22 CFR 124.9 - Additional clauses required only in manufacturing license agreements.

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§ 124.9 Additional clauses required only in manufacturing license agreements.

(a)Clauses for all manufacturing license agreements. The following clauses must be included only in manufacturing license agreements:

(1) “No export, sale, transfer, or other disposition of the licensed article is authorized to any country outside the territory wherein manufacture or sale is herein licensed without the prior written approval of the U.S. Government unless otherwise exempted by the U.S. Government. Sales or other transfers of the licensed article shall be limited to governments of countries wherein manufacture or sale is hereby licensed and to private entities seeking to procure the licensed article pursuant to a contract with any such government unless the prior written approval of the U.S. Government is obtained.”

(2) “It is agreed that sales by licensee or its sub-licensees under contracts made through the U.S. Government will not include either charges for patent rights in which the U.S. Government holds a royalty-free license, or charges for data which the U.S. Government has a right to use and disclose to others, which are in the public domain, or which the U.S. Government has acquired or is entitled to acquire without restrictions upon their use and disclosure to others.”

(3) “If the U.S. Government is obligated or becomes obligated to pay to the licensor royalties, fees, or other charges for the use of technical data or patents which are involved in the manufacture, use, or sale of any licensed article, any royalties, fees or other charges in connection with purchases of such licensed article from licensee or its sub-licensees with funds derived through the U.S. Government may not exceed the total amount the U.S. Government would have been obligated to pay the licensor directly.”

(4) “If the U.S. Government has made financial or other contributions to the design and development of any licensed article, any charges for technical assistance or know-how relating to the item in connection with purchases of such articles from licensee or sub-licensees with funds derived through the U.S. Government must be proportionately reduced to reflect the U.S. Government contributions, and subject to the provisions of paragraphs (a) (2) and (3) of this section, no other royalties, or fees or other charges may be assessed against U.S. Government funded purchases of such articles. However, charges may be made for reasonable reproduction, handling, mailing, or similar administrative costs incident to the furnishing of such data.”

(5) “The parties to this agreement agree that an annual report of sales or other transfers pursuant to this agreement of the licensed articles, by quantity, type, U.S. dollar value, and purchaser or recipient, shall be provided by (applicant or licensee) to the Department of State.” This clause must specify which party is obligated to provide the annual report. Such reports may be submitted either directly by the licensee or indirectly through the licensor, and may cover calendar or fiscal years. Reports shall be deemed proprietary information by the Department of State and will not be disclosed to unauthorized persons. See § 126.10(b) of this subchapter.

(6) (Licensee) agrees to incorporate the following statement as an integral provision of a contract, commercial invoice or other appropriate document whenever the licensed articles are sold or otherwise transferred:

These items are controlled by the U.S. government and authorized for export only to the country of ultimate destination for use by the ultimate consignee or end-user(s) herein identified. They may not be resold, transferred, or otherwise disposed of, to any other country or to any person other than the authorized ultimate consignee or end-user(s), either in their original form or after being incorporated into other items, without first obtaining approval from the U.S. government or as otherwise authorized by U.S. law and regulations.

(b)Special clause for agreements relating to significant military equipment. With respect to an agreement for the production of significant military equipment, the following additional provisions must be included in the agreement:

(1) “A completed nontransfer and use certificate (DSP-83) must be executed by the foreign end-user and submitted to the Department of State of the United States before any transfer may take place.”

(2) “The prior written approval of the U.S. Government must be obtained before entering into a commitment for the transfer of the licensed article by sale or otherwise to any person or government outside of the approved sales territory.”

[ 58 FR 39305, July 22, 1993, as amended at 81 FR 54736, Aug. 17, 2016]

This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.

This list is taken from the Parallel Table of Authorities and Rules provided by GPO [Government Printing Office].

It is not guaranteed to be accurate or up-to-date, though we do refresh the database weekly. More limitations on accuracy are described at the GPO site.


United States Code
Statutes at Large
Presidential Documents

Executive Order ... 13637

Title 22 published on 2015-11-25

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 22 CFR Part 124 after this date.

  • 2016-12-05; vol. 81 # 233 - Monday, December 5, 2016
    1. 81 FR 87427 - Amendment to the International Traffic in Arms Regulations: Corrections and Clarifications
      GPO FDSys XML | Text
      DEPARTMENT OF STATE
      Final rule; request for comments.
      This Final rule is effective on December 5, 2016. The Department will accept comments on the Final regulation up to January 4, 2017.
      22 CFR Parts 120, 121, 122, 124, 126 and 127
The section you are viewing is cited by the following CFR sections.

Title 22 published on 2015-11-25.

The following are only the Rules published in the Federal Register after the published date of Title 22.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

  • 2016-12-05; vol. 81 # 233 - Monday, December 5, 2016
    1. 81 FR 87427 - Amendment to the International Traffic in Arms Regulations: Corrections and Clarifications
      GPO FDSys: XML | Text
      DEPARTMENT OF STATE
      Final rule; request for comments.
      This Final rule is effective on December 5, 2016. The Department will accept comments on the Final regulation up to January 4, 2017.
      22 CFR Parts 120, 121, 122, 124, 126 and 127