Government Maximum Price

[bocajohn]

I was told that once you sell an item (patented or not) you may not sell to the US Govt, absent exceptional circimstances or market forces (i.e., increased cost of materials), at a price GREATER than that charged to your non-Governmental customer?

This has nothing to do with cost contracts.

A second question would be: is there a maximum mark-up allowed for equipment sold to the US Government (I realize there are many variables here).

Thanks, in advance, for your advice.

bocajohn

[Guest Vern Edwards]

There is no universally applicable rule that says you cannot charge the government more than you charge to a non-government customer. You may be thinking of a clause that GSA and perhaps some other agencies may put in their contracts in which the contractor agrees to give the government the same price that it charges in sales to its most favored customer, unless the contractor can show that the terms of such sales are different than those of the government contract.

There is no maximum price markup for fixed-price government contracts, except any that the parties may have agreed to in a particular contract.

[outsidelegalguy]

GSA doesn't require that you sell to them at the price you sell to your most favored customer. That's their general negotiating position (or, sometimes, that they want even better than that) and you have to disclose your pricing practices and the price charged to your most favored customer as part of negotiating a GSA contract. But, you don't have to give GSA your best price. Of course, GSA also doesn't have to award you a contract.