Optional (see Notes section below)
Commonwealth Contract Terms clause C.C.12
This clause relating to licences and approvals makes clear the Supplier’s obligation to obtain any licences or approvals that are necessary in order for the Commonwealth to obtain the full benefit of the goods and/or services provided to it under the Contract.
This includes an obligation on the Supplier to use its best endeavours to obtain:
- Intellectual Property licences;
- Moral Rights releases;
- customs entry for goods; and
- any other approvals necessary.
The phrase “best endeavours” imposes a strict and onerous obligation on the party that owes the obligation. The standard expected of the Supplier is that it will do all that it reasonably can, with the same energy that it would expend if it were protecting or advancing its own interests, to secure the desired result for the Customer.
The clauses relating to warranties are included to ensure that the Customer receives the same warranty protection on goods purchased by the Customer as any other buyer of those goods receives. The clauses require the Supplier to provide the Customer with relevant third-Party warranties relating to goods, or to provide standard manufacturer’s warranty on goods that it manufactures itself.Clause
Licenses, Approvals and Warranties
X.1 At no cost to the Customer, the Supplier must obtain and maintain all Intellectual Property Rights, licences or other approvals required for the lawful provision of the Goods and/or Services and arrange any necessary customs entry for any Goods.
X.2 The Supplier must provide the Customer with all relevant third-party warranties in respect of Goods. If the Supplier is a manufacturer, the Supplier must provide the Customer with all standard manufacturer’s warranties in respect of the Goods it has manufactured and supplied.
X.3 To the extent permitted by laws and for the benefit of the Customer, the Supplier consents, and must use its best endeavours to ensure that each author of Material consents in writing, to the use by the Customer of the Material, even if the use may otherwise be an infringement of their Intellectual Property Rights and/or Moral Rights.
While use of this clause is optional, it is common for contracts to include a clause of this type.
Standardisation of contractual text results in efficiencies for both Parties to a contract. Before deciding whether a particular clause is appropriate, procurement officials should carefully consider the context of their procurement. Capitalised terms (unless otherwise defined) are based on the definitions in the CCS Glossary. Definitions of any relevant defined terms may need to be added.
Clause wording would generally need to be changed where the Customer:
- is willing to share in the cost of obtaining and maintaining Intellectual Property Rights, licence or other approvals; or
- legitimately requires warranty greater than normal commercial warranty; or
- is willing to accept a lower standard of warranty (usually in exchange for a better price or some other improved value), or
- is willing to accept a lower standard than best endeavours from the Supplier.
The clause will also need to be adjusted if the contract includes specific provisions dealing with Moral Rights or the management of third party warranties. Otherwise, where this clause is included, the clause wording should be used without change.
Terms that are capitalised may need to be changed to align with the Contract terminology.