetry"
+    ]
 }
\ No newline at end of file
diff --git a/.github/workflows/system-tests.yml b/.github/workflows/system-tests.yml
index d8c8b03534d..fd9bd41393c 100644
--- a/.github/workflows/system-tests.yml
+++ b/.github/workflows/system-tests.yml
@@ -282,6 +282,9 @@ jobs:
           - library: ruby
             app: rails70
             scenario: DEBUGGER_PII_REDACTION
+          - library: ruby
+            app: rails70            
+            scenario: SCA_STANDALONE
           - library: ruby
             app: rack
             scenario: SAMPLING
diff --git a/lib/datadog/appsec/configuration/settings.rb b/lib/datadog/appsec/configuration/settings.rb
index e8ed0a8240a..e5dbecfb0e1 100644
--- a/lib/datadog/appsec/configuration/settings.rb
+++ b/lib/datadog/appsec/configuration/settings.rb
@@ -197,14 +197,6 @@ def self.add_settings!(base)
                 o.type :bool, nilable: true
                 o.env 'DD_APPSEC_SCA_ENABLED'
               end
-
-              settings :standalone do
-                option :enabled do |o|
-                  o.type :bool
-                  o.env 'DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED'
-                  o.default false
-                end
-              end
             end
           end
         end
diff --git a/lib/datadog/appsec/contrib/rack/request_middleware.rb b/lib/datadog/appsec/contrib/rack/request_middleware.rb
index cbb232c00e3..bd27505c4da 100644
--- a/lib/datadog/appsec/contrib/rack/request_middleware.rb
+++ b/lib/datadog/appsec/contrib/rack/request_middleware.rb
@@ -151,8 +151,6 @@ def add_appsec_tags(processor, scope)
             return unless trace && span
 
             span.set_metric(Datadog::AppSec::Ext::TAG_APPSEC_ENABLED, 1)
-            # We add this tag when ASM standalone is enabled to make sure we don't bill APM
-            span.set_metric(Datadog::AppSec::Ext::TAG_APM_ENABLED, 0) if Datadog.configuration.appsec.standalone.enabled
             span.set_tag('_dd.runtime_family', 'ruby')
             span.set_tag('_dd.appsec.waf.version', Datadog::AppSec::WAF::VERSION::BASE_STRING)
 
diff --git a/lib/datadog/appsec/ext.rb b/lib/datadog/appsec/ext.rb
index 30c21b7d240..0f8dddd446f 100644
--- a/lib/datadog/appsec/ext.rb
+++ b/lib/datadog/appsec/ext.rb
@@ -7,7 +7,6 @@ module Ext
       SCOPE_KEY = 'datadog.appsec.scope'
 
       TAG_APPSEC_ENABLED = '_dd.appsec.enabled'
-      TAG_APM_ENABLED = '_dd.apm.enabled'
       TAG_DISTRIBUTED_APPSEC_EVENT = '_dd.p.appsec'
     end
   end
diff --git a/lib/datadog/appsec/utils.rb b/lib/datadog/appsec/utils.rb
index b38ec5b96f5..8e4083533db 100644
--- a/lib/datadog/appsec/utils.rb
+++ b/lib/datadog/appsec/utils.rb
@@ -1,7 +1,5 @@
 # frozen_string_literal: true
 
-require_relative 'utils/trace_operation'
-
 module Datadog
   module AppSec
     # Utilities for AppSec
diff --git a/lib/datadog/appsec/utils/trace_operation.rb b/lib/datadog/appsec/utils/trace_operation.rb
deleted file mode 100644
index 19f2b0b2187..00000000000
--- a/lib/datadog/appsec/utils/trace_operation.rb
+++ /dev/null
@@ -1,15 +0,0 @@
-# frozen_string_literal: true
-
-module Datadog
-  module AppSec
-    module Utils
-      # Utility class to to AppSec-specific trace operations
-      class TraceOperation
-        def self.appsec_standalone_reject?(trace)
-          Datadog.configuration.appsec.standalone.enabled &&
-            (trace.nil? || trace.get_tag(Datadog::AppSec::Ext::TAG_DISTRIBUTED_APPSEC_EVENT) != '1')
-        end
-      end
-    end
-  end
-end
diff --git a/lib/datadog/core/remote/transport/http.rb b/lib/datadog/core/remote/transport/http.rb
index 190a9c45646..c972236b2b3 100644
--- a/lib/datadog/core/remote/transport/http.rb
+++ b/lib/datadog/core/remote/transport/http.rb
@@ -122,7 +122,7 @@ def default_headers
               headers[Datadog::Core::Transport::Ext::HTTP::HEADER_CONTAINER_ID] = container_id unless container_id.nil?
               # Sending this header to the agent will disable metrics computation (and billing) on the agent side
               # by pretending it has already been done on the library side.
-              if Datadog.configuration.appsec.standalone.enabled
+              if Datadog.configuration.tracing.non_billing.enabled
                 headers[Datadog::Core::Transport::Ext::HTTP::HEADER_CLIENT_COMPUTED_STATS] = 'yes'
               end
             end
diff --git a/lib/datadog/tracing/component.rb b/lib/datadog/tracing/component.rb
index 34744e53ef6..e99d49123df 100644
--- a/lib/datadog/tracing/component.rb
+++ b/lib/datadog/tracing/component.rb
@@ -73,12 +73,11 @@ def build_sampler(settings)
           return sampler
         end
 
-        # AppSec events are sent to the backend using traces.
-        # Standalone ASM billing means that we don't want to charge clients for APM traces,
-        # so we want to send the minimum amount of traces possible (idealy only traces that contains security events),
-        # but for features such as API Security, we need to send at least one trace per minute,
+        # This sampler sends the minimum amount of traces possible,
+        # but to show the service on the service catalog, we need to send at least one trace per minute,
         # to keep the service alive on the backend side.
-        if settings.appsec.standalone.enabled
+        # Traces can still be force-kept (e.g. those containing AppSec events).
+        if settings.tracing.non_billing.enabled
           post_sampler = Tracing::Sampling::RuleSampler.new(
             [Tracing::Sampling::SimpleRule.new(sample_rate: 1.0)],
             rate_limiter: Datadog::Core::TokenBucket.new(1.0 / 60, 1.0),
diff --git a/lib/datadog/tracing/configuration/ext.rb b/lib/datadog/tracing/configuration/ext.rb
index 5823d2f9e53..86ef005348f 100644
--- a/lib/datadog/tracing/configuration/ext.rb
+++ b/lib/datadog/tracing/configuration/ext.rb
@@ -12,6 +12,7 @@ module Ext
         ENV_OTEL_TRACES_EXPORTER = 'OTEL_TRACES_EXPORTER'
         ENV_HEADER_TAGS = 'DD_TRACE_HEADER_TAGS'
         ENV_TRACE_ID_128_BIT_GENERATION_ENABLED = 'DD_TRACE_128_BIT_TRACEID_GENERATION_ENABLED'
+        ENV_APM_ENABLED = 'DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED' # Temporary until RFC decides final name
 
         # @public_api
         module SpanAttributeSchema
diff --git a/lib/datadog/tracing/configuration/settings.rb b/lib/datadog/tracing/configuration/settings.rb
index 4b94b6d9eeb..389d1f164db 100644
--- a/lib/datadog/tracing/configuration/settings.rb
+++ b/lib/datadog/tracing/configuration/settings.rb
@@ -150,6 +150,45 @@ def self.extended(base)
                 end
               end
 
+              # Configures tracing non-billing mode configuration
+              #
+              # This rate-limit traces to 1 per minute, to keep the service alive without billing it.
+              # The RFC defines the environment variable as DD_TRACE_APM_ENABLED, we are following a similar name.
+              # As of late November, the RFC is not approved yet but should be soon, hence why we are still
+              # using DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED. DD_TRACE_APM_ENABLED will most likely change.
+              # As we already have a way to completely disable traces, we are using 'non_billing' terminology to
+              # make it clear that this is a non-billing mode, which does NOT completely disables tracing.
+              #
+              # Currently, the env var is DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED
+              # which enables non-billing mode when set to `true`. But the future env var will
+              # enables non-billing mode when set to `false`. so we will have to invert the values
+              # returned by the env_parser block.
+              #
+              # @public_api
+              settings :non_billing do
+                # When set to true (or env var set to false)
+                # sets the rate limit to 1 trace per minute, and prevents billing by adding tags
+                #
+                # @default `DD_TRACE_APM_ENABLED` environment variable, otherwise `true`
+                # @return [Boolean]
+                option :enabled do |o|
+                  o.env Tracing::Configuration::Ext::ENV_APM_ENABLED
+                  o.default false
+                  o.type :bool
+                  o.env_parser do |value|
+                    value = value&.downcase
+                    if ['false', '0'].include?(value)
+                      false
+                    elsif ['true', '1'].include?(value)
+                      true
+                    else
+                      Datadog.logger.warn("Unsupported value for 'non-billing' mode: #{value}. Traces will be sent to Datadog.")
+                      nil
+                    end
+                  end
+                end
+              end
+
               # Comma-separated, case-insensitive list of header names that are reported in incoming and outgoing HTTP requests.
               #
               # Each header in the list can either be:
diff --git a/lib/datadog/tracing/contrib/ethon/easy_patch.rb b/lib/datadog/tracing/contrib/ethon/easy_patch.rb
index 72e2c104f6b..b47d6650c96 100644
--- a/lib/datadog/tracing/contrib/ethon/easy_patch.rb
+++ b/lib/datadog/tracing/contrib/ethon/easy_patch.rb
@@ -110,11 +110,14 @@ def datadog_before_request(continue_from: nil)
 
               datadog_tag_request
 
-              if Datadog::AppSec::Utils::TraceOperation.appsec_standalone_reject?(datadog_trace)
+              if datadog_trace.non_billing_reject?
                 datadog_trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT
               end
 
-              if datadog_configuration[:distributed_tracing]
+              unless Tracing::Distributed::Helpers.should_skip_distributed_tracing?(
+                datadog_configuration,
+                trace: datadog_trace
+              )
                 @datadog_original_headers ||= {}
                 Contrib::HTTP.inject(datadog_trace, @datadog_original_headers)
                 self.headers = @datadog_original_headers
diff --git a/lib/datadog/tracing/contrib/excon/middleware.rb b/lib/datadog/tracing/contrib/excon/middleware.rb
index 9bb3f8629ef..a640f720660 100644
--- a/lib/datadog/tracing/contrib/excon/middleware.rb
+++ b/lib/datadog/tracing/contrib/excon/middleware.rb
@@ -30,10 +30,11 @@ def request_call(datum)
                 trace = Tracing.active_trace
                 datum[:datadog_span] = span
                 annotate!(span, datum)
-                if Datadog::AppSec::Utils::TraceOperation.appsec_standalone_reject?(trace)
-                  trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT
+                trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT if trace.non_billing_reject?
+                if Tracing.enabled? &&
+                    !Tracing::Distributed::Helpers.should_skip_distributed_tracing?(@options, trace: trace)
+                  propagate!(trace, span, datum)
                 end
-                propagate!(trace, span, datum) if distributed_tracing?
 
                 span
               end
diff --git a/lib/datadog/tracing/contrib/faraday/middleware.rb b/lib/datadog/tracing/contrib/faraday/middleware.rb
index 0795ba29b2c..fe8d8770d9c 100644
--- a/lib/datadog/tracing/contrib/faraday/middleware.rb
+++ b/lib/datadog/tracing/contrib/faraday/middleware.rb
@@ -29,10 +29,11 @@ def call(env)
 
             Tracing.trace(Ext::SPAN_REQUEST, on_error: request_options[:on_error]) do |span, trace|
               annotate!(span, env, request_options)
-              if Datadog::AppSec::Utils::TraceOperation.appsec_standalone_reject?(trace)
-                trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT
+              trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT if trace.non_billing_reject?
+              if Tracing.enabled? &&
+                  !Tracing::Distributed::Helpers.should_skip_distributed_tracing?(request_options, trace: trace)
+                propagate!(trace, span, env)
               end
-              propagate!(trace, span, env) if request_options[:distributed_tracing] && Tracing.enabled?
               app.call(env).on_complete { |resp| handle_response(span, resp, request_options) }
             end
           end
diff --git a/lib/datadog/tracing/contrib/grpc/datadog_interceptor.rb b/lib/datadog/tracing/contrib/grpc/datadog_interceptor.rb
index d85095b5599..f3158746471 100644
--- a/lib/datadog/tracing/contrib/grpc/datadog_interceptor.rb
+++ b/lib/datadog/tracing/contrib/grpc/datadog_interceptor.rb
@@ -52,10 +52,6 @@ def analytics_enabled?
               Contrib::Analytics.enabled?(datadog_configuration[:analytics_enabled])
             end
 
-            def distributed_tracing?
-              Datadog.configuration_for(self, :distributed_tracing) || datadog_configuration[:distributed_tracing]
-            end
-
             def analytics_sample_rate
               datadog_configuration[:analytics_sample_rate]
             end
diff --git a/lib/datadog/tracing/contrib/grpc/datadog_interceptor/client.rb b/lib/datadog/tracing/contrib/grpc/datadog_interceptor/client.rb
index eac66872a2b..17c32232381 100644
--- a/lib/datadog/tracing/contrib/grpc/datadog_interceptor/client.rb
+++ b/lib/datadog/tracing/contrib/grpc/datadog_interceptor/client.rb
@@ -81,7 +81,14 @@ def annotate!(trace, span, keywords, formatter)
               # Set analytics sample rate
               Contrib::Analytics.set_sample_rate(span, analytics_sample_rate) if analytics_enabled?
 
-              GRPC.inject(trace, metadata) if distributed_tracing?
+              trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT if trace.non_billing_reject?
+
+              unless Tracing::Distributed::Helpers.should_skip_distributed_tracing?(
+                datadog_configuration,
+                client_config: Datadog.configuration_for(self)
+              )
+                GRPC.inject(trace, metadata)
+              end
               Contrib::SpanAttributeSchema.set_peer_service!(span, Ext::PEER_SERVICE_SOURCES)
             rescue StandardError => e
               Datadog.logger.debug("GRPC client trace failed: #{e}")
diff --git a/lib/datadog/tracing/contrib/http/circuit_breaker.rb b/lib/datadog/tracing/contrib/http/circuit_breaker.rb
index d35ceda5a3e..11f1db27d65 100644
--- a/lib/datadog/tracing/contrib/http/circuit_breaker.rb
+++ b/lib/datadog/tracing/contrib/http/circuit_breaker.rb
@@ -27,21 +27,6 @@ def internal_request?(request)
             !!(request[Datadog::Core::Transport::Ext::HTTP::HEADER_META_TRACER_VERSION] ||
               request[Datadog::Core::Transport::Ext::HTTP::HEADER_DD_INTERNAL_UNTRACED_REQUEST])
           end
-
-          def should_skip_distributed_tracing?(client_config)
-            if Datadog.configuration.appsec.standalone.enabled
-              # Skip distributed tracing so that we don't bill distributed traces in case of absence of
-              # upstream ASM event (_dd.p.appsec:1) and no local security event (which sets _dd.p.appsec:1 locally).
-              # If there is an ASM event, we still have to check if distributed tracing is enabled or not
-              return true unless Tracing.active_trace
-
-              return true if Tracing.active_trace.get_tag(Datadog::AppSec::Ext::TAG_DISTRIBUTED_APPSEC_EVENT) != '1'
-            end
-
-            return !client_config[:distributed_tracing] if client_config && client_config.key?(:distributed_tracing)
-
-            !Datadog.configuration.tracing[:http][:distributed_tracing]
-          end
         end
       end
     end
diff --git a/lib/datadog/tracing/contrib/http/instrumentation.rb b/lib/datadog/tracing/contrib/http/instrumentation.rb
index b913a7d41dd..d736e78c023 100644
--- a/lib/datadog/tracing/contrib/http/instrumentation.rb
+++ b/lib/datadog/tracing/contrib/http/instrumentation.rb
@@ -35,11 +35,15 @@ def request(req, body = nil, &block)
                 span.type = Tracing::Metadata::Ext::HTTP::TYPE_OUTBOUND
                 span.resource = req.method
 
-                if Datadog::AppSec::Utils::TraceOperation.appsec_standalone_reject?(trace)
-                  trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT
-                end
-
-                if Tracing.enabled? && !Contrib::HTTP.should_skip_distributed_tracing?(client_config)
+                trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT if trace.non_billing_reject?
+
+                app_config = Datadog.configuration.tracing[:http]
+                if Tracing.enabled? &&
+                    !Tracing::Distributed::Helpers.should_skip_distributed_tracing?(
+                      app_config,
+                      client_config: client_config,
+                      trace: trace
+                    )
                   Contrib::HTTP.inject(trace, req)
                 end
 
diff --git a/lib/datadog/tracing/contrib/httpclient/instrumentation.rb b/lib/datadog/tracing/contrib/httpclient/instrumentation.rb
index 15c218bf333..3a3e71b7d2d 100644
--- a/lib/datadog/tracing/contrib/httpclient/instrumentation.rb
+++ b/lib/datadog/tracing/contrib/httpclient/instrumentation.rb
@@ -30,11 +30,15 @@ def do_get_block(req, proxy, conn, &block)
                   span.service = service_name(host, request_options, client_config)
                   span.type = Tracing::Metadata::Ext::HTTP::TYPE_OUTBOUND
 
-                  if Datadog::AppSec::Utils::TraceOperation.appsec_standalone_reject?(trace)
-                    trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT
-                  end
-
-                  if Tracing.enabled? && !should_skip_distributed_tracing?(client_config)
+                  trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT if trace.non_billing_reject?
+
+                  app_config = Datadog.configuration.tracing[:httpclient]
+                  if Tracing.enabled? &&
+                      !Tracing::Distributed::Helpers.should_skip_distributed_tracing?(
+                        app_config,
+                        client_config: client_config,
+                        trace: trace
+                      )
                     Contrib::HTTP.inject(trace, req.header)
                   end
 
@@ -123,12 +127,6 @@ def analytics_enabled?(request_options)
               Contrib::Analytics.enabled?(request_options[:analytics_enabled])
             end
 
-            def should_skip_distributed_tracing?(client_config)
-              return !client_config[:distributed_tracing] if client_config && client_config.key?(:distributed_tracing)
-
-              !Datadog.configuration.tracing[:httpclient][:distributed_tracing]
-            end
-
             def set_analytics_sample_rate(span, request_options)
               return unless analytics_enabled?(request_options)
 
diff --git a/lib/datadog/tracing/contrib/httprb/instrumentation.rb b/lib/datadog/tracing/contrib/httprb/instrumentation.rb
index 7d0a11e7ff9..6e75a133500 100644
--- a/lib/datadog/tracing/contrib/httprb/instrumentation.rb
+++ b/lib/datadog/tracing/contrib/httprb/instrumentation.rb
@@ -30,12 +30,18 @@ def perform(req, options)
                   span.service = service_name(host, request_options, client_config)
                   span.type = Tracing::Metadata::Ext::HTTP::TYPE_OUTBOUND
 
-                  if Datadog::AppSec::Utils::TraceOperation.appsec_standalone_reject?(trace)
-                    trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT
+                  trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT if trace.non_billing_reject?
+
+                  app_config = Datadog.configuration.tracing[:httprb]
+                  if Tracing.enabled? &&
+                      !Tracing::Distributed::Helpers.should_skip_distributed_tracing?(
+                        app_config,
+                        client_config: client_config,
+                        trace: trace
+                      )
+                    Contrib::HTTP.inject(trace, req)
                   end
 
-                  Contrib::HTTP.inject(trace, req) if Tracing.enabled? && !should_skip_distributed_tracing?(client_config)
-
                   # Add additional request specific tags to the span.
                   annotate_span_with_request!(span, req, request_options)
                 rescue StandardError => e
@@ -135,12 +141,6 @@ def logger
               Datadog.logger
             end
 
-            def should_skip_distributed_tracing?(client_config)
-              return !client_config[:distributed_tracing] if client_config && client_config.key?(:distributed_tracing)
-
-              !Datadog.configuration.tracing[:httprb][:distributed_tracing]
-            end
-
             def set_analytics_sample_rate(span, request_options)
               return unless analytics_enabled?(request_options)
 
diff --git a/lib/datadog/tracing/contrib/rest_client/request_patch.rb b/lib/datadog/tracing/contrib/rest_client/request_patch.rb
index 4f340c5356d..df0ee1ddf15 100644
--- a/lib/datadog/tracing/contrib/rest_client/request_patch.rb
+++ b/lib/datadog/tracing/contrib/rest_client/request_patch.rb
@@ -25,10 +25,11 @@ def execute(&block)
               return super(&block) unless Tracing.enabled?
 
               datadog_trace_request(uri) do |_span, trace|
-                if Datadog::AppSec::Utils::TraceOperation.appsec_standalone_reject?(trace)
-                  trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT
+                trace.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT if trace.non_billing_reject?
+
+                unless Tracing::Distributed::Helpers.should_skip_distributed_tracing?(datadog_configuration, trace: trace)
+                  Contrib::HTTP.inject(trace, processed_headers)
                 end
-                Contrib::HTTP.inject(trace, processed_headers) if datadog_configuration[:distributed_tracing]
 
                 super(&block)
               end
diff --git a/lib/datadog/tracing/contrib/sidekiq/client_tracer.rb b/lib/datadog/tracing/contrib/sidekiq/client_tracer.rb
index f57fde8a101..c6643bed50d 100644
--- a/lib/datadog/tracing/contrib/sidekiq/client_tracer.rb
+++ b/lib/datadog/tracing/contrib/sidekiq/client_tracer.rb
@@ -24,7 +24,12 @@ def call(worker_class, job, queue, redis_pool)
             resource = job_resource(job)
 
             Datadog::Tracing.trace(Ext::SPAN_PUSH, service: @sidekiq_service) do |span, trace_op|
-              Sidekiq.inject(trace_op, job) if configuration[:distributed_tracing]
+              trace_op.sampling_priority = Tracing::Sampling::Ext::Priority::AUTO_REJECT if trace_op.non_billing_reject?
+
+              if Tracing.enabled? &&
+                  !Tracing::Distributed::Helpers.should_skip_distributed_tracing?(configuration, trace: trace_op)
+                Sidekiq.inject(trace_op, job)
+              end
 
               span.resource = resource
 
diff --git a/lib/datadog/tracing/distributed/helpers.rb b/lib/datadog/tracing/distributed/helpers.rb
index 17bab2dfaaa..7d3667be445 100644
--- a/lib/datadog/tracing/distributed/helpers.rb
+++ b/lib/datadog/tracing/distributed/helpers.rb
@@ -59,6 +59,17 @@ def self.parse_hex_id(value)
 
           num
         end
+
+        def self.should_skip_distributed_tracing?(app_config, client_config: nil, trace: nil)
+          if ::Datadog.configuration.tracing.non_billing.enabled
+            return true unless trace
+            return true if trace.non_billing_reject?
+          end
+
+          return !client_config[:distributed_tracing] if client_config && client_config.key?(:distributed_tracing)
+
+          !app_config[:distributed_tracing]
+        end
       end
     end
   end
diff --git a/lib/datadog/tracing/metadata/ext.rb b/lib/datadog/tracing/metadata/ext.rb
index 95cf3d4e7f0..3b80891d8f3 100644
--- a/lib/datadog/tracing/metadata/ext.rb
+++ b/lib/datadog/tracing/metadata/ext.rb
@@ -31,6 +31,9 @@ module Ext
         # See Datadog-internal "RFC: Identifying which spans have profiling enabled " for details
         TAG_PROFILING_ENABLED = '_dd.profiling.enabled'
 
+        # Set to '0' if 'non-billing' mode is enabled, not present otherwise.
+        TAG_APM_ENABLED = '_dd.apm.enabled'
+
         # Defines constants for trace analytics
         # @public_api
         module Analytics
diff --git a/lib/datadog/tracing/trace_operation.rb b/lib/datadog/tracing/trace_operation.rb
index eb85182af75..7c54c2d5f77 100644
--- a/lib/datadog/tracing/trace_operation.rb
+++ b/lib/datadog/tracing/trace_operation.rb
@@ -71,6 +71,7 @@ def initialize(
         sampling_priority: nil,
         service: nil,
         profiling_enabled: nil,
+        non_billing_enabled: nil,
         tags: nil,
         metrics: nil,
         trace_state: nil,
@@ -98,6 +99,7 @@ def initialize(
         @sampling_priority = sampling_priority
         @service = service
         @profiling_enabled = profiling_enabled
+        @non_billing_enabled = non_billing_enabled
         @trace_state = trace_state
         @trace_state_unknown_fields = trace_state_unknown_fields
         @tracer = tracer
@@ -373,6 +375,14 @@ def fork_clone
         )
       end
 
+      # When APM is running in 'non-billing' mode, we should skip distributed tracing
+      # unless specific distributed tags are present. These tags can come from upstream
+      # services, or from the service itself.
+      # For now, only '_dd.p.appsec=1' is supported.
+      def non_billing_reject?
+        @non_billing_enabled && get_tag(Datadog::AppSec::Ext::TAG_DISTRIBUTED_APPSEC_EVENT) != '1'
+      end
+
       # Callback behavior
       class Events
         include Tracing::Events
@@ -510,6 +520,7 @@ def build_trace(spans, partial = false)
           metrics: metrics,
           root_span_id: !partial ? root_span && root_span.id : nil,
           profiling_enabled: @profiling_enabled,
+          non_billing_enabled: @non_billing_enabled,
         )
       end
 
diff --git a/lib/datadog/tracing/trace_segment.rb b/lib/datadog/tracing/trace_segment.rb
index 6d0903d9a9d..7e05c8122a1 100644
--- a/lib/datadog/tracing/trace_segment.rb
+++ b/lib/datadog/tracing/trace_segment.rb
@@ -34,7 +34,8 @@ class TraceSegment
         :sampling_decision_maker,
         :sampling_priority,
         :service,
-        :profiling_enabled
+        :profiling_enabled,
+        :non_billing_enabled
 
       # rubocop:disable Metrics/CyclomaticComplexity
       # rubocop:disable Metrics/PerceivedComplexity
@@ -58,7 +59,8 @@ def initialize(
         service: nil,
         tags: nil,
         metrics: nil,
-        profiling_enabled: nil
+        profiling_enabled: nil,
+        non_billing_enabled: nil
       )
         @id = id
         @root_span_id = root_span_id
@@ -85,6 +87,7 @@ def initialize(
         @sampling_priority = sampling_priority || sampling_priority_tag
         @service = Core::Utils::SafeDup.frozen_or_dup(service || service_tag)
         @profiling_enabled = profiling_enabled
+        @non_billing_enabled = non_billing_enabled
       end
       # rubocop:enable Metrics/PerceivedComplexity
       # rubocop:enable Metrics/CyclomaticComplexity
diff --git a/lib/datadog/tracing/tracer.rb b/lib/datadog/tracing/tracer.rb
index a6da0e98199..5206bc7f99b 100644
--- a/lib/datadog/tracing/tracer.rb
+++ b/lib/datadog/tracing/tracer.rb
@@ -333,6 +333,7 @@ def build_trace(digest = nil)
           TraceOperation.new(
             hostname: hostname,
             profiling_enabled: profiling_enabled,
+            non_billing_enabled: non_billing_enabled,
             id: digest.trace_id,
             origin: digest.trace_origin,
             parent_span_id: digest.span_id,
@@ -348,6 +349,7 @@ def build_trace(digest = nil)
           TraceOperation.new(
             hostname: hostname,
             profiling_enabled: profiling_enabled,
+            non_billing_enabled: non_billing_enabled,
             remote_parent: false,
             tracer: self
           )
@@ -541,6 +543,10 @@ def profiling_enabled
         @profiling_enabled ||=
           !!(defined?(Datadog::Profiling) && Datadog::Profiling.respond_to?(:enabled?) && Datadog::Profiling.enabled?)
       end
+
+      def non_billing_enabled
+        @non_billing_enabled ||= Datadog.configuration.tracing.non_billing.enabled
+      end
     end
   end
 end
diff --git a/lib/datadog/tracing/transport/http.rb b/lib/datadog/tracing/transport/http.rb
index 190dc31e408..a3b953d0b77 100644
--- a/lib/datadog/tracing/transport/http.rb
+++ b/lib/datadog/tracing/transport/http.rb
@@ -75,7 +75,7 @@ def default_headers
             container_id = Datadog::Core::Environment::Container.container_id
             headers[Datadog::Core::Transport::Ext::HTTP::HEADER_CONTAINER_ID] = container_id unless container_id.nil?
             # Pretend that stats computation are already done by the client
-            if Datadog.configuration.appsec.standalone.enabled
+            if Datadog.configuration.tracing.non_billing.enabled
               headers[Datadog::Core::Transport::Ext::HTTP::HEADER_CLIENT_COMPUTED_STATS] = 'yes'
             end
           end
diff --git a/lib/datadog/tracing/transport/trace_formatter.rb b/lib/datadog/tracing/transport/trace_formatter.rb
index 2140ccebdd0..df634b46a32 100644
--- a/lib/datadog/tracing/transport/trace_formatter.rb
+++ b/lib/datadog/tracing/transport/trace_formatter.rb
@@ -59,6 +59,7 @@ def format!
           tag_high_order_trace_id!
           tag_sampling_priority!
           tag_profiling_enabled!
+          tag_non_billing_enabled!
 
           if first_span
             tag_git_repository_url!
@@ -196,6 +197,14 @@ def tag_profiling_enabled!
           )
         end
 
+        def tag_non_billing_enabled!
+          return unless trace.non_billing_enabled
+
+          root_span.set_metric(
+            Tracing::Metadata::Ext::TAG_APM_ENABLED, 0
+          )
+        end
+
         def tag_git_repository_url!
           return if git_repository_url.nil?
 
diff --git a/sig/datadog/appsec/ext.rbs b/sig/datadog/appsec/ext.rbs
index 2ac545ba1d3..94021af2f29 100644
--- a/sig/datadog/appsec/ext.rbs
+++ b/sig/datadog/appsec/ext.rbs
@@ -5,7 +5,6 @@ module Datadog
       SCOPE_KEY: String
 
       TAG_APPSEC_ENABLED: String
-      TAG_APM_ENABLED: String
       TAG_DISTRIBUTED_APPSEC_EVENT: String
     end
   end
diff --git a/sig/datadog/appsec/utils/trace_operation.rbs b/sig/datadog/appsec/utils/trace_operation.rbs
deleted file mode 100644
index cd7a86680a1..00000000000
--- a/sig/datadog/appsec/utils/trace_operation.rbs
+++ /dev/null
@@ -1,9 +0,0 @@
-module Datadog
-  module AppSec
-    module Utils
-      class TraceOperation
-        def self.appsec_standalone_reject?: (Datadog::Tracing::TraceOperation trace) -> bool
-      end
-    end
-  end
-end
diff --git a/sig/datadog/tracing/configuration/ext.rbs b/sig/datadog/tracing/configuration/ext.rbs
index 01c18cd981f..80dc1bbe365 100644
--- a/sig/datadog/tracing/configuration/ext.rbs
+++ b/sig/datadog/tracing/configuration/ext.rbs
@@ -5,6 +5,7 @@ module Datadog
         ENV_ENABLED: "DD_TRACE_ENABLED"
 
         ENV_TRACE_ID_128_BIT_GENERATION_ENABLED: "DD_TRACE_128_BIT_TRACEID_GENERATION_ENABLED"
+        ENV_APM_ENABLED: "DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED" # Temporary until RFC decides the final name
         module SpanAttributeSchema
           ENV_GLOBAL_DEFAULT_SERVICE_NAME_ENABLED: "DD_TRACE_REMOVE_INTEGRATION_SERVICE_NAMES_ENABLED"
           ENV_PEER_SERVICE_MAPPING: "DD_TRACE_PEER_SERVICE_MAPPING"
diff --git a/sig/datadog/tracing/contrib/http/circuit_breaker.rbs b/sig/datadog/tracing/contrib/http/circuit_breaker.rbs
index 62ecc351a8a..bc1a05213ff 100644
--- a/sig/datadog/tracing/contrib/http/circuit_breaker.rbs
+++ b/sig/datadog/tracing/contrib/http/circuit_breaker.rbs
@@ -5,8 +5,6 @@ module Datadog
         module CircuitBreaker
           def should_skip_tracing?: (untyped request) -> (true | false)
           def internal_request?: (untyped request) -> bool
-
-          def should_skip_distributed_tracing?: (untyped client_config) -> untyped
         end
       end
     end
diff --git a/sig/datadog/tracing/contrib/httpclient/instrumentation.rbs b/sig/datadog/tracing/contrib/httpclient/instrumentation.rbs
index 44a3a3c40d2..ce0f5210536 100644
--- a/sig/datadog/tracing/contrib/httpclient/instrumentation.rbs
+++ b/sig/datadog/tracing/contrib/httpclient/instrumentation.rbs
@@ -23,8 +23,6 @@ module Datadog
 
             def logger: () -> untyped
 
-            def should_skip_distributed_tracing?: (untyped client_config) -> untyped
-
             def set_analytics_sample_rate: (untyped span, untyped request_options) -> (nil | untyped)
           end
         end
diff --git a/sig/datadog/tracing/contrib/httprb/instrumentation.rbs b/sig/datadog/tracing/contrib/httprb/instrumentation.rbs
index 1fad4e2b94e..16a4ba2133f 100644
--- a/sig/datadog/tracing/contrib/httprb/instrumentation.rbs
+++ b/sig/datadog/tracing/contrib/httprb/instrumentation.rbs
@@ -23,8 +23,6 @@ module Datadog
 
             def logger: () -> untyped
 
-            def should_skip_distributed_tracing?: (untyped client_config) -> untyped
-
             def set_analytics_sample_rate: (untyped span, untyped request_options) -> (nil | untyped)
           end
         end
diff --git a/sig/datadog/tracing/metadata/ext.rbs b/sig/datadog/tracing/metadata/ext.rbs
index 9820be2b123..d347c7abb48 100644
--- a/sig/datadog/tracing/metadata/ext.rbs
+++ b/sig/datadog/tracing/metadata/ext.rbs
@@ -8,6 +8,8 @@ module Datadog
         TAG_PEER_SERVICE: ::String
         TAG_KIND: ::String
         TAG_TOP_LEVEL: ::String
+        TAG_PROFILING_ENABLED: ::String
+        TAG_APM_ENABLED: ::String
 
         module Analytics
           DEFAULT_SAMPLE_RATE: ::Float
diff --git a/sig/datadog/tracing/trace_operation.rbs b/sig/datadog/tracing/trace_operation.rbs
index e434c9872d6..336b5902410 100644
--- a/sig/datadog/tracing/trace_operation.rbs
+++ b/sig/datadog/tracing/trace_operation.rbs
@@ -23,7 +23,7 @@ module Datadog
       attr_writer sampled: untyped
       attr_writer service: untyped
 
-      def initialize: (?agent_sample_rate: untyped?, ?events: untyped?, ?hostname: untyped?, ?id: untyped?, ?max_length: untyped, ?name: untyped?, ?origin: untyped?, ?parent_span_id: untyped?, ?rate_limiter_rate: untyped?, ?resource: untyped?, ?rule_sample_rate: untyped?, ?sample_rate: untyped?, ?sampled: untyped?, ?sampling_priority: untyped?, ?service: untyped?, ?tags: untyped?, ?metrics: untyped?, ?remote_parent: untyped?) -> void
+      def initialize: (?agent_sample_rate: untyped?, ?events: untyped?, ?hostname: untyped?, ?id: untyped?, ?max_length: untyped, ?name: untyped?, ?origin: untyped?, ?parent_span_id: untyped?, ?rate_limiter_rate: untyped?, ?resource: untyped?, ?rule_sample_rate: untyped?, ?sample_rate: untyped?, ?sampled: untyped?, ?sampling_priority: untyped?, ?service: untyped?, ?profiling_enabled: bool?,  ?non_billing_enabled: bool?, ?tags: untyped?, ?metrics: untyped?, ?remote_parent: untyped?) -> void
       def full?: () -> untyped
       def finished_span_count: () -> untyped
       def finished?: () -> untyped
@@ -40,6 +40,7 @@ module Datadog
       def flush!: () { (untyped) -> untyped } -> untyped
       def to_digest: () -> untyped
       def fork_clone: () -> untyped
+      def non_billing_reject?: () -> bool
 
       class Events
         include Tracing::Events
diff --git a/sig/datadog/tracing/trace_segment.rbs b/sig/datadog/tracing/trace_segment.rbs
index 41f81d3114f..8c6702d8bae 100644
--- a/sig/datadog/tracing/trace_segment.rbs
+++ b/sig/datadog/tracing/trace_segment.rbs
@@ -21,8 +21,10 @@ module Datadog
       attr_reader sampling_decision_maker: untyped
       attr_reader sampling_priority: untyped
       attr_reader service: untyped
+      attr_reader profiling_enabled: bool
+      attr_reader non_billing_enabled: bool
 
-      def initialize: (untyped spans, ?agent_sample_rate: untyped?, ?hostname: untyped?, ?id: untyped?, ?lang: untyped?, ?name: untyped?, ?origin: untyped?, ?process_id: untyped?, ?rate_limiter_rate: untyped?, ?resource: untyped?, ?root_span_id: untyped?, ?rule_sample_rate: untyped?, ?runtime_id: untyped?, ?sample_rate: untyped?, ?sampling_priority: untyped?, ?service: untyped?, ?tags: untyped?, ?metrics: untyped?) -> void
+      def initialize: (untyped spans, ?agent_sample_rate: untyped?, ?hostname: untyped?, ?id: untyped?, ?lang: untyped?, ?name: untyped?, ?origin: untyped?, ?process_id: untyped?, ?rate_limiter_rate: untyped?, ?resource: untyped?, ?root_span_id: untyped?, ?rule_sample_rate: untyped?, ?runtime_id: untyped?, ?sample_rate: untyped?, ?sampling_priority: untyped?, ?service: untyped?, ?tags: untyped?, ?metrics: untyped?, ?profiling_enabled: bool?, ?non_billing_enabled: bool?) -> void
       def any?: () -> untyped
       def count: () -> untyped
       def empty?: () -> untyped
diff --git a/sig/datadog/tracing/tracer.rbs b/sig/datadog/tracing/tracer.rbs
index a642e3cb7ab..6755c6200dd 100644
--- a/sig/datadog/tracing/tracer.rbs
+++ b/sig/datadog/tracing/tracer.rbs
@@ -6,6 +6,10 @@ module Datadog
       def active_span: (?untyped? key) -> Datadog::Tracing::Span
 
       def active_correlation: (?untyped? key) -> Struct[untyped] # Datadog::Correlation::Identifier
+                            
+      private
+
+      def non_billing_enabled: () -> bool
     end
   end
 end
diff --git a/sig/datadog/tracing/transport/trace_formatter.rbs b/sig/datadog/tracing/transport/trace_formatter.rbs
index cb8e14c6987..1ea75edf8cb 100644
--- a/sig/datadog/tracing/transport/trace_formatter.rbs
+++ b/sig/datadog/tracing/transport/trace_formatter.rbs
@@ -41,6 +41,10 @@ module Datadog
         def tag_sampling_priority!: () -> (nil | untyped)
 
         def tag_high_order_trace_id!: () -> (nil | untyped)
+                                    
+        def tag_profiling_enabled!: () -> (nil | untyped)
+                                    
+        def tag_non_billing_enabled!: () -> (nil | untyped)
 
         def tag_git_repository_url!: () -> (nil | untyped)
 
diff --git a/spec/datadog/appsec/configuration/settings_spec.rb b/spec/datadog/appsec/configuration/settings_spec.rb
index 3d8115bc3fc..a19a0a94550 100644
--- a/spec/datadog/appsec/configuration/settings_spec.rb
+++ b/spec/datadog/appsec/configuration/settings_spec.rb
@@ -757,45 +757,5 @@ def patcher
         end
       end
     end
-
-    describe 'standalone' do
-      describe '#enabled' do
-        subject(:enabled) { settings.appsec.standalone.enabled }
-
-        context 'when DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED' do
-          around do |example|
-            ClimateControl.modify('DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED' => appsec_standalone_enabled) do
-              example.run
-            end
-          end
-
-          context 'is not defined' do
-            let(:appsec_standalone_enabled) { nil }
-
-            it { is_expected.to eq false }
-          end
-
-          context 'is defined' do
-            let(:appsec_standalone_enabled) { 'true' }
-
-            it { is_expected.to eq(true) }
-          end
-        end
-      end
-
-      describe '#enabled=' do
-        subject(:set_appsec_standalone_enabled) { settings.appsec.standalone.enabled = appsec_standalone_enabled }
-
-        [true, false].each do |value|
-          context "when given #{value}" do
-            let(:appsec_standalone_enabled) { value }
-
-            before { set_appsec_standalone_enabled }
-
-            it { expect(settings.appsec.standalone.enabled).to eq(value) }
-          end
-        end
-      end
-    end
   end
 end
diff --git a/spec/datadog/appsec/contrib/rack/integration_test_spec.rb b/spec/datadog/appsec/contrib/rack/integration_test_spec.rb
index 325541ed0b1..42f32893264 100644
--- a/spec/datadog/appsec/contrib/rack/integration_test_spec.rb
+++ b/spec/datadog/appsec/contrib/rack/integration_test_spec.rb
@@ -46,7 +46,7 @@
   let(:tracing_enabled) { true }
   let(:appsec_enabled) { true }
 
-  let(:appsec_standalone_enabled) { false }
+  let(:tracing_non_billing_enabled) { false }
   let(:remote_enabled) { false }
   let(:appsec_ip_passlist) { [] }
   let(:appsec_ip_denylist) { [] }
@@ -194,7 +194,7 @@
 
         c.appsec.instrument :rack
 
-        c.appsec.standalone.enabled = appsec_standalone_enabled
+        c.tracing.non_billing.enabled = tracing_non_billing_enabled
         c.appsec.waf_timeout = 10_000_000 # in us
         c.appsec.ip_passlist = appsec_ip_passlist
         c.appsec.ip_denylist = appsec_ip_denylist
diff --git a/spec/datadog/appsec/contrib/rails/integration_test_spec.rb b/spec/datadog/appsec/contrib/rails/integration_test_spec.rb
index b564e477c9f..c0d58dff871 100644
--- a/spec/datadog/appsec/contrib/rails/integration_test_spec.rb
+++ b/spec/datadog/appsec/contrib/rails/integration_test_spec.rb
@@ -62,7 +62,7 @@
 
   let(:appsec_instrument_rack) { false }
 
-  let(:appsec_standalone_enabled) { false }
+  let(:tracing_non_billing_enabled) { false }
   let(:appsec_ip_denylist) { [] }
   let(:appsec_user_id_denylist) { [] }
   let(:appsec_ruleset) { :recommended }
@@ -154,7 +154,7 @@
       c.appsec.instrument :rails
       c.appsec.instrument :rack if appsec_instrument_rack
 
-      c.appsec.standalone.enabled = appsec_standalone_enabled
+      c.tracing.non_billing.enabled = tracing_non_billing_enabled
       c.appsec.waf_timeout = 10_000_000 # in us
       c.appsec.ip_denylist = appsec_ip_denylist
       c.appsec.user_id_denylist = appsec_user_id_denylist
diff --git a/spec/datadog/appsec/contrib/sinatra/integration_test_spec.rb b/spec/datadog/appsec/contrib/sinatra/integration_test_spec.rb
index e9f25a12b15..98248e0673e 100644
--- a/spec/datadog/appsec/contrib/sinatra/integration_test_spec.rb
+++ b/spec/datadog/appsec/contrib/sinatra/integration_test_spec.rb
@@ -72,7 +72,7 @@
   let(:tracing_enabled) { true }
   let(:appsec_enabled) { true }
 
-  let(:appsec_standalone_enabled) { false }
+  let(:tracing_non_billing_enabled) { false }
   let(:appsec_ip_denylist) { [] }
   let(:appsec_user_id_denylist) { [] }
   let(:appsec_ruleset) { :recommended }
@@ -161,7 +161,7 @@
       c.appsec.instrument :sinatra
       # TODO: test with c.appsec.instrument :rack
 
-      c.appsec.standalone.enabled = appsec_standalone_enabled
+      c.tracing.non_billing.enabled = tracing_non_billing_enabled
       c.appsec.waf_timeout = 10_000_000 # in us
       c.appsec.ip_denylist = appsec_ip_denylist
       c.appsec.user_id_denylist = appsec_user_id_denylist
diff --git a/spec/datadog/appsec/contrib/support/integration/shared_examples.rb b/spec/datadog/appsec/contrib/support/integration/shared_examples.rb
index bcf82aaa8aa..43470856d81 100644
--- a/spec/datadog/appsec/contrib/support/integration/shared_examples.rb
+++ b/spec/datadog/appsec/contrib/support/integration/shared_examples.rb
@@ -220,7 +220,7 @@
 RSpec.shared_examples 'appsec standalone billing' do
   subject(:response) { get url, params, env }
 
-  let(:appsec_standalone_enabled) { true }
+  let(:tracing_non_billing_enabled) { true }
 
   let(:url) { '/requestdownstream' }
   let(:params) { {} }
diff --git a/spec/datadog/appsec/utils/trace_operation_spec.rb b/spec/datadog/appsec/utils/trace_operation_spec.rb
deleted file mode 100644
index 15692054506..00000000000
--- a/spec/datadog/appsec/utils/trace_operation_spec.rb
+++ /dev/null
@@ -1,40 +0,0 @@
-require 'datadog/appsec/spec_helper'
-require 'datadog/appsec/utils/trace_operation'
-
-RSpec.describe Datadog::AppSec::Utils::TraceOperation do
-  describe '#appsec_standalone_reject?' do
-    subject(:appsec_standalone_reject?) do
-      described_class.appsec_standalone_reject?(trace_op)
-    end
-
-    let(:trace_op) { Datadog::Tracing::TraceOperation.new(**options) }
-    let(:options) { {} }
-    let(:appsec_standalone) { false }
-    let(:distributed_appsec_event) { '0' }
-
-    before do
-      allow(Datadog.configuration.appsec.standalone).to receive(:enabled).and_return(appsec_standalone)
-      trace_op.set_tag(Datadog::AppSec::Ext::TAG_DISTRIBUTED_APPSEC_EVENT, distributed_appsec_event) if trace_op
-    end
-
-    it { is_expected.to be false }
-
-    context 'when AppSec standalone is enabled' do
-      let(:appsec_standalone) { true }
-
-      it { is_expected.to be true }
-
-      context 'without a trace' do
-        let(:trace_op) { nil }
-
-        it { is_expected.to be true }
-      end
-
-      context 'with a distributed AppSec event' do
-        let(:distributed_appsec_event) { '1' }
-
-        it { is_expected.to be false }
-      end
-    end
-  end
-end
diff --git a/spec/datadog/core/remote/transport/http_spec.rb b/spec/datadog/core/remote/transport/http_spec.rb
index 077d0cc6d98..4dd2957420b 100644
--- a/spec/datadog/core/remote/transport/http_spec.rb
+++ b/spec/datadog/core/remote/transport/http_spec.rb
@@ -75,7 +75,7 @@
       it { expect(transport.client.api.headers).to_not include('Datadog-Client-Computed-Stats') }
 
       context 'with ASM standalone enabled' do
-        before { expect(Datadog.configuration.appsec.standalone).to receive(:enabled).and_return(true) }
+        before { expect(Datadog.configuration.tracing.non_billing).to receive(:enabled).and_return(true) }
 
         it { expect(transport.client.api.headers['Datadog-Client-Computed-Stats']).to eq('yes') }
       end
@@ -213,8 +213,8 @@
 
       it { expect(transport.client.api.headers).to_not include('Datadog-Client-Computed-Stats') }
 
-      context 'with ASM standalone enabled' do
-        before { expect(Datadog.configuration.appsec.standalone).to receive(:enabled).and_return(true) }
+      context 'with non-billing mode enabled' do
+        before { expect(Datadog.configuration.tracing.non_billing).to receive(:enabled).and_return(true) }
 
         it { expect(transport.client.api.headers['Datadog-Client-Computed-Stats']).to eq('yes') }
       end
diff --git a/spec/datadog/tracing/configuration/settings_spec.rb b/spec/datadog/tracing/configuration/settings_spec.rb
index ff94d55e670..545374ada52 100644
--- a/spec/datadog/tracing/configuration/settings_spec.rb
+++ b/spec/datadog/tracing/configuration/settings_spec.rb
@@ -351,6 +351,49 @@ def propagation_style_inject
       end
     end
 
+    describe 'non_billing' do
+      describe '#enabled' do
+        subject(:enabled) { settings.tracing.non_billing.enabled }
+
+        it { is_expected.to be false }
+
+        context 'when DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED' do
+          around do |example|
+            ClimateControl.modify('DD_EXPERIMENTAL_APPSEC_STANDALONE_ENABLED' => appsec_standalone_enabled) do
+              example.run
+            end
+          end
+
+          context 'is not defined' do
+            let(:appsec_standalone_enabled) { nil }
+
+            it { is_expected.to eq false }
+          end
+
+          context 'is set to true' do
+            let(:appsec_standalone_enabled) { 'true' }
+
+            it { is_expected.to be true }
+          end
+
+          context 'is set to false' do
+            let(:appsec_standalone_enabled) { 'false' }
+
+            it { is_expected.to be false }
+          end
+        end
+      end
+
+      describe '#enabled=' do
+        it 'updates the #enabled setting' do
+          expect { settings.tracing.non_billing.enabled = true }
+            .to change { settings.tracing.non_billing.enabled }
+            .from(false)
+            .to(true)
+        end
+      end
+    end
+
     describe '#header_tags' do
       subject(:header_tags) { settings.tracing.header_tags }
 
diff --git a/spec/datadog/tracing/contrib/ethon/easy_patch_spec.rb b/spec/datadog/tracing/contrib/ethon/easy_patch_spec.rb
index f1ad802e935..07f00873871 100644
--- a/spec/datadog/tracing/contrib/ethon/easy_patch_spec.rb
+++ b/spec/datadog/tracing/contrib/ethon/easy_patch_spec.rb
@@ -115,6 +115,17 @@
     it_behaves_like 'environment service name', 'DD_TRACE_ETHON_SERVICE_NAME' do
       let(:span) { span_op }
     end
+
+    context 'with non-billing mode' do
+      before do
+        allow_any_instance_of(Datadog::Tracing::TraceOperation).to receive(:non_billing_reject?).and_return(true)
+      end
+
+      it do
+        subject
+        expect(Datadog::Tracing.active_trace.sampling_priority).to eq(0)
+      end
+    end
   end
 
   describe '#complete' do
diff --git a/spec/datadog/tracing/contrib/excon/instrumentation_spec.rb b/spec/datadog/tracing/contrib/excon/instrumentation_spec.rb
index 411abc43d8e..5d1374791e3 100644
--- a/spec/datadog/tracing/contrib/excon/instrumentation_spec.rb
+++ b/spec/datadog/tracing/contrib/excon/instrumentation_spec.rb
@@ -364,6 +364,31 @@
     end
   end
 
+  context 'with non-billing mode' do
+    subject!(:response) do
+      expect_any_instance_of(described_class).to receive(:request_call)
+        .and_wrap_original do |m, *args|
+          allow_any_instance_of(Datadog::Tracing::TraceOperation).to receive(:non_billing_reject?).and_return(true)
+          m.call(*args).tap do |datum|
+            # Assert request headers
+            span = datum[:datadog_span]
+            headers = datum[:headers]
+            expect(headers).to include(
+              'x-datadog-trace-id' => low_order_trace_id(span.trace_id).to_s,
+              'x-datadog-parent-id' => span.id.to_s,
+              'x-datadog-sampling-priority' => '0'
+            )
+          end
+        end
+
+      connection.get(path: '/success')
+    end
+
+    it do
+      subject
+    end
+  end
+
   context 'global service name' do
     subject(:get) { connection.get(path: '/success') }
 
diff --git a/spec/datadog/tracing/contrib/faraday/middleware_spec.rb b/spec/datadog/tracing/contrib/faraday/middleware_spec.rb
index 808d4e8cd82..8c27b0fb3b7 100644
--- a/spec/datadog/tracing/contrib/faraday/middleware_spec.rb
+++ b/spec/datadog/tracing/contrib/faraday/middleware_spec.rb
@@ -410,6 +410,25 @@
     end
   end
 
+  context 'when non-billing mode is enabled' do
+    subject(:response) { client.get('/success') }
+
+    before do
+      Datadog.configure do |c|
+        c.tracing.non_billing.enabled = true
+      end
+      # This cannot happen in actual apps but we do this to
+      # verify that sampling priority is set to 0 through distributed tracing without mocking an agent
+      allow(Datadog::Tracing::Distributed::Helpers).to receive(:should_skip_distributed_tracing?).and_return(false)
+    end
+
+    let(:headers) { response.env.request_headers }
+
+    it do
+      expect(headers).to include('x-datadog-sampling-priority' => '0')
+    end
+  end
+
   context 'global service name' do
     let(:service_name) { 'faraday-global' }
 
diff --git a/spec/datadog/tracing/contrib/grpc/datadog_interceptor/client_spec.rb b/spec/datadog/tracing/contrib/grpc/datadog_interceptor/client_spec.rb
index de8b3926be3..aa69f4b07fe 100644
--- a/spec/datadog/tracing/contrib/grpc/datadog_interceptor/client_spec.rb
+++ b/spec/datadog/tracing/contrib/grpc/datadog_interceptor/client_spec.rb
@@ -17,10 +17,19 @@
   let(:peer) { "#{host}:#{port}" }
   let(:host) { 'host.name' }
   let(:port) { 0 }
+  let(:tracing_non_billing_enabled) { false }
+  let(:force_execute_distributed_tracing) { false }
 
   before do
     Datadog.configure do |c|
       c.tracing.instrument :grpc, configuration_options
+      c.tracing.non_billing.enabled = tracing_non_billing_enabled
+    end
+
+    if force_execute_distributed_tracing
+      # This cannot happen in actual apps but we do this to
+      # verify that sampling priority is set to 0 through distributed tracing without mocking an agent
+      allow(Datadog::Tracing::Distributed::Helpers).to receive(:should_skip_distributed_tracing?).and_return(false)
     end
   end
 
@@ -117,6 +126,20 @@
       it 'injects distribution data in gRPC metadata' do
         expect(keywords[:metadata].keys).to include('x-datadog-trace-id', 'x-datadog-parent-id', 'x-datadog-tags')
       end
+
+      context 'with non-billing mode' do
+        # We cannot get the trace as it is sent and flushed.
+        # But we can verify non-billing mode through distributed tracing
+
+        # Not sure why, putting a before block here has no effect
+        let(:tracing_non_billing_enabled) { true }
+        let(:force_execute_distributed_tracing) { true }
+
+        it {
+          expect(keywords[:metadata].keys).to include('x-datadog-sampling-priority')
+          expect(keywords[:metadata]['x-datadog-sampling-priority']).to eq('0')
+        }
+      end
     end
   end
 
diff --git a/spec/datadog/tracing/contrib/http/circuit_breaker_spec.rb b/spec/datadog/tracing/contrib/http/circuit_breaker_spec.rb
index 851ccddb86d..4d656c7ed87 100644
--- a/spec/datadog/tracing/contrib/http/circuit_breaker_spec.rb
+++ b/spec/datadog/tracing/contrib/http/circuit_breaker_spec.rb
@@ -91,68 +91,4 @@
       end
     end
   end
-
-  describe '#should_skip_distributed_tracing?' do
-    subject(:should_skip_distributed_tracing?) { circuit_breaker.should_skip_distributed_tracing?(client_config) }
-
-    let(:client_config) { nil }
-    let(:distributed_tracing) { true }
-    let(:appsec_standalone) { false }
-    let(:active_trace) { nil }
-    let(:distributed_appsec_event) { nil }
-
-    before do
-      allow(Datadog.configuration.tracing[:http]).to receive(:[]).with(:distributed_tracing).and_return(distributed_tracing)
-      allow(Datadog.configuration.appsec.standalone).to receive(:enabled).and_return(appsec_standalone)
-      allow(Datadog::Tracing).to receive(:active_trace).and_return(active_trace)
-      allow(active_trace).to receive(:get_tag).with('_dd.p.appsec').and_return(distributed_appsec_event) if active_trace
-    end
-
-    context 'when distributed tracing is enabled' do
-      it { is_expected.to be false }
-    end
-
-    context 'when distributed tracing is disabled' do
-      let(:distributed_tracing) { false }
-
-      it { is_expected.to be true }
-    end
-
-    context 'when appsec standalone is enabled' do
-      let(:appsec_standalone) { true }
-
-      context 'when there is no active trace' do
-        it { is_expected.to be true }
-      end
-
-      context 'when there is an active trace' do
-        let(:active_trace) { instance_double(Datadog::Tracing::TraceOperation) }
-
-        context 'when the active trace has no distributed appsec event' do
-          it { is_expected.to be true }
-        end
-
-        context 'when the active trace has a distributed appsec event' do
-          # This should act like standalone appsec is disabled, as it does not return in the
-          # `if Datadog.configuration.appsec.standalone.enabled` block
-          # so we're only testing the "no client config, distributed tracing enabled" case here
-          let(:distributed_appsec_event) { '1' }
-
-          it { is_expected.to be false }
-        end
-      end
-    end
-
-    context 'given a client config with distributed_tracing disabled' do
-      let(:client_config) { { distributed_tracing: false } }
-
-      it { is_expected.to be true }
-    end
-
-    context 'given a client config with distributed_tracing enabled' do
-      let(:client_config) { { distributed_tracing: true } }
-
-      it { is_expected.to be false }
-    end
-  end
 end
diff --git a/spec/datadog/tracing/contrib/httpclient/instrumentation_spec.rb b/spec/datadog/tracing/contrib/httpclient/instrumentation_spec.rb
index 4405748fbac..fa1baa821ce 100644
--- a/spec/datadog/tracing/contrib/httpclient/instrumentation_spec.rb
+++ b/spec/datadog/tracing/contrib/httpclient/instrumentation_spec.rb
@@ -233,6 +233,21 @@
           it 'propogrates the trace id header' do
             expect(http_response.headers['X-Datadog-Trace-Id']).to eq(low_order_trace_id(span.trace_id).to_s)
           end
+
+          context 'with non-billing mode' do
+            before do
+              Datadog.configure do |c|
+                c.tracing.non_billing.enabled = true
+              end
+              # This cannot happen in actual apps but we do this to
+              # verify that sampling priority is set to 0 through distributed tracing without mocking an agent
+              allow(Datadog::Tracing::Distributed::Helpers).to receive(:should_skip_distributed_tracing?).and_return(false)
+            end
+
+            it 'propagates sampling priority with value 0' do
+              expect(response.headers['X-Datadog-Sampling-Priority']).to eq('0')
+            end
+          end
         end
 
         context 'distributed tracing disabled' do
diff --git a/spec/datadog/tracing/contrib/httprb/instrumentation_spec.rb b/spec/datadog/tracing/contrib/httprb/instrumentation_spec.rb
index 485c599fa53..dec406de442 100644
--- a/spec/datadog/tracing/contrib/httprb/instrumentation_spec.rb
+++ b/spec/datadog/tracing/contrib/httprb/instrumentation_spec.rb
@@ -236,6 +236,21 @@
           it 'propagates the trace id header' do
             expect(http_response.headers['x-datadog-trace-id']).to eq(low_order_trace_id(span.trace_id).to_s)
           end
+
+          context 'with non-billing mode' do
+            before do
+              Datadog.configure do |c|
+                c.tracing.non_billing.enabled = true
+              end
+              # This cannot happen in actual apps but we do this to
+              # verify that sampling priority is set to 0 without mocking an agent
+              allow(Datadog::Tracing::Distributed::Helpers).to receive(:should_skip_distributed_tracing?).and_return(false)
+            end
+
+            it 'propagates sampling priority with value 0' do
+              expect(response.headers['X-Datadog-Sampling-Priority']).to eq('0')
+            end
+          end
         end
 
         context 'distributed tracing disabled' do
diff --git a/spec/datadog/tracing/contrib/rest_client/request_patch_spec.rb b/spec/datadog/tracing/contrib/rest_client/request_patch_spec.rb
index 889363cf201..e5f59ff812e 100644
--- a/spec/datadog/tracing/contrib/rest_client/request_patch_spec.rb
+++ b/spec/datadog/tracing/contrib/rest_client/request_patch_spec.rb
@@ -328,6 +328,22 @@
             .to have_been_made
         end
       end
+
+      context 'with non-billing mode' do
+        before do
+          Datadog.configure do |c|
+            c.tracing.non_billing.enabled = true
+          end
+          # This cannot happen in actual apps but we do this to
+          # verify that sampling priority is set to 0 through distributed tracing without mocking an agent
+          allow(Datadog::Tracing::Distributed::Helpers).to receive(:should_skip_distributed_tracing?).and_return(false)
+        end
+
+        it 'propagates sampling priority with value 0' do
+          request
+          expect(a_request(:get, url).with(headers: { 'X-Datadog-Sampling-Priority' => '0' })).to have_been_made
+        end
+      end
     end
 
     context 'distributed tracing disabled' do
diff --git a/spec/datadog/tracing/contrib/sidekiq/distributed_tracing_spec.rb b/spec/datadog/tracing/contrib/sidekiq/distributed_tracing_spec.rb
index 15d7575585b..28f43d085eb 100644
--- a/spec/datadog/tracing/contrib/sidekiq/distributed_tracing_spec.rb
+++ b/spec/datadog/tracing/contrib/sidekiq/distributed_tracing_spec.rb
@@ -63,6 +63,25 @@ def perform; end
         expect(job['x-datadog-tags']).to eq("_dd.p.dm=-0,_dd.p.tid=#{high_order_hex_trace_id(span.trace_id)}")
         expect(job).not_to include 'x-datadog-origin'
       end
+
+      context 'with non-billing mode' do
+        before do
+          Datadog.configure do |c|
+            c.tracing.non_billing.enabled = true
+          end
+          # This cannot happen in actual apps but we do this to
+          # verify that sampling priority is set to 0 through distributed tracing without mocking an agent
+          allow(Datadog::Tracing::Distributed::Helpers).to receive(:should_skip_distributed_tracing?).and_return(false)
+        end
+
+        it 'propagates sampling priority with value 0' do
+          EmptyWorker.perform_async
+
+          job = EmptyWorker.jobs.first
+
+          expect(job['x-datadog-sampling-priority']).to eq('0')
+        end
+      end
     end
 
     context 'when receiving' do
diff --git a/spec/datadog/tracing/trace_operation_spec.rb b/spec/datadog/tracing/trace_operation_spec.rb
index d168a99f73c..a5d3244e120 100644
--- a/spec/datadog/tracing/trace_operation_spec.rb
+++ b/spec/datadog/tracing/trace_operation_spec.rb
@@ -2579,6 +2579,35 @@ def span
     end
   end
 
+  describe '#non_billing_reject?' do
+    subject(:non_billing_reject?) do
+      trace_op.non_billing_reject?
+    end
+
+    let(:trace_op) { described_class.new(**options) }
+    let(:options) { { non_billing_enabled: non_billing_enabled } }
+    let(:non_billing_enabled) { false }
+    let(:distributed_appsec_event) { '0' }
+
+    before do
+      trace_op.set_tag(Datadog::AppSec::Ext::TAG_DISTRIBUTED_APPSEC_EVENT, distributed_appsec_event)
+    end
+
+    it { is_expected.to be false }
+
+    context 'when non-billing is enabled' do
+      let(:non_billing_enabled) { true }
+
+      it { is_expected.to be true }
+
+      context 'with a distributed AppSec event' do
+        let(:distributed_appsec_event) { '1' }
+
+        it { is_expected.to be false }
+      end
+    end
+  end
+
   describe 'integration tests' do
     context 'service_entry attributes' do
       context 'when service not given' do
diff --git a/spec/datadog/tracing/transport/http_spec.rb b/spec/datadog/tracing/transport/http_spec.rb
index f7af5db609c..20803a23978 100644
--- a/spec/datadog/tracing/transport/http_spec.rb
+++ b/spec/datadog/tracing/transport/http_spec.rb
@@ -181,17 +181,19 @@
       end
     end
 
-    context 'when Datadog.configuration.appsec.standalone.enabled' do
-      before { expect(Datadog.configuration.appsec.standalone).to receive(:enabled).and_return(asm_standalone_enabled) }
+    context 'when Datadog.configuration.tracing.non_billing.enabled' do
+      before do
+        expect(Datadog.configuration.tracing.non_billing).to receive(:enabled).and_return(tracing_non_billing_enabled)
+      end
 
       context 'is true' do
-        let(:asm_standalone_enabled) { true }
+        let(:tracing_non_billing_enabled) { true }
 
         it { is_expected.to include(Datadog::Core::Transport::Ext::HTTP::HEADER_CLIENT_COMPUTED_STATS => 'yes') }
       end
 
       context 'is false' do
-        let(:asm_standalone_enabled) { false }
+        let(:tracing_non_billing_enabled) { false }
 
         it { is_expected.to_not include(Datadog::Core::Transport::Ext::HTTP::HEADER_CLIENT_COMPUTED_STATS) }
       end