52.227-6 Royalty Information
Source: FAR 52.227-6 on acquisition.gov
Offerors must disclose detailed royalty information for any proposal with total royalties or license fees exceeding $250, and provide supporting documentation if requested by the Contracting Officer.
Overview
FAR 52.227-6, Royalty Information, requires offerors to disclose detailed information about royalties or license fees included in their proposal responses when the total exceeds $250. This provision ensures transparency regarding intellectual property costs that may impact contract pricing. Offerors must provide specifics for each royalty or license fee, including licensor details, agreement dates, patent information, item descriptions, royalty rates, unit prices, quantities, and total royalty amounts. If requested by the Contracting Officer, offerors must also supply copies of current license agreements and identify relevant patent claims. Alternate I modifies the requirement for solicitations involving special construction or assembly, but maintains the same disclosure threshold and information requirements. This provision helps agencies assess the reasonableness and allowability of royalty costs in contract pricing.
Key Rules
- Disclosure Threshold
- Offerors must provide royalty information if total royalties or license fees in the proposal exceed $250.
- Required Royalty Details
- For each royalty or license fee, offerors must disclose licensor name/address, license date, patent or basis, item description, royalty rate, unit price, number of units, and total royalty amount.
- License Agreement Submission
- If requested by the Contracting Officer, offerors must submit copies of current license agreements and identify applicable patent claims.
- Alternate I for Special Construction/Assembly
- For solicitations involving special construction or assembly, the same requirements apply if royalties exceed $250.
Responsibilities
- Contracting Officers: Must request and review royalty information and may request license agreements for verification.
- Contractors/Offerors: Must accurately disclose all required royalty information and provide supporting documentation if requested.
- Agencies: Ensure compliance and evaluate reasonableness of royalty costs in proposals.
Practical Implications
- This provision ensures transparency in royalty costs, helping prevent unallowable or excessive charges in government contracts.
- Contractors must maintain thorough records of royalty agreements and be prepared to provide detailed breakdowns and documentation.
- Failure to comply can delay contract award or result in disqualification.
As prescribed in 27.202-5(a)(1), insert the following provision:
Royalty Information (Apr 1984)
(a) Cost or charges for royalties. When the response to this solicitation contains costs or charges for royalties totaling more than $250, the following information shall be included in the response relating to each separate item of royalty or license fee:
(1) Name and address of licensor.
(2) Date of license agreement.
(3) Patent numbers, patent application serial numbers, or other basis on which the royalty is payable.
(4) Brief description, including any part or model numbers of each contract item or component on which the royalty is payable.
(5) Percentage or dollar rate of royalty per unit.
(6) Unit price of contract item.
(7) Number of units.
(8) Total dollar amount of royalties.
(b) Copies of current licenses. In addition, if specifically requested by the Contracting Officer before execution of the contract, the offeror shall furnish a copy of the current license agreement and an identification of applicable claims of specific patents.
(End of Provision)
Alternate I (Apr 1984). As prescribed in 27.202-5 (a)(2), substitute the following for the introductory portion of paragraph (a) of the basic provision:
When the response to this solicitation covers charges for special construction or special assembly that contain costs or charges for royalties totaling more than $250, the following information shall be included in the response relating to each separate item of royalty or license fee: