27.201-2 Contract clauses
Source: FAR 27.201-2 on acquisition.gov
Contracting officers must carefully select and insert the correct patent and copyright infringement clauses and alternates based on contract type, performance location, and acquisition procedures to ensure compliance and manage liability.
Overview
FAR 27.201-2 details the required and optional use of specific contract clauses related to patent and copyright infringement in government contracts. It provides clear instructions for contracting officers on when to include clauses such as Authorization and Consent, Patent Indemnity, and Notice and Assistance Regarding Patent and Copyright Infringement, as well as their alternates, based on contract type, purpose, and location of performance. The section also addresses exceptions, such as contracts performed entirely outside the U.S., and prohibits the government from indemnifying contractors for patent infringement.
Key Rules
- Authorization and Consent (52.227-1)
- Required in most contracts, optional for simplified acquisitions, and prohibited for contracts performed and delivered entirely outside the U.S.
- Alternates for Authorization and Consent
- Alternate I for R&D contracts (except construction/architect-engineer unless exclusively R&D); Alternate II for unregulated communication services.
- Notice and Assistance (52.227-2)
- Required whenever Authorization and Consent is included.
- Patent Indemnity (52.227-3)
- Required for commercial products/services unless certain exceptions apply (e.g., Part 12/13 procedures, outside U.S., or commercial practice).
- Alternates for Patent Indemnity
- Alternate I/II for mixed contracts or limited applicability; Alternate III for certain communication services.
- Patent Indemnity for Construction (52.227-4)
- Required for construction/demolition contracts, with possible exclusions for nonstandard items.
- Waiver of Indemnity (52.227-5)
- May be used to exempt specific patents with agency head approval.
- No Government Indemnification
- The government cannot agree to indemnify contractors for patent infringement.
Responsibilities
- Contracting Officers: Must select and insert appropriate clauses and alternates based on contract type, value, and performance location; consult legal counsel as needed; obtain agency head approval for waivers.
- Contractors: Must comply with the included clauses, provide required notices, and understand indemnity limitations.
- Agencies: Agency heads may approve waivers for specific patents; oversee compliance with clause requirements.
Practical Implications
- Ensures contractors and the government are clear on liability and procedures for patent and copyright infringement.
- Reduces government risk by prohibiting indemnification of contractors.
- Common pitfalls include incorrect clause selection or omission, especially for contracts outside the U.S. or using simplified/commercial procedures.
(a)
(1) Insert the clause at 52.227-1, Authorization and Consent, in solicitations and contracts except that use of the clause is-
(i) Optional when using simplified acquisition procedures; and
(ii) Prohibited when both complete performance and delivery are outside the United States.
(2) Use the clause with its Alternate I in all R&D solicitations and contracts for which the primary purpose is R&D work, except that this alternate shall not be used in construction and architect-engineer contracts unless the contract calls exclusively for R&D work.
(3) Use the clause with its Alternate II in solicitations and contracts for communication services with a common carrier and the services are unregulated and not priced by a tariff schedule set by a regulatory body.
(b) Insert the clause at 52.227-2, Notice and Assistance Regarding Patent and Copyright Infringement, in all solicitations and contracts that include the clause at 52.227-1, Authorization and Consent.
(c)
(1) Insert the clause at 52.227-3, Patent Indemnity, in solicitations and contracts that may result in the delivery of commercial products or the provision of commercial services unless-
(i) part 12 procedures are used;
(ii) The simplified acquisition procedures of part 13 are used;
(iii) Both complete performance and delivery are outside the United States; or
(iv) The contracting officer determines after consultation with legal counsel that omission of the clause would be consistent with commercial practice.
(2) Use the clause with either its Alternate I (identification of excluded items) or II (identification of included items) if-
(i) The contract also requires delivery of items that are not commercial products or the provision of services that are not commercial services; or
(ii) The contracting officer determines after consultation with legal counsel that limitation of applicability of the clause would be consistent with commercial practice.
(3) Use the clause with its Alternate III if the solicitation or contract is for communication services and facilities where performance is by a common carrier, and the services are unregulated and are not priced by a tariff schedule set by a regulatory body.
(d)
(1) Insert the clause at 52.227-4, Patent Indemnity-Construction Contracts, in solicitations and contracts for construction or that are fixed-price for dismantling, demolition, or removal of improvements. Do not insert the clause in contracts solely for architect-engineer services.
(2) If the contracting officer determines that the construction will necessarily involve the use of structures, products, materials, equipment, processes, or methods that are nonstandard, noncommercial, or special, the contracting officer may expressly exclude them from the patent indemnification by using the clause with its Alternate I. Note that this exclusion is for items, as distinguished from identified patents (see paragraph (e) of this subsection).
(e) It may be in the Government’s interest to exempt specific U.S. patents from the patent indemnity clause. Exclusion from indemnity of identified patents, as distinguished from items, is the prerogative of the agency head. Upon written approval of the agency head, the contracting officer may insert the clause at 52.227-5, Waiver of Indemnity, in solicitations and contracts in addition to the appropriate patent indemnity clause.
(f) If a patent indemnity clause is not prescribed, the contracting officer may include one in the solicitation and contract if it is in the Government’s interest to do so.
(g) The contracting officer shall not include in any solicitation or contract any clause whereby the Government agrees to indemnify a contractor for patent infringement.