[Code of Federal Regulations]

[Title 48, Volume 1]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR27.206-1]



[Page 513]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

                CHAPTER 1--FEDERAL ACQUISITION REGULATION

 

PART 27_PATENTS, DATA, AND COPYRIGHTS--Table of Contents

 

                          Subpart 27.2_Patents

 

Sec. 27.206-1  General.



    When a fixed-price contract is negotiated under circumstances that 

make it questionable whether or not substantial amounts of royalties 

will have to be paid by the contractor or a subcontractor, such 

royalties may be included in the target or contract price, provided the 

contract specifies that the Government will be reimbursed the amount of 

such royalties if they are not paid. Such circumstances might include, 

for example, either a pending Government anti-trust action or 

prospective litigation on the validity of a patent or patents or on the 

enforceability of an agreement (upon which the contractor or 

subcontractor bases the asserted obligation) to pay the royalties to be 

included in the target or contract price.