SpendQueryBeta

FAR and DFARS › DFARS Part 252: Solicitation Provisions and Contract Clauses › Subpart 252.2

DFARS 252.227-7009 Reporting and payment of royalties.

The codified text (eCFR, as of 2026-10-02). Under the Revolutionary FAR Overhaul ↗, agencies follow class deviations with new text for many parts while the formal rules go through the Federal Register: check the solicitation and your contract's clauses, which rule.

In plain English

This clause sets up how royalty payments under a patent license, release, or assignment are reported and paid. The designated office must send the contractor a written royalty report within 60 days after each reporting period, and the contractor is paid within 60 days after submitting a voucher, subject to a stated maximum yearly obligation. It matters because it defines the timing and limits of royalty payments a contractor can expect.

Applies to: Patent releases, license agreements, and assignments containing this clause

What it requires

  • The designated office must deliver a written royalty report to the contractor within 60 days after each reporting period in which royalties accrued
  • Royalties that accrued must be paid to the contractor within 60 days after receipt of the contractor's voucher, if appropriations are available
  • If combined royalties exceed the stated maximum yearly obligation, each department or agency pays a pro rata share based on its proportion of accrued royalties

Key terms: royalties · yearly period · voucher · maximum yearly obligation · pro rata share

Written by AI from this section's text. A guide, not legal advice: the text below rules.

The text

As prescribed at 227.7009-4(d), insert the following clause in patent releases, license agreements, and assignments:

Reporting and Payment of Royalties (SEP 2019)

(a) The [insert the Contracting Officer or the name of the designated office, in accordance with agency procedures] shall, on or before the sixtieth (60th) day next following the end of each yearly* period ending ____________ during which royalties have accrued under this license, deliver to the Contractor, subject to military security regulations, a report in writing furnishing necessary information relative to royalties which have accrued under this contract.

* The frequency, date, and length of reporting periods should be selected as appropriate to the particular circumstances of the contract.

(b) Royalties which have accrued under this contract during the yearly* period ending ____________ shall be paid to the Contractor (if appropriations therefor are available or become available) within sixty (60) days next following the receipt of a voucher from the Contractor submitted in accordance with the report referred to in (a) of this clause; Provided, that the Government shall not be obligated to pay, in respect of any such yearly period, on account of the combined royalties accruing under this contract directly and under any separate licenses granted pursuant to the “License to Other Government Agencies” clause (if any) of this contract, an amount greater than ____________ dollars ($____________), and if such combined royalties exceed the said maximum yearly obligation, each department or agency shall pay a pro rata share of the said maximum yearly obligation as determined by the proportion its accrued royalties bear to the combined total of accrued royalties.

(End of clause)

Sections it refers to

  • 227.7009-4 Additional clauses—contracts providing for payment of a running royalty.

Sections that refer to it

  • 227.7009-4 Additional clauses—contracts providing for payment of a running royalty.
  • 252.227-7012 Patent License and Release Contract.

← 252.227-7008 Computation of royalties. · 252.227-7010 License to other Government agencies. →

Rule changes for DFARS Part 252

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.

DFARS 252.227-7009 Reporting and payment of royalties · SpendQuery