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FAR and DFARS › FAR Part 27: Patents, Data, and Copyrights › Subpart 27.2

FAR 27.202-2 Notice of Government as a licensee.

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 section tells contracting officers to notify prospective offerors when the Government must pay a patent royalty under an existing license and that patent may apply to a coming contract. It also requires solicitations to ask offerors whether they own or license that patent, so the Government can adjust prices or negotiate a lower rate. It matters because it affects how your price may be evaluated or negotiated if a licensed patent is involved.

Applies to: Contracting officers and offerors on solicitations involving a Government-paid patent royalty

What it requires

  • Furnish prospective offerors notice of the license, the patent number, and the royalty rate cited in the license
  • Require offerors to state whether each is the patent owner or a licensee under the patent

Key terms: royalty · existing license agreement · licensed patent · prospective contract · royalty rate

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

The text

(a) When the Government is obligated to pay a royalty on a patent because of an existing license agreement and the contracting officer believes that the licensed patent will be applicable to a prospective contract, the Government should furnish the prospective offerors with—

(1) Notice of the license;

(2) The number of the patent; and

(3) The royalty rate cited in the license.

(b) When the Government is obligated to pay such a royalty, the solicitation should also require offerors to furnish information indicating whether or not each offeror is the patent owner or a licensee under the patent. This information is necessary so that the Government may either—

(1) Evaluate an offeror's price by adding an amount equal to the royalty; or

(2) Negotiate a price reduction with an offeror when the offeror is licensed under the same patent at a lower royalty rate.

← 27.202-1 Reporting of royalties. · 27.202-3 Adjustment of royalties. →

Rule changes for FAR Part 27

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

FAR 27.202-2 Notice of Government as a licensee · SpendQuery