The General Services Administration dropped a draft contract clause on March 6, 2026, that would fundamentally reshape how AI companies do business with the federal government. Titled GSAR 552.239-7001, the proposal introduces mandates around data rights, licensing, and sourcing.
Under the draft, contractors must use only U.S.-developed AI systems across the full supply chain, with foreign components explicitly prohibited. They are banned from using government data to train or enhance their AI models. Contractors must disclose all AI tools within 30 days and report incidents within 72 hours, effectively overriding existing commercial licensing terms. The government would receive a broad, irrevocable, royalty-free license to use any AI system developed under the contract.
Major AI vendors including OpenAI, Anthropic, and the Business Software Alliance raised concerns over the scope. The GSA extended the public comment period to April 3, 2026, and suspended inclusion of the clause in the upcoming MAS Refresh 31. It may be reconsidered for Refresh 32. The proposal aligns with Trump Administration OMB memoranda M-25-21 and M-25-22, which aim to standardize federal AI procurement with an emphasis on American-developed technologies.
For investors, the clause contains no crypto references. The royalty-free licensing means companies must weigh the federal market against the cost of IP surrender. The U.S.-only sourcing requirement creates a competitive moat for firms with fully American supply chains, locking out foreign AI suppliers entirely.