FAR and Beyond Blog

The $50 billion GSA MAS program is where federal requirements and commercial practices intersect creating a highly competitive governmentwide commercial marketplace. As the federal government’s largest commercial item contracting program, it is imperative that MAS contracts efficiently and effectively reconcile government requirements and commercial practices. With thousands of contracts covering millions of items, the ability of GSA and MAS contractors to work together to ensure clear, flexible and sound contract terms is vital to the success of the program in delivering best value to customer agencies and the taxpayer. Moreover, maintaining balance between government requirements and commercial practices in MAS contract terms enhances access to the commercial marketplace and fosters efficient and effective competition.

MAS contracts are living documents. Over time government requirements and commercial practices can and do change. A recent example of this is the ongoing dialogue between GSA and the IT schedule contractors regarding software license terms and conditions. GSA has identified certain commercial license terms that GSA believes are inconsistent with certain government requirements. With hundreds, if not thousands of potential software license agreements under the MAS contracts, GSA and IT schedule contractors should work together to find an efficient and effective process for addressing these concerns.

For those IT schedule contracts where the software licensing issues have not been resolved there may be a balanced, phased solution that allows the IT schedule contractors to continue competing for MAS orders while the issue is being addressed. Perhaps a first step would be to explore the possibility of bilaterally modifying IT schedule contracts to include an overarching conflicts statement addressing government laws or regulations and the standard commercial software license terms. Here is some sample language for the contracts:

The parties acknowledge and agree that this Contract and any orders hereunder are subject to certain federal laws and regulations. Notwithstanding any clause to the contrary in any license agreement attached or appended to any order under this Contract, to the extent any clauses in the attached license agreement conflict with federal law or regulation or the terms of this Contract, such clauses shall not be given effect. The parties agree to review and negotiate the license clauses in good faith to the extent necessary to ensure compliance with applicable law and regulation.

In addition, the IT schedule contracts already include FAR Clause 52.216-18 Ordering (OCT 1995) (Deviation II—FEB 2007) which provides in part that “[a]ll delivery orders or task orders are subject to the terms and conditions of this contract. In the event of a conflict between a delivery order or task order and this contract, the contract shall control.” This clause, along with the new conflicts language should adequately address GSA’s concerns thereby allowing continued operation and use of current IT schedule contracts. At the same time, GSA and the IT schedule contractors can continue to engage in thoughtful discussions regarding unique government requirements and commercial practices in software licensing. These discussions should lead to a better understanding on both sides ensuring clear, sound and flexible commercial software license terms on IT schedule contracts.

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