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Develop Terms and Conditions

Develop Terms and Conditions

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In this phase you'll determine the challenge structure and implementation timeline. During this critical step, you'll work with internal groups to establish eligibility and submission requirements, terms and conditions, and judging criteria. You'll connect with your communications team to outline your announcement and ongoing outreach strategy to engage potential solvers.

Other Phases

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Develop Terms and Conditions

Work closely with an agency attorney for this step.

You need to prepare clear terms and conditions for your challenge that participants then must acknowledge. Terms and conditions should address prize eligibility, intellectual property rights (including copyright and trademark), liability and privacy policy.

Some legal authorities mandate specific competition requirements that can be addressed through the terms and conditions. Your agency may also have its own unique constraints.

It may be useful to also consult with an open-source advocate at your agency if you're planning to have the results become open-source.

Key Takeaways

1. Work with your lawyers.

We can't say it enough. Work closely with agency legal counsel as you define your challenge's terms and conditions. You need to understand any legal constraints, applicable policies specific to your agency and the legal authorization to implement the challenge before making final decisions.

An agency could use several legal authorities to structure a prize competition, including the American Innovation and Competitiveness Act (which updated the America COMPETES Act), agency-specific procurement authority and Other Transaction Authority (OTA). There are others as well.

2. Define who's eligible to compete.

Eligibility criteria should reflect your target audience (e.g., students, nonprofits, universities or companies) and ultimate goal (e.g., an algorithm or a poster). This criteria must also adhere to the challenge's legal authorization.

Eligibility is limited to U.S. citizens, residents and companies for most challenges run under the broad legal authority provided by the American Innovation and Competitiveness Act. Even if another legal authority allows for foreign eligibility, it still probably won't allow for participation from restricted countries based on current sanctions.

Age restrictions also could come into play as additional considerations are required to work with solvers under 18.

3. Be aware of liability and indemnification requirements.

The American Innovation and Competitiveness Act has specific requirements that will help guide the development of the terms and conditions for your challenge. Liability is a critical issue.

The law requires participants to obtain liability insurance or demonstrate financial responsibility for damages that could occur while competing in the challenge. Participants must also indemnify the federal government against damage claims.

Again, don't wander into the legal forest alone. Consult your general counsel.

4. Clarify your intellectual property requirements.

Submitted solutions often will be protected or eligible for protection under intellectual property laws. The federal government can't acquire an interest in intellectual property without the participant's written consent. However, the government can negotiate license to use any intellectual property submitted as a solution in a challenge.

When considering requirements, take into account your challenge goals, the federal government's need to license solutions and whether any requirements will create a barrier to participation.

It's crucial to negotiate the Government Purpose Rights of intellectual property as part of the terms and conditions if you plan to acquire solutions for government use after the challenge.

Prizes to Procurement

Use Challenge Results as Technical Evaluation for a Follow-on Procurement: Consult with your contracting office if your challenge will involve a follow-on procurement. Clearly articulate in the terms and conditions that results of a solver's participation in the challenge could augment a full technical proposal for a follow-on FAR-based acquisition.

Use Challenge Results as Part of an Advisory Multi-Step Process: Consult with your contracting office to determine if the terms and conditions stipulate that results of a solver's participation may be used by the agency as the basis to participate in a follow-on acquisition. Familiarize yourself with FAR 15.202(b) Advisory Multi-Step Process.

Include Relevant Terms and Conditions Required for Execution of Intellectual Property Strategy: Engage your agency counsel for advice on how best to develop your intellectual property management strategy. Consider addressing the government intellectual property needs in the terms and conditions for your challenge. For example, the Department of Defense Federal Acquisition Regulation Supplement contains specific language on the use of Government Purpose Rights in technical data and computer software that can facilitate the acquisition of solutions resulting from a challenge. Once these rights are acquired, the associated data and software can be provided to a third-party as government-furnished information in support of a government purpose, such as the execution of a contract.

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