GSA Releases Draft AI Clause Ahead of Upcoming MAS Refresh
The General Services Administration (GSA) has released a draft of artificial intelligence (AI) terms and conditions intended for inclusion in its upcoming Multiple Award Schedule (MAS) refresh, scheduled for late March or April 2026. This new clause, identified as GSAR 552.239-7001, represents a significant step in defining contractor obligations regarding the deployment of AI capabilities in federal contracts.
Background: Federal Procurement of AI in Focus
This release comes amidst increasing scrutiny of the federal government’s procurement of AI technologies. Following a public fallout with Anthropic, all federal agencies were instructed to halt the use of the company’s technology due to a dispute with the Department of Defense (DoD). The conflict arose over the DoD’s demand for unrestricted usage of Anthropic’s large language model, which the company resisted, leading to its designation as a “supply chain risk”.
This incident highlights the tensions between commercial AI providers, who often impose restrictions through commercial terms, and the federal government’s expectation for unrestricted access to AI technologies procured under federal contracts.
The Draft Clause
Contractor Responsibility for Service Providers
The draft clause applies universally to all MAS contractors utilizing AI systems during contract performance, regardless of whether these systems are provided directly to the government or embedded within contractor workflows. A “Service Provider” is defined as any entity that provides, operates, or licenses an AI system without being a party to the contract.
Crucially, the contractor bears the responsibility for ensuring that these Service Providers comply with the clause, even if they are not direct subcontractors.
Order of Precedence
This clause includes an order of precedence provision, which overrides any conflicting standard terms and conditions set by AI service providers. This means that if there is a conflict between the GSA clause and an AI vendor’s standard terms, the GSA clause will take precedence.
Government Ownership: “Government Data” and “Custom Developments”
The government asserts full ownership over all “Government Data” and “Custom Developments”. This includes:
- Data Inputs: Content submitted to the AI system by or for the government.
- Data Outputs: Content generated by the AI system during contract performance.
Furthermore, any modifications or enhancements made to AI systems for government use must be dedicated to the government’s exclusive use and treated as confidential information.
Government License
The draft clause mandates that contractors grant the government an irrevocable, royalty-free, non-exclusive license to use the AI system for any lawful government purpose. This includes:
- Operating and accessing the AI system.
- Inputting Data Inputs and receiving Data Outputs.
- Allowing authorized personnel to use the AI system.
Importantly, the clause indicates that the AI system must not refuse to produce data outputs or analyses based on the contractor’s policies, ensuring that lawful federal tasks cannot be obstructed by vendor-imposed restrictions.
Disclose Use of All AI Systems
Contractors are required to disclose all AI systems utilized in contract performance within 30 days of award. This includes any modifications made to comply with foreign regulatory frameworks, as these can affect system behavior during U.S. government use.
Government Data Handling and Processing
The draft clause necessitates that contractors implement safeguards to protect Government Data, enforce data handling procedures that restrict human review, and maintain detailed records of all processing activities involving Government Data. Upon contract completion, all Government Data and Custom Developments must be securely deleted.
Conclusion
This draft AI clause signifies a notable shift away from standard commercial buying practices towards a more government-first approach in AI procurement. MAS contractors are urged to begin inventorying all AI systems used in their performance and review the terms and conditions thoroughly. With the expansive ownership requirements and the mandate to use only American AI Systems, contractors may face significant challenges in continuing to utilize AI technologies.
