[Federal Register: May 28, 2003 (Volume 68, Number 102)]
[Proposed Rules]
[Page 31789-31817]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr28my03-26]
[[Page 31789]]
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Part III
Department of Defense
General Services Administration
National Aeronautics and Space Administration
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48 CFR Parts 2, et al.
Federal Acquisition Regulation; FAR Part 27 Rewrite in Plain Language;
Proposed Rule
[[Page 31790]]
DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 2, 19, 27, 52
[FAR Case 1999-402]
RIN 9000-AJ64
Federal Acquisition Regulation; FAR Part 27 Rewrite in Plain
Language
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Proposed rule.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) are proposing to amend the
Federal Acquisition Regulation (FAR) to clarify, streamline, and update
guidance and clauses on patents, data, and copyrights to provide a more
logical presentation of this complex material.
DATES: Interested parties should submit comments in writing on or
before July 28, 2003 to be considered in the formulation of a final
rule.
ADDRESSES: Submit written comments to--General Services Administration,
FAR Secretariat (MVA), 1800 F Street, NW, Room 4035, ATTN: Laurie
Duarte, Washington, DC 20405.
Submit electronic comments via the Internet to--farcase.1999-
402@gsa.gov. Please submit comments only and cite FAR case 1999-402 in all
correspondence related to this case.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC, 20405, at (202) 501-4755 for information
pertaining to status or publication schedules. For clarification of
content, contact Ms. Victoria Moss, Procurement Analyst, at (202) 501-
4764. Please cite FAR case 1999-402.
SUPPLEMENTARY INFORMATION:
A. Background
The rule constitutes a rewrite of FAR Part 27 and its associated
clauses in Part 52. Part 27 implements a number of statutes and
executive orders pertaining to patents, data, and copyrights. The
effort to rewrite FAR Part 27 was undertaken to make the various
policies and procedures that implement these statutes and executive
orders more succinct and understandable to the reader. In addition to
numerous editorial and structural changes, some existing policies and
procedures were clarified to eliminate potential confusion among
responsible parties and make clearer the distinction between the rights
and obligations of the contractor and the Government. While this FAR
case was designed primarily to make the contents of FAR Part 27 easier
to understand, as opposed to changing underlying policies, some
substantive changes have also been made to reflect changes to the
various laws covering the subject matter in FAR Part 27. A discussion
of the proposed substantive changes and the associated rationale for
these changes are provided below along with a description of the
``plain language'' changes that have been made.
The following more specifically summarizes the proposed changes:
1. General. We have identified and moved the prescriptive language
for the solicitation provisions and contract clauses into discrete
subsections. Additionally, an effort has been made to eliminate
language in the text that duplicates existing clause language.
2. Definitions. A definition of ``commercial computer software''
was added to FAR Part 2 because this term is referenced in both Parts
12 and 27. A consistent definition for ``commercial computer software''
is needed to distinguish ``commercial computer software'' from
``restricted computer software,'' the distinction being that commercial
computer software must have been sold commercially and restricted
computer software may have not been so sold, leased, or licensed. The
clause at 52.227-19 helps contracting officers because FAR 12.212 does
not provide much guidance with respect to what is and what is not
permissible in Government contracts. In particular, FAR Part 12 does
not provide much guidance to contracting officers with respect to that
which is consistent with Federal law and that which would normally
satisfy Government needs. The clause at 52.227-19, if a contracting
officer decides to insert it, ensures that the customary commercial
license is consistent with Federal law and normally covers all the
rights that the Government needs in commercial computer software.
A definition of ``United States,'' unique to part 27, was added at
FAR 27.001.
3. FAR subpart 27.1 was rewritten to make it more succinct and to
eliminate extraneous text. FAR 27.103, Policy, was deleted in its
entirety because it merely stated the policies concerning patents,
copyrights, and data that were in Part 27. An obsolete description of
commercial items was removed from FAR 27.102 and replaced with the term
``commercial item,'' which is defined in Part 2.
4. FAR Subpart 27.2 was rewritten to better explain the purpose
behind the use of the authorization and consent clause and its
alternatives, the notification and assistance clause, the patent
indemnity clause and its alternatives, and the patent royalty clause.
Related sections were grouped together under section headings to more
accurately reflect the specific subject matter and guidance presented
to the contracting officer (e.g., ``27.201, Patent and copyright
infringement liability,'' currently under current sections 27.201
through 27.203).
Much of the general explanation of the Authorization and Consent
clause in FAR 27.201 was extraneous and unnecessarily complicated given
that the clause is required in the vast majority of contracts and the
exceptions to the use of the clause are very clear. New clear and
succinct guidance points out that the notice and assistance clause is
to be used when the authorization and consent clause is used. This
eliminated the need to repeat when the authorization and consent clause
is used in the prescriptive language for the notice and assistance
clause. The lengthy descriptions for use of the patent indemnity clause
and its alternates have been eliminated. The text was amended by using
the term, ``commercial item,'' and referencing the simplified
acquisition procedures as an exclusion to the clause's use. This was
done because the FAR clause at 52.212-4 has a patent indemnity
provision in it and it greatly simplified the prescriptive language
using common reference terms with which contracting officers are
familiar.
In the new FAR section 27.202, Royalties, the coverage on refund of
royalties was consolidated to one sentence to eliminate confusion
resulting from mixing prescriptive language and explanatory text.
The new FAR section 27.203 replaces 27.207, and the title is
changed from ``Classified contracts'' to ``Security requirements for
patent applications containing classified subject matter.'' The new
title more accurately addresses any patent application that may include
classified subject matter, regardless of the classification of the
contract.
5. FAR Subpart 27.3 is one of the more legally complex subparts in
the FAR. Therefore, it was difficult to edit any portion of this
subpart without substantively changing the meaning of the prescriptive
language and/or procedures. This subpart primarily implements the Bayh-
Dole Act (Act),
[[Page 31791]]
Title 35 U.S.C., Chapter 18. This Act has a long and involved history,
which is why there are so many legal nuances to this subpart. A brief
history of the distinction that the Act makes between small businesses/
nonprofit organization and large for-profit business will put this in
perspective. Initially, the Act was only made applicable to small
business firms and nonprofit organizations. This was changed when
President Reagan issued a Presidential memorandum and, later, an
Executive order that made the Act applicable to all entities regardless
of size. However, Congress later amended the Act to make only several
of its sections applicable to large for-profit businesses. Accordingly,
there is an inherent statutory distinction between small business/
nonprofits and large for-profits. While this proposed rule maintains
this distinction, many of the sections were retitled and alternate
words were used to help clarify some of the misinterpretations of this
subpart that have occurred in the past.
It should be emphasized that the Act makes the Department of
Commerce responsible for issuing regulations concerning its
implementation. Therefore, any changes to the FAR must conform to 37
CFR part 401.
Extraneous text at FAR 27.302(b)(1) was eliminated to simply state
that pursuant to law, a contractor may elect to retain title to any
subject invention. This is the main concept behind the Act; that is, to
allow small businesses and nonprofits to commercialize subject
inventions. Paragraphs (b)(2) through (b)(5) of FAR 27.302 were
restructured in order to emphasize that the Government only acquires
title to a subject invention in very limited circumstances.
FAR 27.303 was reorganized for clarity as follows:
[sbull] Language previously located at FAR 27.304-3, which was
merely referenced in 27.303 pertaining to solicitations or contracts
for construction work or architect-engineer services, was moved to
27.303(a)(2) for readability.
[sbull] The title of the clause at 52.227-11 was changed to provide
a more accurate description of the clause content. Currently, the FAR
clauses at 52.227-11 and 52.227-12 are titled ``Short Form'' and ``Long
Form,'' respectively. While 52.227-11 may be a little shorter as it is
currently written, it is still a sizable clause, so the distinction
between short and long has never proved very helpful. Further, the term
``Retention'' was removed from the title of the clause at 52.227-11 and
replaced with ``Ownership'', which is a more common term. Additionally,
since the Department of Defense is apparently the only agency using the
clause at 52.227-12, it was deleted from the FAR and will be moved to
the Defense Federal Acquisition Regulation Supplement under a separate
case.
[sbull] The clause prescriptive language throughout FAR 27.303(b)
was amended to conform to FAR plain language convention.
[sbull] FAR 27.303(e)(1)(iv) was language taken in large part from
27.303(d).
[sbull] FAR 27.303(e)(2) was reorganized to more clearly describe
the implementation procedures of 37 CFR part 401 that pertain to the
exceptions in a contract with a small business concern or a nonprofit
organization.
[sbull] FAR 27.303(e)(3) was more appropriately moved to 27.304-
1(b)(2) because it is not prescriptive language.
FAR 27.304 was similarly reorganized for clarity as follows:
[sbull] The procedures for a small business/nonprofit organization
to appeal an agency's exercise of the exceptions at FAR 27.303(c)(1)(i)
through (c)(1)(iv) or of march-in rights were deleted in their entirety
and replaced with a sentence referencing the Department of Commerce's
regulations on the subject. Since these procedures are copied verbatim
from the Commerce regulations, they did not need to be repeated.
Moreover, agencies rarely exercise these rights and, accordingly, it
was further felt that these procedures did not have to be included in
the FAR.
[sbull] The additional requirements delineated at FAR 27.304-1(e)
were deleted because they duplicated existing language at 27.303(b)(2)
and (c)(3). However, the language pertaining to the contractor's
responsibility for delivering confirmation of the right of the
contracting officer to inspect and make copies of the patent
application file at 27.304-1(e)(3) was retained and moved to 27.305.
In FAR 27.305, slightly different titles to the subsections were
used to make them more accurately depict the subject matter. Also,
27.305-2 was deleted because it duplicated language already contained
in the patent rights clause.
6. FAR Subpart 27.4 was changed to provide clarity and updated
information as follows:
[sbull] In FAR 27.401, a definition of ``Computer data base'' was
added to provide consistency throughout the rest of the part. As noted
previously, a definition for ``Commercial computer software'' was added
to FAR Part 2 because this term is used in Parts 12 and 27. The
definition of ``Computer software'' was changed to provide a more
meaningful and accurate definition of the term. The definition of this
term is derived from the definition of the same term in the Department
of Energy Acquisition Regulation (DEAR) (see 48 CFR 927.409). Further,
the definition of ``Technical data'' was rewritten to comply with the
definition of ``Technical data'' in 41 U.S.C. 403.
FAR 27.404 was subdivided into several subsections for better
readability. 27.404-2(c)(3) was redrafted to expressly state that
computer databases must be treated as technical data and not computer
software. This accurately reflects the law in this area.
[sbull] The most significant change made in FAR Subpart 27.4 was
made to, what is now designated, 27.404-3. Currently, the coverage of
copyrighted works in the FAR is premised on law that has long been
changed. Since under existing law, an original work of authorship is
copyrighted as soon as it is put in a tangible media (e.g., writing
something down). Therefore, the use of the term, ``establish'' is
inappropriate. Instead, the term ``assert'' was substituted to
accurately reflect that a contractor already has a copyright in any
data first produced under a contract. The use of the term ``assert,''
however, gives the Government the opportunity to provide permission
before the contractor can act on its rights in the copyright, as is the
current practice. This section was also redrafted to reflect the
current practice of normally allowing contractors to assert their
copyrights in data first produced under a contract. The information
previously contained in paragraphs 27.404(f)(2)(ii) and (iii) was
rewritten to reflect current law on notice/publication requirements for
copyrights.
[sbull] The clause prescriptive language pertinent to use of the
clause at 52.227-17, Rights in Data--Special Works, which was
previously located within the text material at 52.405-1(c), (d), and
(e), has been moved to 27.409.
[sbull] Section 27.405(c) was deleted. This language duplicates
language in the clause.
7. FAR Subpart 27.6 was redesignated as 27.5, Foreign License and
Technical Assistance Agreements, and was reduced to a single sentence.
The remainder of the coverage of this part was addressed in the other
parts.
8. FAR 52.227 clauses and provisions were largely redrafted to
reflect ``plain language'' changes that may substantially improve
clarity as follows:
[sbull] 52.227-11 and 52.227-13 will be addressed together because
most of the changes were of a similar nature. The changes to the titles
have already been discussed. The clause at FAR 52.227-11 was
restructured to make the distinction between the rights and obligations
of the contractor and the Government clearer.
[[Page 31792]]
While this looks like a substantial revision, it really only involves
moving different paragraphs to places that fit the designated
restructure. In new paragraph (c)(3), a distinction of different types
of patent applications had to be made, i.e., between provisional and
nonprovisional patent applications, to accurately reflect current
practices at the United States Patent and Trademark Office. As
discussed previously, new paragraph (i) was substantially rewritten to
eliminate the entire section on march-in rights, leaving only a
reference to the provision of the Bayh-Dole Act that requires these
rights. It was felt that this is sufficient because the rights of the
Government stem directly from the statute and need not be reiterated in
the clauses. Similarly, in the new paragraph (d)(2) of the clause at
52.227-13, much of the procedures to review a decision to revoke a
license have been removed and the prescriptive language has been cited.
[sbull] Any changes to the clause at 52.227-14 conform to the
prescriptive text changes at FAR Subpart 27.4, Rights in Data and
Copyrights.
[sbull] Only ``plain language'' changes were made to the remaining
clauses at 52.227-15, 52.227-17, 52.227-19, 52.227-20, and 52.227-21.
This is not a significant regulatory action and, therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The Councils do not expect this proposed rule to have a significant
economic impact on a substantial number of small entities within the
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq.,
because while we have made changes in accordance with plain language
guidelines, we have only made minimal substantive changes to the
policies, procedures, and contract clauses pertaining to patents or the
directions to agencies to develop coverage for rights in data and
copyrights. An Initial Regulatory Flexibility Analysis has, therefore,
not been performed. We invite comments from small businesses and other
interested parties. The Councils will consider comments from small
entities concerning the affected FAR Parts 2, 19, 27, and 52 in
accordance with 5 U.S.C. 610. Interested parties must submit such
comments separately and should cite 5 U.S.C. 601, et seq. (FAR case
1999-402), in correspondence.
C. Paperwork Reduction Act
The Paperwork Reduction Act (Pub. L. 104-13) applies because the
proposed rule contains information collection requirements. The current
paperwork burden associated with FAR Subpart 27.3 (under OMB Control
Number 9000-0095) will be modified to account for the reduction of
burden associated with the removal of the clause at 52.227-12 from the
FAR. We estimate a burden reduction of 13,689 hours (30 percent of the
45,630 total burden) associated with this clause. The burden hours
associated with this clause will be added to OMB Control Number 0704-
0369 under a separate case.
List of Subjects in 48 CFR Parts 2, 19, 27, and 52
Government procurement.
Dated: May 16, 2003.
Laura G. Smith,
Director, Acquisition Policy Division.
Therefore, DoD, GSA, and NASA propose amending 48 CFR parts 2, 19,
27, and 52 as set forth below:
1. The authority citation for 48 CFR parts 2, 19, 27, and 52 is
revised to read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
PART 2--DEFINITIONS OF WORDS AND TERMS
2. Amend section 2.101 by adding, in alphabetical order, the
definitions ``Commercial computer software'' and ``Small business
concern'', and by revising the definition ``United States'' to read as
follows:
2.101 Definitions.
* * * * *
Commercial computer software means any computer program, computer
data base, or documentation that has been sold, leased, or licensed to
the general public.
* * * * *
Small business concern means a concern, including its affiliates,
that is independently owned and operated, not dominant in the field of
operation in which it is bidding on Government contracts, and qualified
as a small business under the criteria and size standards in 13 CFR
part 121 (see 19.102). Such a concern is ``not dominant in its field of
operation'' when it does not exercise a controlling or major influence
on a national basis in a kind of business activity in which a number of
business concerns are primarily engaged. In determining whether
dominance exists, consideration must be given to all appropriate
factors, including volume of business, number of employees, financial
resources, competitive status or position, ownership or control of
materials, processes, patents, license agreements, facilities, sales
territory, and nature of business activity.
* * * * *
United States, when used in a geographic sense, means the 50 States
and the District of Columbia, except as follows:
(1) For use in subpart 22.8, see the definition at 22.801.
(2) For use in subpart 22.10, see the definition at 22.1001.
(3) For use in part 25, see the definition at 25.003.
(4) For use in part 27, see the definition at 27.001.
(5) For use in subpart 47.4, see the definition at 47.401.
* * * * *
PART 19--SMALL BUSINESS PROGRAMS
19.001 [Amended]
3. Amend section 19.001 by removing the definition ``Small business
concern.''
4. Revise part 27 to read as follows:
PART 27--PATENTS, DATA, AND COPYRIGHTS
Sec.
27.000 Scope of part.
27.001 Definition.
Subpart 27.1--General
27.101 Applicability.
27.102 General guidance.
Subpart 27.2--Patents
27.200 Scope of subpart.
27.201 Patent and copyright infringement liability.
27.201-1 General.
27.201-2 Contract clauses.
27.202 Royalties.
27.202-1 Reporting of royalties.
27.202-2 Notice of Government as a licensee.
27.202-3 Adjustment of royalties.
27.202-4 Refund of royalties.
27.202-5 Solicitation provisions and contract clause.
27.203 Security requirements for patent applications containing
classified subject matter.
27.203-1 General.
27.203-2 Contract clause.
27.204 Patented technology under trade agreements.
27.204-1 Use of patented technology under the North American Free
Trade Agreement.
27.204-2 Use of patented technology under the General Agreement on
Tariffs and Trade (GATT).
[[Page 31793]]
Subpart 27.3--Patent Rights Under Government Contracts
27.300 Scope of subpart.
27.301 Definitions.
27.302 Policy.
27.303 Contract clauses.
27.304 Procedures.
27.304-1 General.
27.304-2 Contracts placed by or for other Government agencies.
27.304-3 Subcontracts.
27.304-4 Appeals.
27.305 Administration of patent rights clauses.
27.305-1 Goals.
27.305-2 Administration by the Government.
27.305-3 Securing invention rights acquired by the Government.
27.305-4 Protection of invention disclosures.
27.306 Licensing background patent rights to third parties.
Subpart 27.4--Rights in Data and Copyrights
27.400 Scope of subpart.
27.401 Definitions.
27.402 Policy.
27.403 Data rights--General.
27.404 Basic rights in Data clause.
27.404-1 Unlimited rights data.
27.404-2 Limited rights data and restricted computer software.
27.404-3 Copyrighted works.
27.404-4 Contractor's release, publication, and use of data.
27.404-5 Unauthorized, omitted, or incorrect markings.
27.404-6 Inspection of data at the contractor's facility.
27.405 Other data rights provisions.
27.405-1 Special works.
27.405-2 Existing works.
27.405-3 Commercial computer software.
27.406 Acquisition of data.
27.406-1 General.
27.406-2 Additional data requirements.
27.406-3 Major system acquisition.
27.407 Rights to technical data in successful proposals.
27.408 Cosponsored research and development activities.
27.409 Solicitation provisions and contract clauses.
Subpart 27.5--Foreign License and Technical Assistance Agreements
27.501 General.
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
27.000 Scope of part.
This part prescribes the policies, procedures, solicitation
provisions, and contract clauses pertaining to patents, data, and
copyrights.
27.001 Definition.
United States, as used in this part, means the 50 States and the
District of Columbia, U.S. territories and possessions, Puerto Rico,
and the Northern Mariana Islands.
27.101 Applicability.
This part applies to all agencies. However, agencies are authorized
to adopt alternate policies, procedures, solicitation provisions, and
contract clauses to the extent necessary to meet the specific
requirements of laws, executive orders, treaties, or international
agreements. Any agency adopting alternate policies, procedures,
solicitation provisions, and contract clauses should include them in
the agency's published regulations.
27.102 General guidance.
(a) The Government encourages the maximum practical commercial use
of inventions made under Government contracts.
(b) Generally, the Government will not refuse to award a contract
on the grounds that the prospective contractor may infringe a patent.
The Government may authorize and consent to the use of inventions in
the performance of certain contracts, even though the inventions may be
covered by U.S. patents.
(c) Generally, contractors providing commercial items should
indemnify the Government against liability for the infringement of U.S.
patents.
(d) The Government recognizes rights in data developed at private
expense, and limits its demands for delivery of that data. When such
data is delivered, the Government will acquire only those rights
essential to its needs.
(e) Generally, the Government requires that contractors obtain
permission from copyright owners before including copyrighted works,
owned by others, in data to be delivered.
Subpart 27.2--Patents
27.200 Scope of subpart.
This subpart prescribes policies and procedures with respect to--
(a) Patent and copyright infringement liability;
(b) Royalties;
(c) Security requirements for patent applications containing
classified subject matter; and
(d) Patented technology under trade agreements.
27.201 Patent and copyright infringement liability.
27.201-1 General.
(a) Pursuant to 28 U.S.C. 1498, the exclusive remedy for patent or
copyright infringement by or on behalf of the Government is a suit for
monetary damages against the Government in the Court of Federal Claims.
There is no injunctive relief available, and there is no direct cause
of action against a contractor that is infringing a patent or copyright
on behalf of the Government (e.g., while performing a contract).
(b) The Government may expressly authorize and consent to a
contractor's use or manufacture of inventions covered by U.S. patents
by inserting the clause at 52.227-1, Authorization and Consent.
(c) Because of the exclusive remedies granted in 28 U.S.C. 1498,
the Government requires notice and assistance from its contractors
regarding any claims for patent or copyright infringement by inserting
the clause at 52.227-2, Notice and Assistance Regarding Patent and
Copyright Infringement.
(d) The Government may require a contractor to reimburse it for
liability for patent infringement arising out of a contract for
commercial items by inserting the clause at FAR 52.227-3, Patent
Indemnity.
27.201-2 Contract clauses.
(a)(1) Insert the clause at 52.227-1, Authorization and Consent, in
solicitations and contracts except that use of the clause is--
(i) Optional when using simplified acquisition procedures; and
(ii) Prohibited when both complete performance and delivery are
outside the United States.
(2) Use the clause with its Alternate I in all R&D solicitations
and contracts for which the primary purpose is R&D work, except that
this alternate shall not be used in construction and architect-engineer
contracts unless the contract calls exclusively for R&D work.
(3) Use the clause with its Alternate II in solicitations and
contracts for communication services with a common carrier and if
services are unregulated and not priced by a tariff schedule set by a
regulatory body.
(b) Insert the clause at 52.227-2, Notice and Assistance Regarding
Patent and Copyright Infringement, in all solicitations and contracts
that include the clause at 52.227-1, Authorization and Consent.
(c)(1) Insert the clause at 52.227-3, Patent Indemnity, in
solicitations and contracts that may result in the delivery of
commercial items, unless--
(i) The simplified acquisition procedures of Part 13 are used;
(ii) Part 12 procedures are used;
(iii) Both complete performance and delivery are outside the United
States; or
(iv) The contracting officer determines after consultation with
legal counsel that omission of the clause would be consistent with
commercial practice.
(2) Use the clause with either its Alternate I (identification of
excluded
[[Page 31794]]
items) or II (identification of included items) if--
(i) The contract also requires delivery of noncommercial items; or
(ii) The contracting officer determines after consultation with
legal counsel that limitation of applicability of the clause would be
consistent with commercial practice.
(3) Use the clause with its Alternate III if the solicitation or
contract is for communication services and facilities where performance
is by a common carrier, and the services are unregulated and are not
priced by a tariff schedule set by a regulatory body.
(d)(1) Insert the clause at 52.227-4, Patent Indemnity--
Construction Contracts, in solicitations and contracts for construction
or that are fixed-price for dismantling, demolition, or removal of
improvements. Do not insert the clause in contracts solely for
architect-engineer services.
(2) If the contracting officer determines that the construction
will necessarily involve the use of structures, products, materials,
equipment, processes, or methods that are nonstandard, noncommercial,
or special, the contracting officer may expressly exclude them from the
patent indemnification by using the clause with its Alternate I. Note
that this exclusion is for items, as distinguished from identified
patents (see paragraph (e) of this subsection).
(e) It may be in the Government's interest to exempt specific U.S.
patents from the patent indemnity clause. Exclusion from indemnity of
identified patents, as distinguished from items, is the prerogative of
the agency head. Upon written approval of the agency head, the
contracting officer may insert the clause at 52.227-5, Waiver of
Indemnity, in solicitations and contracts in addition to the
appropriate patent indemnity clause.
(f) If a patent indemnity clause is not prescribed, the contracting
officer may include one in the solicitation and contract if it is in
the Government's interest to do so.
(g) The contracting officer shall not include in any solicitation
or contract any clause whereby the Government agrees to indemnity a
contractor for patent infringement.
27.202 Royalties.
27.202-1 Reporting of royalties.
(a) To determine whether royalties anticipated or actually paid
under Government contracts are excessive, improper, or inconsistent
with Government patent rights, the solicitation provision at 52.227-6
requires prospective contractors to furnish royalty information. The
contracting officer shall take appropriate action to reduce or
eliminate excessive or improper royalties.
(b) If the response to a solicitation includes a charge for
royalties, the contracting officer shall, before award of the contract,
forward the information to the office having cognizance of patent
matters for the contracting activity. The cognizant office shall
promptly advise the contracting officer of appropriate action.
(c) The contracting officer, when considering the approval of a
subcontract, must require royalty information if it is required under
the prime contract. The contracting officer shall forward the
information to the office having cognizance of patent matters. However,
the contracting officer need not delay consent while awaiting advice
from the cognizant office.
(d) The contracting officer shall forward any royalty reports to
the office having cognizance of patent matters for the contracting
activity.
27.202-2 Notice of Government as a licensee.
(a) When the Government is obligated to pay a royalty on a patent
because of an existing license agreement and the contracting officer
believes that the licensed patent will be applicable to a prospective
contract, the Government should furnish the prospective offerors with--
(1) Notice of the license;
(2) The number of the patent; and
(3) The royalty rate cited in the license.
(b) When the Government is obligated to pay such a royalty, the
solicitation should also require offerors to furnish information
indicating whether or not each offeror is the patent owner or a
licensee under the patent. This information is necessary so that the
Government may either--
(1) Evaluate an offeror's price by adding an amount equal to the
royalty; or
(2) Negotiate a price reduction with an offeror when the offeror is
licensed under the same patent at a lower royalty rate.
27.202-3 Adjustment of royalties.
(a) If at any time the contracting officer believes that any
royalties paid, or to be paid, under a contract or subcontract are
inconsistent with Government rights, excessive, or otherwise improper,
the contracting officer shall promptly report the facts to the office
having cognizance of patent matters for the contracting activity
concerned.
(b) In coordination with the cognizant office, the contracting
officer shall promptly act to protect the Government against payment of
royalties--
(1) With respect to which the Government has a royalty-free
license;
(2) At a rate in excess of the rate at which the Government is
licensed; or
(3) When the royalties in whole or in part otherwise constitute an
improper charge.
(c) In appropriate cases, the contracting officer, in coordination
with the cognizant office, shall demand a refund pursuant to any refund
of royalties clause in the contract (see 27.202-4) or negotiate for a
reduction of royalties.
(d) For guidance in evaluating information furnished pursuant to
27.202-1, see 31.205-37. See also 31.109 regarding advance
understandings on particular cost items, including royalties.
27.202-4 Refund of royalties.
The clause at 52.227-9, Refund of Royalties, establishes procedures
to pay the contractor royalties under the contract and recover
royalties not paid by the contractor when the royalties were included
in the contractor's fixed price.
27.202-5 Solicitation provisions and contract clause.
(a)(1) Insert a solicitation provision substantially the same as
the provision at 52.227-6, Royalty Information, in--
(i) Any solicitation that may result in a negotiated contract for
which royalty information is desired and for which cost or pricing data
are obtained under 15.403; or
(ii) Sealed bid solicitations only if the need for such information
is approved at a level above the contracting officer as being necessary
for proper protection of the Government's interests.
(2) If the solicitation is for communication services and
facilities by a common carrier, use the provision with its Alternate I.
(b) If the Government is obligated to pay a royalty on a patent
involved in the prospective contract, insert in the solicitation a
provision substantially the same as the provision at 52.227-7,
Patents--Notice of Government Licensee. If the clause at 52.227-6 is
not included in the solicitation, the contracting officer may require
offerors to provide information sufficient to provide this notice to
the other offerors.
(c) Insert the clause at 52.227-9, Refund of Royalties, in
negotiated fixed-price solicitations and contracts when
[[Page 31795]]
royalties may be paid under the contract. If a fixed-price incentive
contract is contemplated, change ``price'' to ``target cost and target
profit'' wherever it appears in the clause. The clause may be used in
cost-reimbursement contracts where agency approval of royalties is
necessary to protect the Government's interests.
27.203 Security requirements for patent applications containing
classified subject matter.
27.203-1 General.
(a) Unauthorized disclosure of classified subject matter, whether
in patent applications or resulting from the issuance of a patent, may
be a violation of 18 U.S.C. 792, et seq. (Espionage and Censorship),
and related statutes, and may be contrary to the interests of national
security.
(b) Upon receipt of a patent application under paragraph (a) or (b)
of the clause at 52.227-10, Filing of Patent Applications--Classified
Subject Matter, the contracting officer shall ascertain the proper
security classification of the patent application. If the application
contains classified subject matter, the contracting officer shall
inform the contractor how to transmit the application to the United
States Patent Office in accordance with procedures provided by legal
counsel. If the material is classified ``Secret'' or higher, the
contracting officer shall make every effort to notify the contractor
within 30 days of the Government's determination, pursuant to paragraph
(a) of the clause.
(c) Upon receipt of information furnished by the contractor under
paragraph (d) of the clause at 52.227-10, the contracting officer shall
promptly submit that information to legal counsel in order that the
steps necessary to ensure the security of the application will be
taken.
(d) The contracting officer shall act promptly on requests for
approval of foreign filing under paragraph (c) of the clause at 52.227-
10 in order to avoid the loss of valuable patent rights of the
Government or the contractor.
27.203-2 Contract clause.
Insert the clause at 52.227-10, Filing of Patent Applications--
Classified Subject Matter, in all classified solicitations and
contracts and in all solicitations and contracts where the nature of
the work reasonably might result in a patent application containing
classified subject matter.
27.204 Patented technology under trade agreements.
27.204-1 Use of patented technology under the North American Free
Trade Agreement.
(a) The requirements of this section apply to the use of technology
covered by a valid patent when the patent holder is from a country that
is a party to the North American Free Trade Agreement (NAFTA).
(b) Article 1709(10) of NAFTA generally requires a user of
technology covered by a valid patent to make a reasonable effort to
obtain authorization prior to use of the patented technology. However,
NAFTA provides that this requirement for authorization may be waived in
situations of national emergency or other circumstances of extreme
urgency, or for public noncommercial use.
(c) Section 6 of Executive Order 12889, ``Implementation of the
North American Free Trade Act,'' of December 27, 1993, waives the
requirement to obtain advance authorization for an invention used or
manufactured by or for the Federal Government. However, the patent
owner shall be notified in advance whenever the agency or its
contractor knows or has reasonable grounds to know, without making a
patent search, that an invention described in and covered by a valid
U.S. patent is or will be used or manufactured without a license. In
cases of national emergency or other circumstances of extreme urgency,
this notification need not be made in advance, but must be made as soon
as reasonably practicable.
(d) The contracting officer, in consultation with the office having
cognizance of patent matters, shall ensure compliance with the notice
requirements of NAFTA Article 1709(10) and Executive Order 12889. A
contract award should not be suspended pending notification to the
patent owner.
(e) Section 6(c) of Executive Order 12889 provides that the notice
to the patent owner does not constitute an admission of infringement of
a valid privately owned patent.
(f) When addressing issues regarding compensation for the use of
patented technology, Government personnel should be advised that NAFTA
uses the term ``adequate remuneration.'' Executive Order 12889 equates
``remuneration'' to ``reasonable and entire compensation'' as used in
28 U.S.C. 1498, the statute that gives jurisdiction to the U.S. Court
of Federal Claims to hear patent and copyright cases involving
infringement by the Government.
(g) When questions arise regarding the notice requirements or other
matters relating to this section, the contracting officer should
consult with legal counsel.
27.204-2 Use of patented technology under the General Agreement on
Tariffs and Trade (GATT).
Article 31 of Annex 1C, Agreement on Trade-Related Aspects of
Intellectual Property Rights, to GATT (Uruguay Round) addresses
situations where the law of a member country allows for use of a patent
without authorization, including use by the Government.
Subpart 27.3--Patent Rights Under Government Contracts
27.300 Scope of subpart.
This subpart prescribes policies, procedures, solicitation
provisions, and contract clauses pertaining to inventions made in the
performance of work under a Government contract or subcontract for
experimental, developmental, or research work. Agency policies,
procedures, solicitation provisions, and contract clauses may be
specified in agency supplemental regulations as permitted by law.
27.301 Definitions.
As used in this subpart--
Invention means any invention or discovery that is or may be
patentable or otherwise protectable under title 35 of the U.S. Code, or
any novel variety of plant that is or may be protectable under the
Plant Variety Protection Act (7 U.S.C. 2321, et seq.).
Made, when used in relation to any invention, means the conception
or first actual reduction to practice of the invention.
Nonprofit organization means a university or other institution of
higher education or an organization of the type described in section
501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and
exempt from taxation under section 501(a) of the Internal Revenue Code
(26 U.S.C. 501(a)), or any nonprofit scientific or educational
organization qualified under a State nonprofit organization statute.
Practical application means to manufacture, in the case of a
composition or product; to practice, in the case of a process or
method; or to operate, in the case of a machine or system; and, in each
case, under such conditions as to establish that the invention is being
utilized and that its benefits are, to the extent permitted by law or
Government regulations,
[[Page 31796]]
available to the public on reasonable terms.
Subject invention means any invention of the contractor made in the
performance of work under a Government contract; provided, that in the
case of a variety of plant, the date of determination defined in 7
U.S.C. 2401(d) must also occur during the period of contract
performance.
27.302 Policy.
(a) Introduction. In accordance with chapter 18 of title 35, U.S.C.
(as implemented by 37 CFR part 401), Presidential Memorandum on
Government Patent Policy to the Heads of Executive Departments and
Agencies dated February 18, 1983, and Executive Order 12591,
Facilitating Access to Science and Technology dated April 10, 1987, it
is the policy and objective of the Government to--
(1) Use the patent system to promote the use of inventions arising
from federally supported research or development;
(2) Encourage maximum participation of industry in federally
supported research and development efforts;
(3) Ensure that these inventions are used in a manner to promote
free competition and enterprise;
(4) Promote the commercialization and public availability of the
inventions made in the United States by United States industry and
labor;
(5) Ensure that the Government obtains sufficient rights in
federally supported inventions to meet the needs of the Government and
protect the public against nonuse or unreasonable use of inventions;
and
(6) Minimize the costs of administering patent policies.
(b) Contractor right to elect title. (1) Generally, pursuant to 35
U.S.C. 202 and the Presidential memorandum and Executive order cited in
paragraph (a) of this section, each contractor may, after required
disclosure to the Government, elect to retain title to any subject
invention.
(2) A contract may require the contractor to assign to the
Government title to any subject invention--
(i) When the contractor is not located in the United States or does
not have a place of business located in the United States or is subject
to the control of a foreign government (see 27.303(c));
(ii) In exceptional circumstances, when an agency determines that
restriction or elimination of the right to retain title in any subject
invention will better promote the policy and objectives of chapter 18
of title 35, U.S.C. and the Presidential memorandum;
(iii) When a Government authority, that is authorized by statute or
Executive order to conduct foreign intelligence or counterintelligence
activities, determines that the restriction or elimination of the right
to retain title to any subject invention is necessary to protect the
security of such activities;
(iv) When the contract includes the operation of a Government-
owned, contractor-operated facility of the Department of Energy (DoE)
primarily dedicated to the Department's naval nuclear propulsion or
weapons related programs and all funding agreement limitations under 35
U.S.C. 202(a)(iv) for agreements with small business concerns and
nonprofit organizations are limited to inventions occurring under the
above two programs; or
(v) Pursuant to statute or in accordance with agency regulations.
(3) When the Government has the right to acquire title to a subject
invention, the contractor may, nevertheless, request greater rights to
a subject invention (see 27.304-1(c)).
(4) Consistent with 37 CFR part 401, when a contract with a small
business concern or nonprofit organization requires assignment of title
to the Government based on the exceptional circumstances enumerated in
paragraph (b)(2)(ii) of this section for reasons of national security,
the contract shall still provide the contractor with the right to elect
ownership to any subject invention that--
(i) Is not classified by the agency; or
(ii) Is not limited from dissemination by the DoE within 6 months
from the date it is reported to the agency.
(5) Contracts in support of DoE's naval nuclear propulsion program
are exempted from this paragraph (b).
(6) When a contract involves a series of separate task orders, an
agency may apply the exceptions at paragraph (b)(2)(ii) or (iii) of
this section to individual task orders.
(c) Government license. The Government shall have at least a
nonexclusive, nontransferable, irrevocable, paid-up license to
practice, or have practiced for or on behalf of the United States, any
subject invention throughout the world. The Government may require
additional sublicense rights in order to comply with treaties or other
international agreements. In such case, the sublicense rights must be
made a part of the contract (see 27.303).
(d) Government right to receive title. (1) In addition to the right
to obtain title to subject inventions pursuant to paragraphs (b)(2)(i)
through (b)(2)(v) of this section, the Government has the right to
receive title to an invention--
(i) If the contractor has not disclosed the invention within the
time specified in the clause; or
(ii) In any country where the contractor--
(A) Does not elect to retain rights or fails to elect to retain
rights to the invention within the time specified in the clause;
(B) Has not filed a patent application within the time specified in
the clause;
(C) Decides not to continue prosecution of a patent application,
pay maintenance fees, or defend in a reexamination or opposition
proceeding on the patent; or
(D) No longer desires to retain title.
(2) For the purposes of this paragraph, filing in a European Patent
Office Region or under the Patent Cooperation Treaty constitutes
election in the countries selected in the application(s).
(e) Utilization reports. The Government has the right to require
periodic reporting on how any subject invention is being used by the
contractor or its licensees or assignees. In accordance with 35 U.S.C.
202(c)(5) and 37 CFR part 401, agencies shall not disclose such
utilization reports to persons outside the Government without
permission of the contractor. Contractors should mark as confidential/
proprietary any utilization report to help prevent inadvertent release
outside the Government.
(f) March-in rights. (1) Pursuant to 35 U.S.C. 203, agencies have
certain march-in rights that require the contractor, an assignee, or
exclusive licensee of a subject invention to grant a nonexclusive,
partially exclusive, or exclusive license in any field of use to
responsible applicants upon terms that are reasonable under the
circumstances. If the contractor, assignee or exclusive licensee of a
subject invention refuses to grant such a license, the agency can grant
the license itself. March-in rights may be exercised only if the agency
determines that this action is necessary--
(i) Because the contractor or assignee has not taken, or is not
expected to take within a reasonable time, effective steps to achieve
practical application of the subject invention in the field(s) of use;
(ii) To alleviate health or safety needs that are not reasonably
satisfied by the contractor, assignee, or their licensees;
(iii) To meet requirements for public use specified by Federal
regulations and these requirements are not reasonably satisfied by the
contractor, assignee, or licensees; or
(iv) Because the agreement required by paragraph (g) of this
section has neither been obtained nor waived, or because a licensee of
the exclusive right to use or sell any subject invention in the United
States is in breach of its
[[Page 31797]]
agreement obtained pursuant to paragraph (g) of this section.
(2) The agency shall not exercise its march-in rights unless the
contractor has been provided a reasonable time to present facts and
show cause why the proposed agency action should not be taken. The
agency shall provide the contractor an opportunity to dispute or appeal
the proposed action in accordance with 27.304-1(g).
(g) Preference for United States industry. Unless provided
otherwise in accordance with 27.304-1(f), contracts provide that no
contractor that receives title to any subject invention and no assignee
of the contractor shall grant to any person the exclusive right to use
or sell any subject invention in the United States unless that person
agrees that any products embodying the subject invention or produced
through the use of the subject invention will be manufactured
substantially in the United States (see 35 U.S.C. 204). However, in
individual cases, the requirement for this agreement may be waived by
the agency upon a showing by the contractor or assignee that reasonable
but unsuccessful efforts have been made to grant licenses on similar
terms to potential licensees that would be likely to manufacture
substantially in the United States or that under the circumstances
domestic manufacture is not commercially feasible.
(h) Special conditions for nonprofit organizations' preference for
small business concerns. (1) Nonprofit organization contractors are
expected to use reasonable efforts to attract small business licensees
(see paragraph (j)(4) of the clause at 52.227-11, Patent Rights--
Retention by the Contractor). What constitutes reasonable efforts to
attract small business licensees will vary with the circumstances and
the nature, duration, and expense of efforts needed to bring the
invention to the market.
(2) Small business concerns that believe a nonprofit organization
is not meeting its obligations under the clause may report the matter
to the Secretary of Commerce. To the extent deemed appropriate, the
Secretary of Commerce will undertake informal investigation of the
matter and may discuss or negotiate with the nonprofit organization
ways to improve its efforts to meet its obligations under the clause.
However, in no event will the Secretary of Commerce intervene in
ongoing negotiations or contractor decisions concerning the licensing
of a specific subject invention. These investigations, discussions, and
negotiations involving the Secretary of Commerce will be in
coordination with other interested agencies, including the Small
Business Administration. In the case of a contract for the operation of
a Government-owned, contractor-operated research or production
facility, the Secretary of Commerce will coordinate with the agency
responsible for the facility prior to any discussions or negotiations
with the contractor.
(i) Minimum rights to contractor. (1) When the Government acquires
title to a subject invention, the contractor is normally granted a
revocable, nonexclusive, paid-up license to that subject invention
throughout the world. The contractor's license extends to its domestic
subsidiaries and affiliates, if any, within the corporate structure of
which the contractor is a part and includes the right to grant
sublicenses to the extent the contractor was legally obligated to do so
at the time of contract award. The contracting officer shall approve
any transfer of the contractor's licenses except when the transfer is
to the successor of that part of the contractor's business to which the
subject invention pertains.
(2) In response to a third party's proper application for an
exclusive license, the contractor's domestic license may be revoked or
modified to the extent necessary to achieve expeditious practical
application of the subject invention. The application shall be
submitted in accordance with the applicable provisions in 37 CFR part
404 and agency licensing regulations. The contractor's license will not
be revoked in that field of use or the geographical areas in which the
contractor has achieved practical application and continues to make the
benefits of the subject invention reasonably accessible to the public.
The license in any foreign country may be revoked or modified to the
extent the contractor, its licensees, or its domestic subsidiaries or
affiliates have failed to achieve practical application in that
country. (See the procedures at 27.304-1(f).)
(j) Confidentiality of inventions. Publishing information
concerning an invention before a patent application is filed on a
subject invention may create a bar to a valid patent. To avoid this
bar, agencies may withhold information from the public that discloses
any invention in which the Federal Government owns or may own a right,
title, or interest (including a nonexclusive license) (see 35 U.S.C.
205 and 37 CFR part 401). Agencies may only withhold information
concerning inventions for a reasonable time in order for a patent
application to be filed. Once filed in any patent office, agencies are
not required to release copies of any document that is a part of a
patent application for those subject inventions.
27.303 Contract clauses.
(a)(1) Insert a patent rights clause in all solicitations and
contracts for experimental, developmental, or research work as
prescribed in this section.
(2) This section also applies to solicitations or contracts for
construction work or architect-engineer services that include--
(i) Experimental, developmental, or research work;
(ii) Test and evaluation studies; or
(iii) The design of a Government facility that may involve novel
structures, machines, products, materials, processes, or equipment
(including construction equipment).
(3) The contracting officer shall not include a patent rights
clause in solicitations or contracts for construction work or
architect-engineer services that call for or can be expected to involve
only ``standard types of construction.'' ``Standard types of
construction'' are those involving previously developed equipment,
methods, and processes and in which the distinctive features include
only--
(i) Variations in size, shape, or capacity of conventional
structures; or
(ii) Purely artistic or aesthetic (as distinguished from
functionally significant) architectural configurations and designs of
both structural and nonstructural members or groupings, whether or not
they qualify for design patent protection.
(b)(1) Unless an alternative patent rights clause is used in
accordance with paragraph (c), (d), or (e) of this section, insert the
clause at 52.227-11, Patent Rights--Ownership by the Contractor.
(2) To the extent the information is not required elsewhere in the
contract, and unless otherwise specified by agency supplemental
regulations, the contracting officer may modify 52.227-11(e) or
otherwise supplement the clause to require the contractor to do one or
more of the following:
(i) Provide periodic (but not more frequently than annually)
listings of all subject inventions required to be disclosed during the
period covered by the report.
(ii) Provide a report prior to the closeout of the contract listing
all subject inventions or stating that there were none.
(iii) Provide the filing date, serial number, title, patent number,
and issue date for any patent application filed on any subject
invention in any country or, upon request, copies of any patent
application so identified.
[[Page 31798]]
(iv) Furnish the Government an irrevocable power to inspect and
make copies of the patent application file when a Federal Government
employee is a co-inventor.
(3) Use the clause with its Alternate I if the Government must
grant a foreign government a sublicense in subject inventions pursuant
to a specified treaty or executive agreement. The contracting officer
may modify Alternate I, if the agency head determines, at contract
award, that it would be in the national interest to sublicense foreign
governments or international organizations pursuant to any existing or
future treaty or agreement. When necessary to effectuate a treaty or
agreement, Alternate I may be appropriately modified.
(4) Use the clause with its Alternate II in contracts that may be
affected by existing or future treaties or agreements.
(5) Use the clause with its Alternate III in contracts with
nonprofit organizations for the operation of a Government-owned
facility.
(6) If the contract is for the operation of a Government-owned
facility, the contracting officer may use the clause with its Alternate
IV.
(c) Insert a patent rights clause in accordance with the procedures
at 27.304-2 if the solicitation or contract is being placed on behalf
of another Government agency.
(d) Insert a patent rights clause in accordance with agency
procedures if the solicitation or contract is for DoD, DoE, or NASA,
and the contractor is other than a small business concern or nonprofit
organization.
(e)(1) Except as provided in paragraph (e)(2) of this section, and
after compliance with the applicable procedures in 27.304-1(b), the
contracting officer may insert the clause at 52.227-13, Patent Rights--
Ownership by the Government, or a clause prescribed by agency
supplemental regulations, if--
(i) The contractor is not located in the United States or does not
have a place of business located in the United States or is subject to
the control of a foreign government;
(ii) There are exceptional circumstances and the agency head
determines that restriction or elimination of the right to retain title
to any subject invention will better promote the policy and objectives
of chapter 18 of title 35 of the United States Code;
(iii) A Government authority that is authorized by statute or
Executive order to conduct foreign intelligence or counterintelligence
activities determines that restriction or elimination of the right to
retain any subject invention is necessary to protect the security of
such activities; or
(iv) The contract includes the operation of a Government-owned,
contractor-operated facility of the Department of Energy primarily
dedicated to that Department's naval nuclear propulsion or weapons
related programs.
(2) If an agency exercises the exceptions at paragraph (e)(1)(ii)
or (iii) of this section in a contract with a small business concern or
a nonprofit organization, the contracting officer shall use the clause
at 52.227-11 with only those modifications necessary to address the
exceptional circumstances and shall include in the modified clause
greater rights determinations procedures equivalent to those at 52.227-
13(b)(2).
(3) When using the clause at 52.227-13, Patent Rights--Ownership by
the Government, the contracting officer may supplement the clause to
require the contractor to--
(i) Furnish a copy of each subcontract containing a patent rights
clause (but if a copy of a subcontract is furnished under another
clause, a duplicate shall not be requested under the patent rights
clause);
(ii) Submit interim and final invention reports listing subject
inventions and notifying the contracting officer of all subcontracts
awarded for experimental, developmental, or research work;
(iii) Provide the filing date, serial number, title, patent number,
and issue date for any patent application filed on any subject
invention in any country or, upon specific request, copies of any
patent application so identified; and
(iv) Submit periodic reports on the utilization of a subject
invention.
(4) Use the clause at 52.227-13 with its Alternate I if--
(i) The Government must grant a foreign government a sublicense in
subject inventions pursuant to a treaty or executive agreement; or
(ii) The agency head determines, at contract award, that it would
be in the national interest to sublicense foreign governments or
international organizations pursuant to any existing or future treaty
or agreement. If other rights are necessary to effectuate any treaty or
agreement, Alternate I may be appropriately modified.
(5) Use the clause at 52.227-13 with its Alternate II in the
contract when necessary to effectuate an existing or future treaty or
agreement.
27.304 Procedures.
27.304-1 General.
(a) Status as small business concern or nonprofit organization. If
an agency has reason to question the size or nonprofit status of the
prospective contractor, the agency may require the prospective
contractor to furnish evidence of its status or file a protest in
accordance with 13 CFR 121.1005.
(b) Exceptions. (1) Before using any of the exceptions under
27.303(e)(1) in a contract with a small business concern or a nonprofit
organization and before using the exception of 27.303(e)(1)(ii) for any
contractor, the agency shall follow the applicable procedures at 37 CFR
part 401.
(2) A small business concern or nonprofit organization is entitled
to an administrative review of the use of the exceptions at
27.303(e)(1)(i) through (e)(1)(iv) pursuant to agency procedures and 37
CFR part 401.
(c) Greater rights determinations. Whenever the contract contains
the clause at 52.227-13, Patent Rights--Ownership by the Government, or
a patent rights clause modified pursuant to 27.303(e)(2), the
contractor (or an employee-inventor of the contractor after
consultation with the contractor) may request greater rights to an
identified invention within the period specified in the clause. The
contracting officer may grant requests for greater rights if the
contracting officer determines that the interests of the United States
and the general public will be better served.
In making these determinations, the contracting officer shall
consider at least the following objectives:
(1) Promoting the utilization of inventions arising from federally
supported research and development.
(2) Ensuring that inventions are used in a manner to promote full
and open competition and free enterprise.
(3) Promoting public availability of inventions made in the United
States by United States industry and labor.
(4) Ensuring that the Government obtains sufficient rights in
federally supported inventions to meet the needs of the Government and
protect the public against nonuse or unreasonable use of inventions.
(d) Retention of rights by inventor. If the contractor elects not
to retain title to a subject invention, the agency may consider and,
after consultation with the contractor, grant requests for retention of
rights by the inventor. Retention of rights by the inventor will be
subject to the conditions in paragraphs (d) (except paragraph
(d)(1)(i)), (e)(4), (g), (h), and
[[Page 31799]]
(i) of the clause at 52.227-11, Patent Rights--Ownership by the
Contractor.
(e) Government assignment to contractor of rights in Government
employees' inventions. When a Government employee is a co-inventor of
an invention made under a contract with a small business concern or
nonprofit organization, the agency employing the co-inventor may
transfer or assign whatever rights it may acquire in the subject
invention from its employee to the contractor, subject at least to the
conditions of 35 U.S.C. 202-204.
(f) Revocation or modification of contractor's minimum rights.
Before revoking or modifying the contractor's license in accordance
with 27.302(i)(2), the contracting officer shall furnish the contractor
a written notice of intention to revoke or modify the license. The
agency shall allow the contractor at least 30 days (or another time as
may be authorized for good cause by the contracting officer) after the
notice to show cause why the license should not be revoked or modified.
The contractor has the right to appeal, in accordance with applicable
regulations in 37 CFR part 404 and agency licensing regulations, any
decisions concerning the revocation or modification.
(g) Exercise of march-in rights. When exercising march-in rights,
agencies must follow the procedures set forth in 37 CFR 401.6.
(h) Licenses and assignments under contracts with nonprofit
organizations. If the contractor is a nonprofit organization, the
clause at 52.227-11 provides that certain contractor actions require
agency approval, as specified below. A contractor may not assign rights
to a subject invention in the United States without the written
approval of the agency, except when the assignment is made to an
organization that has as one of its primary functions the management of
inventions (provided that the assignee is subject to the same
provisions as the contractor).
27.304-2 Contracts placed by or for other Government agencies.
The following procedures apply unless an interagency agreement
provides otherwise:
(a) When a Government agency requests another Government agency to
award a contract on its behalf, the request should explain any special
circumstances surrounding the contract and specify the patent rights
clause to be used. The clause should be selected and modified, if
necessary, in accordance with the policies and procedures of this
subpart. If, however, the request states that a clause of the
requesting agency is required (e.g., because of statutory requirements,
a deviation, or exceptional circumstances), the awarding agency shall
use that clause rather than those of this subpart.
(1) If the request states that an agency clause is required and the
work to be performed under the contract is not severable and is funded
wholly or in part by the requesting agency, then include the requesting
agency clause and no other patent rights clause in the contract.
(2) If the request states that an agency clause is required, and
the work to be performed under the contract is severable, then the
contracting officer shall assure that the requesting agency clause
applies only to that severable portion of the work and that the work
for the awarding agency is subject to the appropriate patent rights
clause.
(3) If the request states that a requesting agency clause is not
required in any resulting contract, the awarding agency shall use the
appropriate patent rights clause, if any.
(b) Any action requiring an agency determination, report, or
deviation involved in the use of the requesting agency's clause is the
responsibility of the requesting agency unless the agencies agree
otherwise. However, the awarding agency may not alter the requesting
agency's clause without prior approval of the requesting agency.
(c) The requesting agency may require, and provide instructions
regarding, the forwarding or handling of any invention disclosures or
other reporting requirements of the specified clauses. Normally, the
requesting agency is responsible for the administration of any subject
inventions. This responsibility shall be established in advance of
awarding any contracts.
27.304-3 Subcontracts.
(a) The policies and procedures in this subpart apply to all
subcontracts at any tier.
(b) Whenever a prime contractor or a subcontractor considers
including a particular clause in a subcontract to be inappropriate or a
subcontractor refuses to accept the clause, the contracting officer, in
consultation with counsel, shall resolve the matter.
(c) It is Government policy that contractors shall not use their
ability to award subcontracts as economic leverage to acquire rights
for themselves in inventions resulting from subcontracts.
27.304-4 Appeals.
(a) The designated agency official shall provide the contractor
with a written statement of the basis, including any relevant facts,
for taking any of the following actions:
(1) A refusal to grant an extension to the invention disclosure
period under paragraph (c)(4) of the clause at 52.227-11.
(2) A demand for a conveyance of title to the Government under
27.302(d)(1)(i) and (ii).
(3) A refusal to grant a waiver under 27.302(g), Preference for
United States industry.
(4) A refusal to approve an assignment under 27.304-1(h).
(b) Each agency may establish and publish procedures under which
any of these actions may be appealed. These appeal procedures should
include administrative due process procedures and standards for fact-
finding. The resolution of any appeal shall consider both the factual
and legal basis for the action and its consistency with the policy and
objectives of 35 U.S.C. 200-206 and 210.
(c) To the extent that any of the actions described in paragraph
(a) of this section are subject to appeal under the Contract Disputes
Act, the procedures under that Act will satisfy the requirements of
paragraph (b).
27.305 Administration of patent rights clauses.
27.305-1 Goals.
(a) Contracts having a patent rights clause should be so
administered that--
(1) Inventions are identified, disclosed, and reported as required
by the contract, and elections are made;
(2) The rights of the Government in subject inventions are
established;
(3) When patent protection is appropriate, patent applications are
timely filed and prosecuted by contractors or by the Government;
(4) The rights of the Government in filed patent applications are
documented by formal instruments such as licenses or assignments; and
(5) Expeditious commercial utilization of subject inventions is
achieved.
(b) If a subject invention is made under a contract funded by more
than one agency, at the request of the contractor or on their own
initiative, the agencies shall designate one agency as responsible for
administration of the rights of the Government in the invention.
[[Page 31800]]
27.305-2 Administration by the Government.
(a) Agencies should establish and maintain appropriate follow-up
procedures to protect the Government's interest and to check that
subject inventions are identified and disclosed, and when appropriate,
patent applications are filed, and that the Government's rights therein
are established and protected. Follow-up activities for contracts that
include a clause referenced in 27.304-2 should be coordinated with the
appropriate agency.
(b)(1) The contracting officer administering the contract (or other
representative specifically designated in the contract for this
purpose) is responsible for receiving invention disclosures, reports,
confirmatory instruments, notices, requests, and other documents and
information submitted by the contractor pursuant to a patent rights
clause.
(i) For other than confirmatory instruments, if the contractor
fails to furnish documents or information as called for by the clause
within the time required, the contracting officer shall promptly
request the contractor to supply the required documents or information.
If the failure persists, the contracting officer shall take appropriate
action to secure compliance.
(ii) If the contractor does not furnish confirmatory instruments
within 6 months after filing each patent application, or within 6
months after submitting the invention disclosure if the application has
been previously filed, the contracting officer shall request the
contractor to supply the required documents.
(2) The contracting officer shall promptly furnish all invention
disclosures, reports, confirmatory instruments, notices, requests, and
other documents and information relating to patent rights clauses to
legal counsel.
(c) Contracting activities should establish appropriate procedures
to detect and correct failures by the contractor to comply with its
obligations under the patent rights clauses, such as failures to
disclose and report subject inventions, both during and after contract
performance. Government effort to review and correct contractor
compliance with its patent rights obligations should be directed
primarily toward contracts that are more likely to result in subject
inventions significant in number or quality. These contracts include
contracts of a research, developmental, or experimental nature;
contracts of a large dollar amount; and any other contracts when there
is reason to believe the contractor may not be complying with its
contractual obligations. Other contracts may be reviewed using a spot-
check method, as feasible. Appropriate follow-up procedures and
activities may include the investigation or review of selected
contracts or contractors by those qualified in patent and technical
matters to detect failures to comply with contract obligations.
(d) Follow-up activities should include, where appropriate, use of
Government patent personnel--
(1) To interview agency technical personnel to identify novel
developments made in contracts;
(2) To review technical reports submitted by contractors with
cognizant agency technical personnel;
(3) To check the Official Gazette of the United States Patent and
Trademark Office and other sources for patents issued to the contractor
in fields related to its Government contracts; and
(4) To have cognizant Government personnel interview contractor
personnel regarding work under the contract involved, observe the work
on site, and inspect laboratory notebooks and other records of the
contractor related to work under the contract.
(e) If a contractor or subcontractor does not have a clear
understanding of its obligations under the clause, or its procedures
for complying with the clause are deficient, the contracting officer
should explain to the contractor its obligations. The withholding of
payments provision (if any) of the patent rights clause may be invoked
if the contractor fails to meet the obligations required by the patents
rights clause. Significant or repeated failures by a contractor to
comply with the patent rights obligation in its contracts shall be
documented and made a part of the general file (see 4.801(c)(3)).
27.305-3 Securing invention rights acquired by the Government.
(a) Agencies are responsible for implementing procedures necessary
to protect the Government's interest in subject inventions. When the
Government acquires the entire right, title, and interest in an
invention by contract, the chain of title from the inventor to the
Government must be clearly established. This is normally accomplished
by an assignment either from each inventor to the contractor and from
the contractor to the Government, or from the inventor to the
Government with the consent of the contractor. When the Government's
rights are limited to a license, there should be a confirmatory
instrument to that effect.
(b) Agencies may, by supplemental instructions, develop suitable
assignments, licenses, and other papers evidencing any rights of the
Government in patents or patents applications. These instruments should
be recorded in the U.S. Patent and Trademark Office (see Executive
Order 9424, Establishing in the United States Patent Office a Register
of Government Interests in Patents and Applications for Patents
(February 18, 1944)).
27.305-4 Protection of invention disclosures.
(a) The Government will, to the extent authorized by 35 U.S.C. 205,
withhold from disclosure to the public any invention disclosures
reported under the patent rights clauses of 52.227-11 or 52.227-13 for
a reasonable time in order for patent applications to be filed. The
Government will follow the policy in 27.302(j) regarding protection of
confidentiality.
(b) The Government should also use reasonable efforts to withhold
from disclosure to the public for a reasonable time other information
disclosing a subject invention. This information includes any data
delivered pursuant to contract requirements provided that the
contractor notifies the agency as to the identity of the data and the
subject invention to which it relates at the time of delivery of the
data. This notification shall be provided to both the contracting
officer and to any patent representative to which the invention is
reported, if other than the contracting officer.
27.306 Licensing background patent rights to third parties.
(a) A contract with a small business concern or nonprofit
organization shall not contain a provision allowing the Government to
require the licensing to third parties of inventions owned by the
contractor that are not subject inventions unless the agency head has
approved and signed a written justification in accordance with
paragraph (b) of this section. The agency head may not delegate this
authority and may exercise the authority only if it is determined that
the--
(1) Use of the invention by others is necessary for the practice of
a subject invention or for the use of a work object of the contract;
and
(2) Action is necessary to achieve the practical application of the
subject invention or work object.
(b) Any determination will be on the record after an opportunity
for a hearing, and the agency shall notify the contractor of the
determination by certified or registered mail. The notification shall
include a statement
[[Page 31801]]
that the contractor must bring any action for judicial review of the
determination within 60 days after the notification.
Subpart 27.4--Rights in Data and Copyrights
27.400 Scope of subpart.
This subpart sets forth policies and procedures regarding rights in
data and copyrights, and acquisition of data. The policy statement in
27.402 applies to all executive agencies. The remainder of the subpart
applies to all executive agencies except the Department of Defense.
27.401 Definitions.
As used in this subpart--
Computer data base means a collection of data in a form capable of,
and for the purpose of, being stored in, processed, and operated on by
a computer. The term does not include computer software.
Computer software means--
(1) Computer programs that comprise a series of instructions,
rules, routines, or statements, regardless of the media in which
recorded, that allow or cause a computer to perform a specific
operation or series of operations; and
(2) Recorded information comprising source code listings, design
details, algorithms, processes, flow charts, formulas, and related
material that would enable the computer program to be produced,
created, or compiled. The term does not include computer data bases or
computer software documentation.
Data means recorded information, regardless of form or the media on
which it may be recorded. The term includes technical data and computer
software. The term does not include information incidental to contract
administration, such as financial, administrative, cost or pricing, or
management information.
Form, fit, and function data means data relating to items,
components, or processes that are sufficient to enable physical and
functional interchangeability, and data identifying source, size,
configuration, mating and attachment characteristics, functional
characteristics, and performance requirements. For computer software it
means data identifying source, functional characteristics, and
performance requirements, but specifically excludes the source code,
algorithm, process, formulas, and flow charts of the software.
Limited rights means the rights of the Government in limited rights
data as set forth in a Limited Rights Notice.
Limited rights data means data, other than computer software, that
embody trade secrets or are commercial or financial and confidential or
privileged, to the extent that such data pertain to items, components,
or processes developed at private expense, including minor
modifications. Agencies may, however, adopt the following alternate
definition: Limited rights data means data (other than computer
software) developed at private expense that embody trade secrets or are
commercial or financial and confidential or privileged (see 27.404-
2(b)).
Restricted computer software means computer software developed at
private expense and that is a trade secret, is commercial or financial
and confidential or privileged, or is copyrighted computer software,
including minor modifications of the computer software.
Restricted rights means the rights of the Government in restricted
computer software as set forth in a Restricted Rights Notice.
Technical data means recorded information (regardless of the form
or method of the recording) of a scientific or technical nature
(including computer data bases and computer software documentation)
relating to supplies procured by an agency. This term does not include
computer software or financial, administrative, cost or pricing, or
management data or other information incidental to contract
administration. Recorded information of a scientific or technical
nature that is included in computer data bases is also technical data
(41 U.S.C. 403(8)).
Unlimited rights means the rights of the Government to use,
disclose, reproduce, prepare derivative works, distribute copies to the
public, and perform publicly and display publicly, in any manner and
for any purpose, and to have or permit others to do so.
27.402 Policy.
(a) To carry out their missions and programs, agencies acquire or
obtain access to many kinds of data produced during or used in the
performance of their contracts. Agencies require data to--
(1) Obtain competition among suppliers;
(2) Fulfill certain responsibilities for disseminating and
publishing the results of their activities;
(3) Ensure appropriate utilization of the results of research,
development, and demonstration activities, including the dissemination
of technical information to foster subsequent technological
developments;
(4) Meet other programmatic and statutory requirements; and
(5) Meet specialized acquisition needs and ensure logistics
support.
(b) Contractors may have proprietary interests in data. In order to
prevent the compromise of these interests, agencies must protect
proprietary data from unauthorized use and disclosure. The protection
of such data is also necessary to encourage qualified contractors to
participate in and apply innovative concepts to Government programs. In
light of these considerations, agencies must balance the Government's
needs and the contractor's legitimate proprietary interests.
27.403 Data rights--General.
All contracts that require data to be produced, furnished,
acquired, or used in meeting contract performance requirements must
contain terms that delineate the respective rights and obligations of
the Government and the contractor regarding the use, reproduction, and
disclosure of that data. Data rights clauses do not specify the type,
quantity or quality of data that is to be delivered, but only the
respective rights of the Government and the contractor regarding the
use, disclosure, or reproduction of the data. Accordingly, the contract
shall specify the data to be delivered.
27.404 Basic rights in data clause.
This section describes the operation of the clause at 52.227-14,
Rights in Data--General, and also the use of the provision at 52.227-
15, Representation of Limited Rights Data and Restricted Computer
software.
27.404-1 Unlimited rights data.
The Government acquires unlimited rights in the following data
(except for copyrighted works as provided in 27.404-3):
(a) Data first produced in the performance of a contract (except to
the extent the data constitute minor modifications to data that are
limited rights data or restricted computer software).
(b) Form, fit, and function data delivered under contract.
(c) Data (except as may be included with restricted computer
software) that constitute manuals or instructional and training
material for installation, operation, or routine maintenance and repair
of items, components, or processes delivered or furnished for use under
a contract.
(d) All other data delivered under the contract other than limited
rights data or restricted computer software (see 27.404-2).
[[Page 31802]]
27.404-2 Limited rights data and restricted computer software.
(a) General. The basic clause at 52.227-14, Rights in Data--
General, enables the contractor to protect qualifying limited rights
data and restricted computer software by withholding the data from the
Government and instead delivering form, fit, and function data.
(b) Alternate definition of limited rights data. For contracts that
do not require the development, use, or delivery of items, components,
or processes that are intended to be acquired by or for the Government,
an agency may adopt the alternate definition of limited rights data set
forth in Alternate I to the clause at 52.227-14. The alternate
definition does not require that the data pertain to items, components,
or processes developed at private expense; but rather that the data
were developed at private expense and embody a trade secret or are
commercial or financial and confidential or privileged.
(c) Protection of limited rights data specified for delivery. (1)
The clause at 52.227-14 with its Alternate II enables the Government to
require delivery of limited rights data rather than allow the
contractor to withhold the data. To obtain delivery, the contract may
identify and specify data to be delivered, or the contracting officer
may require, by written request during contract performance, the
delivery of data that has been withheld or identified to be withheld
under paragraph (g)(1) of the clause. In addition, the contract may
specifically identify data that are not to be delivered under Alternate
II or which, if delivered, will be delivered with limited rights. The
limited rights obtained by the Government are set forth in the Limited
Rights Notice contained in paragraph (g)(3) of Alternate II of the
clause. Agencies shall not, without permission of the contractor, use
limited rights data for purposes of manufacture or disclose the data
outside the Government except as set forth in the Notice. Any
disclosure by the Government shall be subject to prohibition against
further use and disclosure by the recipient. The following are examples
of specific purposes that may be adopted by an agency in its supplement
and added to the Limited Rights Notice of paragraph (g)(3) of Alternate
II of the clause:
(i) Use (except for manufacture) by support service contractors.
(ii) Evaluation by nongovernment evaluators.
(iii) Use (except for manufacture) by other contractors
participating in the Government's program of which the specific
contract is a part.
(iv) Emergency repair or overhaul work.
(v) Release to a foreign government, or its instrumentalities, if
required to serve the interests of the U.S. Government, for information
or evaluation, or for emergency repair or overhaul work by the foreign
government.
(2) The provision at 52.227-15, Representation of Limited Rights
Data and Restricted Computer Software, helps the contracting officer to
determine whether the clause at 52.227-14 should be used with its
Alternate II. This provision requests that an offeror state whether
limited rights data are likely to be delivered. Where limited rights
data are expected to be delivered, Alternate II shall be used. Where
negotiations are based on an unsolicited proposal, the need for
Alternate II of the clause at 52.227-14 should be addressed during
negotiations or discussions, and if Alternate II was not included
initially, it may be added by modification, if needed, during contract
performance.
(3) If data that would otherwise qualify as limited rights data is
delivered as a computer data base, the data shall be treated as limited
rights data, rather than restricted computer software, for the purposes
of paragraph (g) of the clause at 52.227-14.
(d) Protection of restricted computer software specified for
delivery. (1) Alternate III of the clause at 52.227-14 enables the
Government to require delivery of restricted computer software rather
than allow the contractor to withhold such restricted computer
software. To obtain delivery of restricted computer software, the
contracting officer shall--
(i) Identify and specify the deliverable computer software in the
contract; or
(ii) Require by written request during contract performance, the
delivery of computer software that has been withheld or identified to
be withheld under paragraph (g)(1) of the clause.
(2) In considering whether to use Alternate III, contracting
officers should note that, unlike other data, computer software is also
an end item in itself. Thus, the contracting officer shall use
Alternate III if delivery of restricted computer software is required
to meet agency needs.
(3) Unless otherwise agreed (see paragraph (d)(4) of this
subsection), the restricted rights obtained by the Government are set
forth in the Restricted Rights Notice contained in paragraph (g)(4) of
Alternate III of the clause at 52.227-14. Such restricted computer
software will not be used or reproduced by the Government, or disclosed
outside the Government, except that the computer software may be--
(i) Used or copied for use in or with the computer or computers for
which it was acquired, including use at any Government installation to
which such computer or computers may be transferred;
(ii) Used or copied for use in or with a backup computer if any
computer for which it was acquired becomes inoperative;
(iii) Reproduced for safekeeping (archives) or backup purposes;
(iv) Modified, adapted, or combined with other computer software,
provided that the modified, combined, or adapted portions of any
derivative software incorporating restricted computer software are made
subject to the same restricted rights;
(v) Disclosed to and reproduced for use by support service
contractors, subject to the same restriction under which the Government
acquired the software;
(vi) Used or copied for use in or transferred to a replacement
computer; and
(vii) Used in accordance with paragraphs (d)(3)(i) through (v) of
this subsection, without disclosure prohibitions, if the computer
software is copyrighted computer software.
(4) The restricted rights set forth in paragraph (d)(3) of this
section are the minimum rights the Government normally obtains with
restricted computer software and will automatically apply when such
software is acquired under the Restricted Rights Notice of paragraph
(g)(4) of Alternate III of the clause at 52.227-14. However, the
contracting officer may specify different rights in the contract,
consistent with the purposes and needs for which the software is to be
acquired. For example, the contracting officer should consider any
networking needs or any requirements for use of the computer software
from remote terminals. Also, in addressing such needs, the scope of the
restricted rights may be different for the documentation accompanying
the computer software than for the programs and data bases. Any
additions to, or limitations on, the restricted rights set forth in the
Restricted Rights Notice of paragraph (g)(4) of Alternate III of the
clause at 52.227-14 shall be expressly stated in the contract or in a
collateral agreement incorporated in and made part of the contract, and
the notice modified accordingly.
(5) The provision at 52.227-15, Representation of Limited Rights
Data and Restricted Computer Software,
[[Page 31803]]
helps the contracting officer determine whether to use the clause at
52.227-14 with its Alternate III. This provision requests that an
offeror state whether restricted computer software is likely to be
delivered under the contract. In addition, the need for Alternate III
should be addressed during negotiations or discussions with an offeror,
particularly where negotiations are based on an unsolicited proposal.
However, if Alternate III is not used initially, it may be added by
modification, if needed, during contract performance.
27.404-3 Copyrighted works.
(a) Data first produced in the performance of a contract. (1)
Generally, the contractor must obtain permission of the contracting
officer prior to asserting rights in any copyrighted work containing
data first produced in the performance of a contract. However,
contractors are normally authorized, without prior approval of the
contracting officer, to assert copyright in technical or scientific
articles based on or containing such data that is published in
academic, technical or professional journals, symposia proceedings and
similar works.
(2) The contractor must make a written request for permission to
assert its copyright in works containing data first produced under the
contract. In its request, the contractor should identify the data
involved or furnish copies of the data for which permission is
requested, as well as a statement as to the intended publication or
dissemination media or other purpose for which the permission is
requested. Generally, a contracting officer should grant the
contractor's request when copyright protection will enhance the
appropriate dissemination or use of the data unless the--
(i) Data consist of a report that represents the official views of
the agency or that the agency is required by statute to prepare;
(ii) Data are intended primarily for internal use by the
Government;
(iii) Data are of the type that the agency itself distributes to
the public under an agency program;
(iv) Government determines that limitation on distribution of the
data is in the national interest; or
(v) Government determines that the data should be disseminated
without restriction.
(3) Alternate IV of the clause at 52.227-14 provides a substitute
paragraph (c)(1) granting permission for contractors to assert
copyright in any data first produced in the performance of the contract
without the need for any further requests. Except for contracts for
management or operation of Government facilities and contracts and
subcontracts in support of programs being conducted at those facilities
or where international agreements require otherwise, Alternate IV shall
be used in all contracts for basic or applied research to be performed
solely by colleges and universities. Alternate IV shall not be used in
contracts with colleges and universities if a purpose of the contract
is for development of computer software for distribution to the public
(including use in solicitations) by or on behalf of the Government. In
addition, Alternate IV may be used in other contracts if an agency
determines that it is not necessary for a contractor to request further
permission to assert copyright in data first produced in performance of
the contract. The contracting officer may exclude any data, or items or
categories of data, from the provisions of Alternate IV by expressly so
providing in the contract or by adding a paragraph (d)(3) to the
clause, consistent with 27.404-4(b).
(4) Pursuant to paragraph (c)(1) of the clause at 52.227-14, the
contractor grants the Government a paid-up, nonexclusive, irrevocable,
worldwide license to reproduce, prepare derivative works, distribute to
the public, perform publicly and display publicly by or on behalf of
the Government, for all data (other than computer software) first
produced in the performance of a contract. For computer software, the
scope of the Government's license includes all of the above rights
except the right to distribute to the public. Agencies may also obtain
a license of different scope if the contracting officer determines,
after consulting with legal counsel, such a license will substantially
enhance the dissemination of any data first produced under the contract
or if such a license is required to comply with international
agreements. If an agency obtains a different license, the contractor
must clearly state the scope of that license in a conspicuous place on
the medium on which the data is recorded. For example, if the data is
delivered as a report, the terms of the license shall be stated on the
cover, or first page, of the report.
(5) The clause requires the contractor to affix the applicable
copyright notices of 17 U.S.C. 401 or 402, and acknowledgment of
Government sponsorship (including the contract number), to data when it
asserts copyright in data. Failure to do so could result in such data
being treated as unlimited rights data (see 27.404-5(b)).
(b) Data not first produced in the performance of a contract. (1)
Contractors must not deliver any data that is not first produced under
the contract without either--
(i) Acquiring for or granting to the Government a copyright license
for the data; or
(ii) Obtaining permission from the contracting officer to do
otherwise.
(2) The copyright license the Government acquires for such data
will normally be of the same scope as discussed in paragraph (a)(4) of
this subsection, and is set forth in paragraph (c)(2) of the clause at
52.227-14. However, agencies may obtain a license of different scope if
the agency determines, after consultation with its legal counsel, that
such different license will not be inconsistent with the purpose of
acquiring the data. If a license of a different scope is acquired, it
must be so stated in the contract and clearly set forth in a
conspicuous place on the data when delivered to the Government. If the
contractor delivers computer software not first produced under the
contract, the contractor must grant the Government the license set
forth in paragraph (g)(4) of Alternate III if included in the clause at
52.227-14, or a license agreed to in a collateral agreement made part
of the contract.
27.404-4 Contractor's release, publication, and use of data.
(a) In contracts for basic or applied research with universities or
colleges, agencies shall not place any restrictions on the conduct of
or reporting on the results of unclassified basic or applied research,
except as provided in applicable U.S. Statutes. However, agencies may
restrict the release or disclosure of computer software that is or is
intended to be developed to the point of practical application
(including for agency distribution under established programs). This is
not considered a restriction on the reporting of the results of basic
or applied research. Agencies may also preclude a contractor from
asserting copyright in any computer software for purposes of
established agency distribution programs, or where required to
accomplish the purpose for which the software is acquired.
(b) Except for the results of basic or applied research under
contracts with universities or colleges, agencies may, to the extent
provided in their FAR supplements, place limitations or restrictions on
the contractor's exercise of its rights in data first produced in the
performance of the contract, including a requirement to assign
copyright to the Government or another party. Any of
[[Page 31804]]
these restrictions shall be expressly included in the contract.
27.404-5 Unauthorized, omitted, or incorrect markings.
(a) Unauthorized marking of data. (1) The Government has, in
accordance with paragraph (e) of the clause at 52.227-14, the right to
either return data containing unauthorized markings or to cancel or
ignore the markings.
(2) Agencies shall not cancel or ignore markings without making
written inquiry of the contractor and affording the contractor at least
30 days to provide a written justification substantiating the propriety
of the markings.
(i) If the contractor fails to respond or fails to provide a
written justification substantiating the propriety of the markings
within the time afforded, the Government may cancel or ignore the
markings.
(ii) If the contractor provides a written justification
substantiating the propriety of the markings, the contracting officer
shall consider the justification.
(A) If the contracting officer determines that the markings are
authorized, the contractor will be so notified in writing.
(B) If the contracting officer determines, with concurrence of the
head of the contracting activity, that the markings are not authorized,
the contractor will be furnished a written determination which becomes
the final agency decision regarding the appropriateness of the
markings, and the markings will be cancelled or ignored and the data
will no longer be made subject to disclosure prohibitions, unless the
contractor files suit within 90 days in a court of competent
jurisdiction. The markings will not be cancelled or ignored until final
resolution of the matter, either by the contracting officer's
determination becoming the final agency decision or by final
disposition of the matter by court decision if suit is filed.
(3) The foregoing procedures may be modified in accordance with
agency regulations implementing the Freedom of Information Act (5
U.S.C. 552) if necessary to respond to a request. In addition, the
contractor may bring a claim, in accordance with the Disputes clause of
the contract, that may arise as the result of the Government's action
to remove or ignore any markings on data, unless the action occurs as
the result of a final disposition of the matter by a court of competent
jurisdiction.
(b) Omitted or incorrect notices. (1) Data delivered under a
contract containing the clause without a limited rights notice or
restricted rights notice, and without a copyright notice, will be
presumed to have been delivered with unlimited rights, and the
Government assumes no liability for the disclosure, use, or
reproduction of the data. However, to the extent the data has not been
disclosed without restriction outside the Government, the contractor
may, within 6 months (or a longer period approved by the contracting
officer for good cause shown), request permission of the contracting
officer to have omitted limited rights or restricted rights notices, as
applicable, placed on qualifying data at the contractor's expense. The
contracting officer may permit adding appropriate notices if the
contractor--
(i) Identifies the data for which a notice is to be added;
(ii) Demonstrates that the omission of the proposed notice was
inadvertent;
(iii) Establishes that use of the proposed notice is authorized;
and
(iv) Acknowledges that the Government has no liability with respect
to any disclosure or use of any such data made prior to the addition of
the notice or resulting from the omission of the notice.
(2) The contracting officer may also--
(i) Permit correction, at the contractor's expense, of incorrect
notices if the contractor identifies the data on which correction of
the notice is to be made, and demonstrates that the correct notice is
authorized; or
(ii) Correct any incorrect notices.
27.404-6 Inspection of data at the contractor's facility.
Contracting officers may obtain the right to inspect data at the
contractor's facility by use of the clause at 52.227-14 with its
Alternate V, which adds paragraph (j) to provide that right. Agencies
may also adopt Alternate V for general use. The data subject to
inspection may be data withheld or withholdable under paragraph (g)(1)
of the clause. Inspection may be made by the contracting officer or
designee (including nongovernmental personnel under the same conditions
as the contracting officer) for the purpose of verifying a contractor's
assertion regarding the limited rights or restricted rights status of
the data, or for evaluating work performance under the contract. This
right may be exercised up to 3 years after acceptance of all items to
be delivered under the contract. The contract may specify data items
that are not subject to inspection under paragraph (j) of Alternate V.
If the contractor demonstrates to the contracting officer that there
would be a possible conflict of interest if inspection were made by a
particular representative, the contracting officer shall designate an
alternate representative.
27.405 Other data rights provisions.
27.405-1 Special works.
(a) The clause at 52.227-17, Rights in Data--Special Works, is for
use in contracts (or may be made applicable to portions thereof) that
are primarily for the production or compilation of data (other than
limited rights data or restricted computer software) for the
Government's own use, or when there is a specific need to limit
distribution and use of the data or to obtain indemnity for liabilities
that may arise out of the content, performance, or disclosure of the
data. Examples are contracts for--
(1) The production of audiovisual works, including motion pictures
or television recordings with or without accompanying sound, or for the
preparation of motion picture scripts, musical compositions, sound
tracks, translation, adaptation, and the like;
(2) Histories of the respective agencies, departments, services, or
units thereof;
(3) Surveys of Government establishments;
(4) Works pertaining to the instruction or guidance of Government
officers and employees in the discharge of their official duties;
(5) The compilation of reports, books, studies, surveys, or similar
documents that do not involve research, development, or experimental
work;
(6) The collection of data containing personally identifiable
information such that the disclosure thereof would violate the right of
privacy or publicity of the individual to whom the information relates;
(7) Investigatory reports;
(8) The development, accumulation, or compilation of data (other
than that resulting from research, development, or experimental work
performed by the contractor), the early release of which could
prejudice follow-on acquisition activities or agency regulatory or
enforcement activities; or
(9) The development of computer software programs, where the
program--
(i) May give a commercial advantage; or
(ii) Is agency mission sensitive, and release could prejudice
agency mission, programs, or follow-on acquisitions.
(b) The contract may specify the purposes and conditions (including
time limitations) under which the data may be used, released, or
reproduced other than for contract performance. Contracts for the
production of audiovisual works, sound recordings, etc., may include
limitations in
[[Page 31805]]
connection with talent releases, music licenses, and the like that are
consistent with the purposes for which the works are acquired.
(c) Paragraph (c)(1)(ii) of the clause, which enables the
Government to obtain assignment of copyright in any data first produced
in the performance of the contract, may be deleted if the contracting
officer determines that such assignment is not needed to further the
objectives of the contract.
(d) Paragraph (e) of the clause, which requires the contractor to
indemnify the Government against any liability incurred as the result
of any violation of trade secrets, copyrights, right of privacy or
publicity, or any libelous or other unlawful matter arising out of or
contained in any production or compilation of data that are subject to
the clause, may be deleted or limited in scope where the contracting
officer determines that, because of the nature of the particular data
involved, such liability will not arise.
(e) When the audiovisual or other special works are produced to
accomplish a public purpose other than acquisition for the Government's
own use (such as for production and distribution to the public of the
works by other than a Federal agency), agencies are authorized to
modify the clause for use in contracts, with rights in data provisions
that meet agency mission needs yet protect free speech and freedom of
expression, as well as the artistic license of the creator of the work.
27.405-2 Existing works.
The clause at 52.227-18, Rights in Data--Existing Works, is for use
in contracts exclusively for the acquisition (without modification) of
existing works such as motion pictures, television recordings, and
other audiovisual works; sound recordings; musical, dramatic, and
literary works; pantomimes and choreographic works; pictorial, graphic,
and sculptural works; and works of a similar nature. The contract may
set forth limitations consistent with the purposes for which the works
covered by the contract are being acquired. Examples of these
limitations are means of exhibition or transmission, time, type of
audience, and geographical location. However, if the contract requires
that works of the type indicated in this paragraph are to be modified
through editing, translation, or addition of subject matter, etc.
(rather than purchased in existing form), then see 27.405-1.
27.405-3 Commercial computer software.
(a)(1) When contracting other than from GSA's Multiple Award
Schedule contracts for the acquisition of commercial computer software,
no specific contract clause prescribed in this subpart need be used,
but the contract shall specifically address the Government's rights to
use, disclose, modify, distribute, and reproduce the software. Section
12.212 sets forth the guidance for the acquisition of commercial
computer software and states that commercial computer software or
commercial computer software documentation shall be acquired under
licenses customarily provided to the public to the extent the license
is consistent with Federal law and otherwise satisfies the Government's
needs. The clause at 52.227-19 may be used when there is any confusion
as to whether the Government's needs are satisfied or whether a
customary commercial license is consistent with Federal law. Additional
or lesser rights may be negotiated using the guidance concerning
restricted rights as set forth in 27.404-2(d), or the clause at 52.227-
19, Commercial Computer Software License. If greater rights than the
minimum rights identified in the clause at 52.227-19 are needed, or
lesser rights are to be acquired, they must be negotiated and set forth
in the contract. This includes any additions to, or limitations on, the
rights set forth in paragraph (b) of the clause at 52.227-19 when used.
Examples of greater rights may be those necessary for networking
purposes or use of the software from remote terminals communicating
with a host computer where the software is located. If the computer
software is to be acquired with unlimited rights, the contract must
also so state. In addition, the contract must adequately describe the
computer programs and/or data bases, the media on which it is recorded,
and all the necessary documentation.
(2) If the contract incorporates, makes reference to, or uses a
vendor's standard commercial lease, license, or purchase agreement, the
contracting officer shall ensure that the agreement is consistent with
paragraph (a)(1) of this subsection. The contracting officer should
exercise caution in accepting a vendor's terms and conditions, since
they may be directed to commercial sales and may not be appropriate for
Government contracts. Any inconsistencies in a vendor's standard
commercial agreement shall be addressed in the contract and the
contract terms shall take precedence over the vendor's standard
commercial agreement. If the clause at 52.227-19 is used,
inconsistencies in the vendor's standard commercial agreement regarding
the Government's right to use, reproduce or disclose the computer
software are reconciled by that clause.
(3) If a prime contractor under a contract containing the clause at
52.227-14, Rights in Data--General, with paragraph (g)(4) of Alternate
III in the clause, acquires restricted computer software from a
subcontractor (at any tier) as a separate acquisition for delivery to
or for use on behalf of the Government, the contracting officer may
approve any additions to, or limitations on, the restricted rights in
the Restricted Rights Notice of paragraph (g)(4) in a collateral
agreement incorporated in and made part of the contract.
(b)(1) Except for existing works pursuant to 27.405-2 or commercial
computer software pursuant to 27.405-3, no clause contained in this
subpart is required to be included in--
(i) Contracts solely for the acquisition of books, periodicals, and
other printed items in the exact form in which these items are to be
obtained unless reproduction rights are to be acquired; or
(ii) Other contracts that require only existing data (other than
limited rights data) to be delivered and the data are available without
disclosure prohibitions, unless reproduction rights to the data are to
be obtained.
(2) If the reproduction rights to the data are to be obtained in
any contract of the type described in paragraph (b)(1)(i) or (ii) of
this section, the rights shall be specifically set forth in the
contract. No clause contained in this subpart is required to be
included in contracts substantially for on-line database services in
the same form as they are normally available to the general public.
27.406 Acquisition of data.
27.406-1 General.
(a) It is the Government's practice to determine, to the extent
feasible, its data requirements in time for inclusion in solicitations.
The data requirements may be subject to revision during contract
negotiations. Since the preparation, reformatting, maintenance and
updating, cataloging, and storage of data represents an expense to both
the Government and the contractor, efforts should be made to keep the
contract data requirements to a minimum, consistent with the purposes
of the contract.
(b) The contracting officer shall specify in the contract all known
data
[[Page 31806]]
requirements, including the time and place for delivery and any
limitations and restrictions to be imposed on the contractor in the
handling of the data. Further, and to the extent feasible, in major
system acquisitions, the contracting officer shall set out data
requirements as separate contract line items. In establishing the
contract data requirements and in specifying data items to be delivered
by a contractor, agencies may, consistent with paragraph (a) of this
subsection, develop their own contract schedule provisions. Agency
procedures may, among other things, provide for listing, specifying,
identifying source, assuring delivery, and handling any data required
to be delivered, first produced, or specifically used in the
performance of the contract.
(c) Data delivery requirements should normally not require that a
contractor provide the Government, as a condition of the procurement,
unlimited rights in data that qualify as limited rights data or
restricted computer software. Rather, form, fit, and function data may
be furnished with unlimited rights instead of the qualifying data, or
the qualifying data may be furnished with limited rights or restricted
rights if needed (see 27.404-2(c) and (d)). If greater rights are
needed, they should be clearly set forth in the solicitation and the
contractor fairly compensated for the greater rights.
27.406-2 Additional data requirements.
(a) In some contracting situations, such as experimental,
developmental, research, or demonstration contracts, it may not be
feasible to ascertain all the data requirements at contract award. The
clause at 52.227-16, Additional Data Requirements, may be used to
enable the subsequent ordering by the contracting officer of additional
data first produced or specifically used in the performance of these
contracts as the actual requirements become known. The clause shall
normally be used in solicitations and contracts involving experimental,
developmental, research or demonstration work (other than basic or
applied research to be performed under a contract solely by a
university or college when the contract amount will be $500,000 or
less) unless all the requirements for data are believed to be known at
the time of contracting and specified in the contract. If the contract
is for basic or applied research to be performed by a university or
college, and the contracting officer believes the contract effort will
in the future exceed $500,000, even though the initial award does not,
the contracting officer may include the clause in the initial award.
(b) Data may be ordered under the clause at 52.227-16 at any time
during contract performance or within a period of 3 years after
acceptance of all items to be delivered under the contract. The
contractor is to be compensated for converting the data into the
prescribed form, for reproduction, and for delivery. In order to
minimize storage costs for the retention of data, the contracting
officer may relieve the contractor of the retention requirements for
specified data items at any time during the retention period required
by the clause. The contracting officer may permit the contractor to
identify and specify in the contract data not to be ordered for
delivery under the clause if the data is not necessary to meet the
Government's requirements for data. Also, the contracting officer may
alter the clause by deleting the term ``or specifically used'' in
paragraph (a) of the clause if delivery of the data is not necessary to
meet the Government's requirements for data. Any data ordered under
this clause will be subject to the clause at 52.227-14, Rights in
Data--General (or other equivalent clause setting forth the respective
rights of the Government and the contractor), in the contract. Data
authorized to be withheld under such clause will not be required to be
delivered under the clause at 52.227-16, except as provided in
Alternate II or Alternate III, if included (see 27.404-2(c) and (d)).
(c) Absent an established program for dissemination of computer
software, agencies should not order additional computer software under
the clause at 52.227-16 for the sole purpose of disseminating or
marketing the software to the public. In ordering software for internal
purposes, the contracting officer shall consider, consistent with the
Government's needs, not ordering particular source codes, algorithms,
processes, formulas or flow charts of the software if the contractor
shows that this aids its efforts to disseminate or market the software.
27.406-3 Major system acquisition.
(a) The clause at 52.227-21, Technical Data Declaration, Revision,
and Withholding of Payment--Major Systems, implements 41 U.S.C.
418a(d). When using the clause at 52.227-21, the section of the
contract specifying data delivery requirements (see 27.406-1(b)) shall
expressly identify those line items of technical data to which the
clause applies. Upon delivery of the technical data, the contracting
officer shall review the technical data and the contractor's
declaration relating to it to assure that the data are complete,
accurate, and comply with contract requirements. If the data are not
complete, accurate, or compliant, the contracting officer should
request the contractor to correct the deficiencies, and may withhold
payment. Final payment shall not be made under the contract until it
has been determined that the delivery requirements of those line items
of data to which the clause applies have been satisfactorily met.
(b) In a contract for, or in support of, a major system awarded by
a civilian agency other than NASA or the U.S. Coast Guard, the
following applies:
(1) The contracting officer shall require the delivery of any
technical data relating to the major system, or supplies for the major
system, that are to be developed exclusively with Federal funds if the
delivery of the technical data is needed to ensure the competitive
acquisition of supplies or services that will be required in
substantial quantities in the future. The clause at 52.227-22, Major
System--Minimum Rights, is used in addition to the clause at 52.227-14,
Rights in Data--General, and other required clauses, to ensure that the
Government acquires at least those rights required by Public Law 98-577
in technical data developed exclusively with Federal funds.
(2) Technical data, relating to a major system or supplies for a
major system, procured or to be procured by the Government and also
relating to the design, development, or manufacture of products or
processes offered or to be offered for sale to the public (except for
such data as may be necessary for the Government to operate or maintain
the product, or use the process if obtained by the Government as an
element of performance under the contract), shall not be required to be
provided to the Government from persons who have developed such
products or processes as a condition for the procurement of such
products or processes by the Government.
27.407 Rights to technical data in successful proposals.
The clause at 52.227-23, Rights to Proposal Data (Technical),
allows the Government to acquire unlimited rights to technical data in
successful proposals. Pursuant to the clause, the prospective
contractor is afforded the opportunity to specifically identify pages
containing technical data to be excluded from the grant of unlimited
rights. This exclusion is not dispositive of the protective status of
the data, but any excluded technical data, as well as any commercial
and financial information contained in the proposal, will remain
subject to the policies in Subpart 15.2 or 15.6 (or agency supplements)
relating to proposal
[[Page 31807]]
information (e.g., will be used for evaluation purposes only). If there
is a need to have access to any of the excluded technical data during
contract performance, consideration should be given to acquiring the
data with limited rights, if they so qualify, in accordance with
27.404-2(c).
27.408 Cosponsored research and development activities.
(a) In contracts involving cosponsored research and development
that require the contractor to make substantial contributions of funds
or resources (e.g., by cost-sharing or by repayment of nonrecurring
costs), and the contractor's and the Government's respective
contributions to any item, component, process, or computer software,
developed or produced under the contract are not readily segregable,
the contracting officer may limit the acquisition of, or acquire less
than unlimited rights to, any data developed and delivered under the
contract. Agencies may regulate the use of this authority in their
supplements. Lesser rights shall, at a minimum, assure use of the data
for agreed-to Governmental purposes (including reprocurement rights as
appropriate), and address any disclosure limitations or restrictions to
be imposed on the data. Also, consideration may be given to requiring
the contractor to directly license others if needed to carry out the
objectives of the contract. Since the purpose of the cosponsored
research and development, the legitimate proprietary interests of the
contractor, the needs of the Government, and the respective
contributions of both parties may vary, no specific clauses are
prescribed, but a clause providing less than unlimited rights in the
Government for data developed and delivered under the contract (such as
license rights) may be tailored to the circumstances consistent with
the foregoing and the policy set forth in 27.402. As a guide, a clause
may be appropriate when the contractor contributes money or resources,
or agrees to make repayment of nonrecurring costs, of a value of
approximately 50 percent of the total cost of the contract (i.e.,
Government, contractor, and/or third party paid costs), and the
respective contributions are not readily segregable for any work
element to be performed under the contract. A clause may be used for
all or for only specifically identified tasks or work elements under
the contract. In the latter instance, its use will be in addition to
whatever other data rights clause is prescribed under this subpart,
with the contract specifically identifying which clause is to apply to
which tasks or work elements. Further, this type of clause may not be
appropriate where the purpose of the contract is to produce data for
dissemination to the public, or to develop or demonstrate technologies
that will be available, in any event, to the public for their direct
use.
(b) Where the contractor's contributions are readily segregable (by
performance requirements and the funding for the contract) and so
identified in the contract, any resulting data may be treated under
this clause as limited rights data or restricted computer software in
accordance with 27.404-2(c) or (d), as applicable; or if this treatment
is inconsistent with the purpose of the contract, rights to the data
may, if so negotiated and stated in the contract, be treated in a
manner consistent with paragraph (a) of this section.
27.409 Solicitation provisions and contract clauses.
(a) Generally, a contract should contain only one data rights
clause. However, where more than one is needed, the contract should
distinguish the portion of contract performance to which each pertains.
(b)(1) Insert the clause at 52.227-14, Rights in Data-- General, in
solicitations and contracts if it is contemplated that data will be
produced, furnished, or acquired under the contract, unless the
contract is--
(i) For the production of special works of the type set forth in
27.405-1, although in these cases insert the clause at 52.227-14,
Rights in Data--General, and make it applicable to data other than
special works, as appropriate (see paragraph (e) of this section);
(ii) For the acquisition of existing data works, as described in
27.405-2 (see paragraphs (f) and (g) of this section);
(iii) A small business innovation research contract (see paragraph
(h) of this section);
(iv) To be performed outside the United States (see paragraph
(i)(1) of this section);
(v) For architect-engineer services or construction work (see
paragraph (i)(2) of this section);
(vi) For the management, operation, design, or construction of a
Government-owned facility to perform research, development, or
production work (see paragraph (i)(3) of this section); or
(vii) A contract involving cosponsored research and development in
which a clause providing for less than unlimited right has been
authorized (see 27.408).
(2) If an agency determines, in accordance with 27.404-2(b), to
adopt the alternate definition of ``Limited Rights Data'' in paragraph
(a) of the clause, use the clause with its Alternate I.
(3) If a contracting officer determines, in accordance with 27.404-
2(c), that it is necessary to obtain limited rights data, use the
clause with its Alternate II. The contracting officer shall complete
paragraph (g)(3) to include the purposes, if any, for which limited
rights data are to be disclosed outside the Government.
(4) In accordance with 27.404-2(d), if a contracting officer
determines it is necessary to obtain restricted computer software, use
the clause with its Alternate III. Any greater or lesser rights
regarding the use, reproduction, or disclosure of restricted computer
software than those set forth in the Restricted Rights Notice of
paragraph (g)(4) of Alternate III of the clause shall be specified in
the contract and the notice modified accordingly.
(5) Use the clause with its Alternate IV in contracts for basic or
applied research (other than those for the management or operation of
Government facilities or where international agreements require
otherwise) to be performed solely by universities and colleges. The
clause may be used with its Alternate IV in other contracts if, in
accordance with 27.404-3(a), an agency determines to grant permission
for the contractor to establish claim to copyright subsisting in all
data first produced without further request being made by the
contractor. When Alternate IV is used, the contract may exclude items
or categories of data from the permission granted, either by express
provisions in the contract or by the addition of a paragraph (d)(3) to
the clause (see 27.404-4).
(6) In accordance with 27.404-6, if the Government needs the right
to inspect certain data at a contractor's facility, use the clause with
its Alternate V.
(c) In accordance with 27.404-2(c)(2) and 27.404-2(d)(5), if the
contracting officer desires to have an offeror state in response to a
solicitation whether limited rights data or restricted computer
software are likely to be used in meeting the data delivery
requirements set forth in the solicitation, insert the provision at
52.227-15, Representation of Limited Rights Data and Restricted
Computer Software, in any solicitation containing the clause at 52.227-
14, Rights in Data--General. The contractor's response may provide an
aid in determining whether the clause should be used with Alternate II
and/or Alternate III.
[[Page 31808]]
(d) Insert the clause at 52.227-16, Additional Data Requirements,
in solicitations and contracts involving experimental, developmental,
research, or demonstration work (other than basic or applied research
to be performed solely by a university or college where the contract
amount will be $500,000 or less) unless all the requirements for data
are believed to be known at the time of contracting and specified in
the contract (see 27.406-2). This clause may also be used in other
contracts when considered appropriate. For example, if the contract is
for basic or applied research to be performed by a university or
college, and the contracting officer believes the contract effort will
in the future exceed $500,000, even though the initial award does not,
the contracting officer may include the clause in the initial award.
(e) In accordance with 27.405-1, insert the clause at 52.227-17,
Rights in Data--Special Works, in solicitations and contracts primarily
for the production or compilation of data (other than limited rights
data or restricted computer software) for the Government's internal
use, or when there is a specific need to limit distribution and use of
the data or to obtain indemnity for liabilities that may arise out of
the content, performance, or disclosure of the data. Examples of such
contracts are set forth in 27.405-1.
(1) Insert the clause if existing works are to be modified, as by
editing, translation, addition of subject matter, etc.
(2) The contract may specify the purposes and conditions (including
time limitations) under which the data may be used, released, or
reproduced by the contractor for other than contract performance.
(3) Contracts for the production of audiovisual works, sound
recordings, etc., may include limitations in connection with talent
releases, music licenses, and the like that are consistent with the
purposes for which the data is acquired.
(4) The clause may be modified in accordance with paragraphs (c)
through (e) of 27.405-1.
(f) Insert the clause at 52.227-18, Rights in Data-- Existing
Works, in solicitations and contracts exclusively for the acquisition,
without modification, of existing audiovisual and similar works of the
type set forth in 27.405-2. The contract may set forth limitations
consistent with the purposes for which the work is being acquired.
While no specific clause of this subpart is required to be included in
contracts solely for the acquisition, without disclosure prohibitions,
of books, publications, and similar items in the exact form in which
the items exist prior to the request for purchase (i.e., the off-the-
shelf purchase of such items), or in other contracts where only
existing data available without disclosure prohibitions is to be
furnished, if reproduction rights are to be acquired, the contract
shall include terms addressing such rights. (See 27.405-3(b).)
(g) In accordance with 27.405-3(a), when contracting (other than
from GSA's Multiple Award Schedule contracts) for the acquisition of
commercial computer software, the contracting officer may insert the
clause at 52.227-19, Commercial Computer Software License, in the
solicitation and contract. In any event, the contracting officer shall
assure that the contract contains terms to obtain sufficient rights for
the Government to fulfill the need for which the software is being
acquired and is otherwise consistent with 27.405-3(a).
(h) If the contract is a Small Business Innovation Research (SBIR)
contract, insert the clause at 52.227-20, Rights in Data--SBIR Program,
in all Phase I and Phase II contracts awarded under the Small Business
Innovation Research Program established pursuant to 15 U.S.C. 638.
(i) Agencies may prescribe in their procedures, as appropriate, a
clause consistent with the policy of 27.402 in contracts--
(1) To be performed outside the United States;
(2) For architect-engineer services and construction work (may
prescribe the clause at 52.227-17, Rights in Data-- Special Works); or
(3) For management, operation, design, or construction of
Government-owned research, development, or production facilities, and
in contracts and subcontracts in support of programs being conducted at
such facilities.
(j) In accordance with 27.406-3(a), insert the clause at 52.227-21,
Technical Data Declaration, Revision, and Withholding of Payment--Major
Systems, in contracts for major systems acquisitions or for support of
major systems acquisitions. This requirement includes contracts for
detailed design, development, or production of a major system and
contracts for any individual part, component, subassembly, assembly, or
subsystem integral to the major system, and other property that may be
replaced during the service life of the system, including spare parts.
When used, this clause requires that the technical data to which it
applies be specified in the contract (see 27.406-3(a)).
(k) In accordance with 27.406-3(b), in the case of civilian
agencies other than NASA and the U.S. Coast Guard, insert the clause at
52.227-22, Major System--Minimum Rights, in contracts for major systems
or contracts in support of major systems.
(l) In accordance with 27.407, if a contracting officer desires to
acquire unlimited rights in technical data contained in a successful
proposal upon which a contract award is based, insert the clause at
52.227-23, Rights to Proposed Data (Technical). Rights to technical
data in a proposal are not acquired by mere incorporation by reference
of the proposal in the contract, and if a proposal is incorporated by
reference, the contracting officer shall follow section 27.404 to
assure that the rights are appropriately addressed.
Subpart 27.5--Foreign License and Technical Assistance Agreements
27.501 General.
Agencies shall provide necessary policy and procedures regarding
foreign technical assistance agreements and license agreements
involving intellectual property, including avoiding unnecessary royalty
charges.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES.
5. Amend section 52.227-1 by revising the introductory text of the
clause and the introductory text of Alternates I and II to read as
follows:
52.227-1 Authorization and Consent.
As prescribed in 27.201-2(a)(1), insert the following clause:
* * * * *
Alternate I (Apr 1984). As prescribed in 27.201-2(a)(2),
substitute the following paragraph (a) for paragraph (a) of the
basic clause:
* * * * *
Alternate II (Apr 1984). As prescribed in 27.201-2(a)(3),
substitute the following paragraph (a) for paragraph (a) of the
basic clause:
* * * * *
52.227-2 [Amended]
6. In section 52.227-2, amend the introductory text of the clause
by removing ``at 27.202-2'' and adding ``in 27.201-2(b)'' in its place.
7. Amend section 52.227-3 by revising the introductory text of the
clause and the introductory text of Alternates I, II, and III to read
as follows:
[[Page 31809]]
52.227-3 Patent Indemnity.
As prescribed in 27.201-2(c)(1), insert the following clause:
* * * * *
Alternate I (Apr 1984). As prescribed in 27.201-2(c)(2), add the
following paragraph (c) to the basic clause:
* * * * *
Alternate II (Apr 1984). As prescribed in 27.201-2(c)(2), add
the following paragraph (c) to the basic clause:
* * * * *
Alternate III (July 1995). As prescribed in 27.201-2(c)(3), add
the following paragraph to the basic clause:
* * * * *
8. Amend section 52.227-4 by revising the introductory paragraph of
the clause; and Alternate I to read as follows:
52.227-4 Patent Indemnity--Construction Contracts.
As prescribed in 27.201-2(d)(1), insert the following clause:
* * * * *
Alternate I (Date). As prescribed in 27.201-2(d)(2), designate
the first paragraph of the basic clause as paragraph (a) and add the
following paragraph (b) to the basic clause:
(b) This patent indemnification shall not apply to the following
items:
[Contracting Officer list the items to be excluded.]
52.227-5 [Amended]
9. In section 52.227-5, amend the introductory paragraph of the
clause by removing `` at 27.203-6'' and adding ``in 27.201-2(e)'' in
its place.
10. Amend section 52.227-6 by revising the introductory paragraphs
of the provision and Alternate I to read as follows:
52.227-6 Royalty Information.
As prescribed in 27.202-5(a)(1), insert the following provision:
* * * * *
Alternate I (Apr 1984). As prescribed in 27.202-5(a)(2),
substitute the following for the introductory portion of paragraph
(a) of the basic provision:
* * * * *
52.227-7 [Amended]
11. In section 52.227-7, amend the introductory paragraph of the
provision by removing ``at 27.204-3(c)'' and adding ``in 27.202-5(b)''
in its place.
12. Amend section 52.227-9 by revising the introductory paragraph
of the clause to read as follows:
52.227-9 Refund of Royalties.
As prescribed in 27.202-5(c), insert the following clause:
* * * * *
52.227-10 [Amended]
13. In section 52.227-10, amend the introductory paragraph of the
clause by removing ``at 27.207-2'' and adding ``in 27.203-2'' in its
place.
14. Revise section 52.227-11 and its section heading to read as
follows:
52.227-11 Patent Rights--Ownership by the Contractor.
As prescribed in 27.303(b)(1), insert the following clause:
Patent Rights--Ownership by the Contractor (Date)
(a) As used in this clause--
Invention means any invention or discovery that is or may be
patentable or otherwise protectable under title 35 of the United
States Code, or any novel variety of plant that is or may be
protected under the Plant Variety Protection Act (7 U.S.C. 2321, et
seq.).
Made, when used in relation to any invention, means the
conception or first actual reduction to practice of the invention.
Nonprofit organization means a university or other institution
of higher education, or an organization of the type described in
section 501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C.
501(c)) and exempt from taxation under section 501(a) of the
Internal Revenue Code (26 U.S.C. 501(a)), or any nonprofit
scientific or educational organization qualified under a state
nonprofit organization statute.
Practical application means to manufacture, in the case of a
composition of product; to practice, in the case of a process or
method; or to operate, in the case of a machine or system; and, in
each case, under such conditions as to establish that the invention
is being utilized and that its benefits are, to the extent permitted
by law or Government regulations, available to the public on
reasonable terms.
Subject invention means any invention of the contractor made in
the performance of work under this contract; provided that in the
case of a variety of plant, the date of determination defined in 7
U.S.C. 2401(d), must also occur during the period of contract
performance.
(b) Contractor's Rights--(1) Ownership. The Contractor may elect
to retain ownership throughout the world of each subject invention
in accordance with the provisions of this clause.
(2) License. (i) The Contractor shall retain a nonexclusive
paid-up license throughout the world in each subject invention to
which the Government obtains title, except if the Contractor fails
to disclose the invention within the times specified in paragraph
(c) of this clause. The Contractor's license extends to any domestic
subsidiaries and affiliates within the corporate structure of which
the Contractor is a part, and includes the right to grant
sublicenses to the extent the Contractor was legally obligated to do
so at contract award. The license is transferable only with the
approval of the agency, except when transferred to the successor of
that part of the Contractor's business to which the invention
pertains.
(ii) The Contractor's domestic license may be revoked or
modified by the agency to the extent necessary to achieve
expeditious practical application of the subject invention pursuant
to an application for an exclusive license submitted in accordance
with 37 CFR part 404 and agency licensing regulations. This license
will not be revoked in that field of use or the geographical areas
in which the Contractor has achieved practical application and
continues to make the benefits of the invention reasonably
accessible to the public. The license in any foreign country may be
revoked or modified at the discretion of the agency to the extent
the Contractor, its licensees, or the domestic subsidiaries or
affiliates have failed to achieve practical application in that
foreign country.
(iii) Before revoking or modifying the license, the agency will
furnish the Contractor a written notice of its intention to revoke
or modify the license, and the Contractor will be allowed 30 days
(or such other time as may be authorized by the funding agency for
good cause shown by the Contractor) after the notice to show cause
why the license should not be revoked or modified. The Contractor
has the right to appeal, in accordance with 37 CFR part 404 and
agency regulations, concerning the licensing of Government-owned
inventions, any decision concerning the revocation or modification
of the license.
(c) Contractor's obligations. (1) The Contractor shall disclose
in writing each subject invention to the contracting officer within
2 months after the inventor discloses it in writing to Contractor
personnel responsible for patent matters. The disclosure shall
identify the inventor(s) and this contract under which the subject
invention was made. It shall be sufficiently complete in technical
detail to convey a clear understanding of the subject invention. The
disclosure shall also identify any publication, on sale (i.e., sale
or offer for sale), or public use of the subject invention, or
whether a manuscript describing the subject invention has been
submitted for publication and, if so, whether it has been accepted
for publication. In addition, after disclosure to the agency, the
Contractor shall promptly notify the agency of the acceptance of any
manuscript describing the subject invention for publication and any
on sale or public use.
(2) The Contractor shall elect in writing whether or not to
retain ownership of any subject invention by notifying the agency
within 2 years of disclosure to the agency. However, in any case
where publication, on sale, or public use has initiated the 1-year
statutory period during which valid patent protection can be
obtained in the United States, the period for election of title may
be shortened by the agency to a date that is no more than 60 days
prior to the end of the statutory period.
(3) The Contractor shall file either a provisional or a
nonprovisional patent application on an elected subject invention
within 1 year after election. However, in any case where a
publication, on sale, or public use has initiated the 1-year
statutory period during which valid patent protection can be
obtained in the United States, the Contractor shall file the
application prior to the end of
[[Page 31810]]
that statutory period. If the Contractor files a provisional
application, it shall file a nonprovisional application within 10
months of the filing of the provisional application. The Contractor
shall file patent applications in additional countries or
international patent offices within either 10 months of the filing
of the patent application (whether provisional or nonprovisional) or
6 months from the date permission is granted by the Commissioner of
Patents to file foreign patent applications where such filing has
been prohibited by a Secrecy Order.
(4) The Contractor may request extensions of time for
disclosure, election, or filing under paragraphs (c)(1), (c)(2), and
(c)(3) of this clause.
(d) Government's rights--(1) Ownership. The Contractor shall
convey to the agency, on written request, title to any subject
invention--
(i) If the Contractor fails to disclose or elect ownership to
the subject invention within the times specified in paragraph (c) of
this clause, or elects not to retain ownership; provided, that the
agency may request title only within 60 days after learning of the
failure of the Contractor to disclose or elect within the specified
times.
(ii) In those countries in which the Contractor fails to file
patent applications within the times specified in paragraph (c) of
this clause; provided, however, that if the Contractor has filed a
patent application in a country after the times specified in
paragraph (c) of this clause, but prior to its receipt of the
written request of the agency, the Contractor shall continue to
retain ownership in that country.
(iii) In any country in which the Contractor decides not to
continue the prosecution of any application for, to pay the
maintenance fees on, or defend in reexamination or opposition
proceeding on, a patent on a subject invention.
(2) License. If the Contractor retains ownership of any subject
invention, the Government shall have a nonexclusive,
nontransferable, irrevocable, paid-up license to practice, or have
practiced for or on its behalf, the subject invention throughout the
world.
(e) Contractor action to protect the Government's interest. (1)
The Contractor shall execute or have executed and promptly deliver
to the agency all instruments necessary to--
(i) Establish or confirm the rights the Government has
throughout the world in those subject inventions in which the
Contractor elects to retain ownership; and
(ii) Convey title to the agency when requested under paragraph
(d) of this clause and to enable the Government to obtain patent
protection for that subject invention in any country.
(2) The Contractor shall require, by written agreement, its
employees, other than clerical and nontechnical employees, to
disclose promptly in writing to personnel identified as responsible
for the administration of patent matters and in the Contractor's
format, each subject invention in order that the Contractor can
comply with the disclosure provisions of paragraph (c) of this
clause, and to execute all papers necessary to file patent
applications on subject inventions and to establish the Government's
rights in the subject inventions. The disclosure format should
require, as a minimum, the information required by paragraph (c)(1)
of this clause. The Contractor shall instruct such employees,
through employee agreements or other suitable educational programs,
as to the importance of reporting inventions in sufficient time to
permit the filing of patent applications prior to U.S. or foreign
statutory bars.
(3) The Contractor shall notify the agency of any decisions not
to file a nonprovisional patent application, continue the
prosecution of a patent application, pay maintenance fees, or defend
in a reexamination or opposition proceeding on a patent, in any
country, not less than 30 days before the expiration of the response
or filing period required by the relevant patent office.
(4) The Contractor shall include, within the specification of
any United States nonprovisional patent application and any patent
issuing thereon covering a subject invention, the following
statement: ``This invention was made with Government support under
(identify the contract) awarded by (identify the agency). The
Government has certain rights in the invention.''
(f) Subcontracts. (1) The Contractor shall include this clause,
suitably modified to identify the parties, in all subcontracts,
regardless of tier, for experimental, developmental, or research
work to be performed by a small business concern or nonprofit
organization. The subcontractor retains all rights provided for the
Contractor in this clause, and the Contractor shall not, as part of
the consideration for awarding the subcontract, obtain rights in the
subcontractor's subject inventions.
(2) The Contractor shall include in all other subcontracts,
regardless of tier, for experimental, developmental, or research
work the patent rights clause required by FAR Subpart 27.3.
(3) In the case of subcontracts, at any tier, the agency,
subcontractor, and the Contractor agree that the mutual obligations
of the parties created by this clause constitute a contract between
the subcontractor and the agency with respect to the matters covered
by the clause; provided, however, that nothing in this paragraph is
intended to confer any jurisdiction under the Contract Disputes Act
in connection with proceedings under paragraph (i) of this clause.
(g) Reporting on utilization of subject inventions. The
Contractor shall submit, on request, periodic reports no more
frequently than annually on the utilization of a subject invention
or on efforts at obtaining utilization of the subject invention that
are being made by the Contractor or its licensees or assignees. The
reports shall include information regarding the status of
development, date of first commercial sale or use, gross royalties
received by the Contractor, and other data and information as the
agency may reasonably specify. The Contractor also shall provide
additional reports as may be requested by the agency in connection
with any march-in proceeding undertaken by the agency in accordance
with paragraph (i) of this clause. As required by 35 U.S.C.
202(c)(5), the agency will not disclose that information to persons
outside the Government without permission of the Contractor.
(h) Preference for United States industry. Notwithstanding any
other provision of this clause, neither the Contractor nor any
assignee shall grant to any person the exclusive right to use or
sell any subject invention in the United States unless such person
agrees that any product embodying the subject invention or produced
through the use of the subject invention will be manufactured
substantially in the United States. However, in individual cases,
the requirement for an agreement may be waived by the agency upon a
showing by the Contractor or its assignee that reasonable but
unsuccessful efforts have been made to grant licenses on similar
terms to potential licensees that would be likely to manufacture
substantially in the United States or that under the circumstances
domestic manufacture is not commercially feasible.
(i) March-in rights. The Contractor acknowledges that, with
respect to any subject invention in which it has retained ownership,
the agency has the right to require licensing pursuant to 35 U.S.C.
203 and in accordance with the procedures in 37 CFR 401.6 and any
supplemental regulations of the agency in effect on the date of
contract award.
(j) Special provisions for contracts with nonprofit
organizations. If the Contractor is a nonprofit organization, it
shall--
(1) Not assign rights to a subject invention in the United
States without the approval of the agency, except where an
assignment is made to an organization which has as one of its
primary functions the management of inventions, provided that the
assignee shall be subject to the same provisions as the Contractor;
(2) Share royalties collected on a subject invention with the
inventor, including Federal employee co-inventors (but through their
agency if the agency deems it appropriate) when the subject
invention is assigned in accordance with 35 U.S.C. 202(e) and 37 CFR
401.10;
(3) Use the balance of any royalties or income earned by the
Contractor with respect to subject inventions, after payment of
expenses (including payments to inventors) incidental to the
administration of subject inventions for the support of scientific
research or education; and
(4) Make efforts that are reasonable under the circumstances to
attract licensees of subject inventions that are small business
concerns, and give a preference to a small business concern when
licensing a subject invention if the Contractor determines that the
small business concern has a plan or proposal for marketing the
invention which, if executed, is equally as likely to bring the
invention to practical application as any plans or proposals from
applicants that are not small business concerns; provided, that the
Contractor is also satisfied that the small business concern has the
capability and resources to carry out its plan or proposal. The
decision whether to give a preference in any specific case will be
at the discretion of the contractor.
[[Page 31811]]
(5) Allow the Secretary of Commerce to review the Contractor's
licensing program and decisions regarding small business applicants,
and negotiate changes to its licensing policies, procedures, or
practices with the Secretary of Commerce when the Secretary's review
discloses that the Contractor could take reasonable steps to more
effectively implement the requirements of paragraph (j)(4) of this
clause.
(k) Communications. [Complete according to agency instructions.]
(End of clause)
Alternate I (Date). As prescribed in 27.303(b)(3), add the
following sentence at the end of paragraph (d)(2) of the basic
clause:
The license shall include the right of the Government to
sublicense foreign governments, their nationals and international
organizations pursuant to the following treaties or international
agreements: ----------*
[* Contracting Officer complete with the names of applicable
existing treaties or international agreements. The above language is
not intended to apply to treaties or agreements that are in effect
on the date of the award but are not listed.]
Alternate II (Date). As prescribed in 27.303(b)(4), add the
following sentence at the end of paragraph (d)(2) of the basic
clause:
The agency reserves the right to unilaterally amend this
contract to identify specific treaties or international agreements
entered into by the Government before or after the effective date of
the contract and effectuate those license or other rights that are
necessary for the Government to meet its obligations to foreign
governments, their nationals and international organizations under
such treaties or international agreements with respect to subject
inventions made after the date of the amendment.
Alternate III (Date). As prescribed in 27.303(b)(5), substitute
the following paragraph (j)(3) in place of paragraph (j)(3) of the
basic clause:
(3) After payment of patenting costs, licensing costs, payments
to inventors, and other expenses incidental to the administration of
subject inventions, the balance of any royalties or income earned
and retained by the Contractor during any fiscal year on subject
inventions under this or any successor contract containing the same
requirement, up to any amount equal to 5 percent of the budget of
the facility for that fiscal year, shall be used by the Contractor
for the scientific research, development, and education consistent
with the research and development mission and objectives of the
facility, including activities that increase the licensing potential
of other inventions of the facility. If the balance exceeds 5
percent, 75 percent of the excess above 5 percent shall be paid by
the Contractor to the Treasury of the United States and the
remaining 25 percent shall be used by the Contractor only for the
same purposes as described above. To the extent it provides the most
effective technology transfer, the licensing of subject inventions
shall be administered by Contractor employees on location at the
facility.
Alternate IV (Date). As prescribed in 27.303(b)(6), include the
following paragraph (e)(5) in paragraph (e) of the basic clause:
(5) The Contractor shall establish and maintain active and
effective procedures to ensure that subject inventions are promptly
identified and timely disclosed, and shall submit a description of
the procedures to the Contracting Officer so that the Contracting
Officer may evaluate and determine their effectiveness.
52.227-12 [Reserved]
15. Remove and reserve section 52.227-12.
16. Revise sections 52.227-13 through 52.227-17 to read as follows:
52.227-13 Patent Rights--Ownership by the Government.
As prescribed in 27.303(e), insert the following clause:
Patent Rights--Ownership by the Government (Date)
(a) Definitions. As used in this clause--
Invention means any invention or discovery which is or may be
patentable or otherwise protectable under title 35 of the United
States Code or any novel variety of plant that is or may be
protectable under the Plant Variety Protection Act (7 U.S.C. 2321,
et seq.).
Made, when used in relation to any invention, means the
conception or first actual reduction to practice of the invention.
Practical application means to manufacture, in the case of a
composition or product; to practice, in the case of a process or
method; or to operate, in the case of a machine or system; and, in
each case, under such conditions as to establish that the invention
is being utilized and that its benefits are, to the extent permitted
by law or Government regulations, available to the public on
reasonable terms.
Subject invention means any invention of the Contractor made in
the performance of work under this contract; provided, that in the
case of a variety of plant, the date of determination defined in 7
U.S.C. 2401(d) must also occur during the period of contract
performance.
(b) Ownership--(1) Assignment to the Government. The Contractor
shall assign to the Government title throughout the world to each
subject invention, except to the extent that rights are retained
under paragraphs (b)(2) and (d) of this clause.
(2) Greater rights determinations. (i) The Contractor, or an
employee-inventor after consultation with the Contractor, may
request greater rights than the nonexclusive license provided in
paragraph (d) of this clause. The request for greater rights must be
submitted to the Contracting Officer at the time of the first
disclosure of the subject invention pursuant to paragraph (e)(2) of
this clause, or not later than 8 months thereafter, unless a longer
period is authorized in writing by the Contracting Officer for good
cause shown in writing by the Contractor. Each determination of
greater rights under this contract normally shall be subject to
paragraph (c) of this clause, and to the reservations and conditions
deemed to be appropriate by the agency.
(ii) Upon request, the Contractor shall provide the filing date,
serial number and title, a copy of the patent application (including
an English-language version if filed in a language other than
English), and patent number and issue date for any subject invention
in any country for which the Contractor has retained title.
(iii) Upon request, the Contractor shall furnish the agency an
irrevocable power to inspect and make copies of the patent
application file.
(c) Minimum rights acquired by the Government. (1) Regarding
each subject invention to which the Contractor retains ownership,
the Contractor agrees as follows:
(i) The Federal Government will have a nonexclusive,
nontransferable, irrevocable, paid-up license to practice or have
practiced for or on behalf of the United States the subject
invention throughout the world.
(ii) The agency has the right, pursuant to 35 U.S.C. 203 and
210(c) and in accordance with the procedures set forth in 37 CFR
401.6, to require the Contractor, an assignee, or exclusive licensee
of a subject invention to grant a nonexclusive, partially exclusive,
or exclusive license in any field of use to a responsible applicant
or applicants, upon terms that are reasonable under the
circumstances. If the Contractor, assignee, or exclusive licensee
refuses the request, the agency has the right to grant the license
itself if the agency determines that this action is necessary--
(A) Because the Contractor or assignee has not taken, or is not
expected to take within a reasonable time, effective steps to
achieve practical application of the subject invention in the field
of use;
(B) To alleviate health or safety needs which are not reasonably
satisfied by the Contractor, assignee, or their licensees;
(C) To meet requirements for public use specified by Federal
regulations and these requirements are not reasonably satisfied by
the Contractor, assignee, or licensee; or
(D) Because the agreement required by paragraph (i)--Preference
for United States industry--of this clause has neither been obtained
nor waived or because a licensee of the exclusive right to use or
sell any subject invention in the United States is in breach of this
agreement.
(iii) Upon request, the Contractor shall submit periodic reports
no more frequently than annually on the utilization, or efforts to
obtain utilization, of a subject invention by the Contractor or its
licensees or assignees. These reports shall include information
regarding the status of development, date of first commercial sale
or use, gross royalties received by the Contractor, and such other
data and information as the agency may reasonably specify. The
Contractor also shall provide additional reports as may be requested
by the agency in connection with any march-in proceedings undertaken
by the agency in accordance with paragraph (c)(1)(ii) of this
clause. To the extent data or information supplied under this
section is considered by the Contractor, or its licensees, or
assignees to be privileged and confidential and is so marked, the
agency, to the extent
[[Page 31812]]
permitted by law, will not disclose such information to persons
outside the Government.
(iv) When licensing a subject invention, the Contractor shall--
(A) Ensure that no royalties are charged on acquisitions
involving Government funds, including funds derived through a
Military Assistance Program of the Government or otherwise derived
through the Government;
(B) Refund any amounts received as royalty charges on a subject
invention in acquisitions for, or on behalf of, the Government;
(C) Provide for this refund in any instrument transferring
rights in the subject invention to any party.
(v) When transferring rights in a subject invention, the
Contractor shall provide for the Government's rights set forth in
paragraphs (c)(1)(i) through (c)(1)(iv) of this clause.
(2) Nothing contained in paragraph (c) of this clause shall be
deemed to grant to the Government rights in any invention other than
a subject invention.
(d) Minimum rights to the Contractor. (1) The Contractor is
hereby granted a revocable, nonexclusive, paid-up license in each
patent application filed in any country on a subject invention and
any resulting patent in which the Government obtains title, unless
the Contractor fails to disclose the subject invention within the
times specified in paragraph (e)(2) of this clause. The Contractor's
license extends to any of its domestic subsidiaries and affiliates
within the corporate structure of which the Contractor is a part,
and includes the right to grant sublicenses to the extent the
Contractor was legally obligated to do so at contract award. The
license is transferable only with the approval of the agency, except
when transferred to the successor of that part of the Contractor's
business to which the subject invention pertains.
(2) The Contractor's domestic license may be revoked or modified
by the agency to the extent necessary to achieve expeditious
practical application of the subject invention in accordance with
the procedures in FAR 27.302(i)(2) and 27.304-1(f).
(3) When the Government elects not to apply for a patent in any
foreign country, the Contractor retains rights in that foreign
country to apply for a patent, subject to the Government's rights in
paragraph (c)(1) of this clause.
(e) Invention identification, disclosures, and reports. (1) The
Contractor shall establish and maintain active and effective
procedures to educate its employees in order to assure that subject
inventions are promptly identified and disclosed to Contractor
personnel responsible for patent matters. These procedures shall
include the maintenance of laboratory notebooks for equivalent
records and other records as are reasonably necessary to document
the conception and/or the first actual reduction to practice of
subject inventions, and records that show the procedures for
identifying and disclosing subject inventions are followed. Upon
request, the Contractor shall furnish the Contracting Officer a
description of these procedures for evaluation and for a
determination as to their effectiveness.
(2) The Contractor shall disclose each subject invention to the
Contracting Officer within 2 months after the inventor discloses it
in writing to Contractor personnel responsible for patent matters
or, if earlier, within 6 months after the Contractor becomes aware
that a subject invention has been made, but in any event before any
on sale (i.e., sale or offer for sale), public use, or publication
of the subject invention known to the Contractor. The disclosure
shall identify the contract under which the subject invention was
made and the inventor(s). It shall be sufficiently complete in
technical detail to convey a clear understanding of the subject
invention. The disclosure shall also identify any publication, on
sale, or public use of the subject invention and whether a
manuscript describing the subject invention has been submitted for
publication and, if so, whether it has been accepted for publication
at the time of disclosure. In addition, after disclosure to the
agency, the Contractor shall promptly notify the Contracting Officer
of the acceptance of any manuscript describing the subject invention
for publication or of any on sale or public use planned by the
Contractor.
(3) The Contractor shall furnish the Contracting Officer the
following:
(i) Interim reports every 12 months (or a longer period as may
be specified by the Contracting Officer) from the date of the
contract, listing subject inventions during that period, and stating
that all subject inventions have been disclosed (or that there are
none) and that the procedures required by paragraph (e)(1) of this
clause have been followed.
(ii) A final report, within 3 months after completion of the
contracted work, listing all subject inventions or stating that
there were none, and listing all subcontracts at any tier containing
a patent rights clause or stating that there were none.
(4) The Contractor shall require, by written agreement, its
employees, other than clerical and nontechnical employees, to
disclose promptly in writing to personnel identified as responsible
for the administration of patent matters and in the Contractor's
format each subject invention in order that the Contractor can
comply with the disclosure provisions of paragraph (c) of this
clause, and to execute all papers necessary to file patent
applications on subject inventions and to establish the Government's
rights in the subject inventions. This disclosure format should
require, as a minimum, the information required by paragraph (e)(2)
of this clause. The Contractor shall instruct such employees,
through employee agreements or other suitable educational programs,
as to the importance of reporting inventions in sufficient time to
permit the filing of patent applications prior to U.S. or foreign
statutory bars.
(5) Subject to FAR 27.302(i), the Contractor agrees that the
Government may duplicate and disclose subject invention disclosures
and all other reports and papers furnished or required to be
furnished pursuant to this clause.
(f) Examination of records relating to inventions. (1) The
Contracting Officer or any authorized representative shall, until 3
years after final payment under this contract, have the right to
examine any books (including laboratory notebooks), records, and
documents of the Contractor relating to the conception or first
actual reduction to practice of inventions in the same field of
technology as the work under this contract to determine whether--
(i) Any inventions are subject inventions;
(ii) The Contractor has established and maintains the procedures
required by paragraphs (e)(1) and (e)(4) of this clause; and
(iii) The Contractor and its inventors have complied with the
procedures.
(2) The Contractor shall disclose to the agency, for the
determination of ownership rights, any unreported invention that the
Contracting Officer believes may be a subject invention.
(3) Any examination of records under paragraph (f) of this
clause will be subject to appropriate conditions to protect the
confidentiality of the information involved.
(g) Withholding of payment. (This paragraph does not apply to
subcontracts.) (1) Any time before final payment under this
contract, the Contracting Officer may, in the Government's interest,
withhold payment until a reserve not exceeding $50,000 or 5 percent
of the amount of this contract, whichever is less, shall have been
set aside if, in the Contracting Officer's opinion, the Contractor
fails to--
(i) Establish, maintain, and follow effective procedures for
identifying and disclosing subject inventions pursuant to paragraph
(e)(1) of this clause;
(ii) Disclose any subject invention pursuant to paragraph (e)(2)
of this clause;
(iii) Deliver acceptable interim reports pursuant to paragraph
(e)(3)(i) of this clause; or
(iv) Provide the information regarding subcontracts pursuant to
paragraph (h)(4) of this clause.
(2) The Contracting Officer will withhold the reserve or balance
until the Contracting Officer has determined that the Contractor has
rectified whatever deficiencies exist and has delivered all reports,
disclosures, and other information required by this clause.
(3) The Contracting Officer will not make final payment under
this contract before the Contractor delivers to the Contracting
Officer, as required by this clause, all disclosures of subject
inventions, an acceptable final report, and all due confirmatory
instruments.
(4) The Contracting Officer may decrease or increase the sums
withheld up to the maximum authorized. The Contracting Officer will
not withhold any amount under this paragraph while the amount
specified by this paragraph is being withheld under other provisions
of the contract. The withholding of any amount or the subsequent
payment shall not be construed as a waiver of any Government rights.
(h) Subcontracts. (1) The Contractor shall include this clause
(suitably modified to identify the parties) in all subcontracts,
regardless of tier, for experimental, developmental, or research
work. The subcontractor shall retain all rights provided for the
Contractor in this clause, and the Contractor shall not, as part of
the consideration for awarding the subcontract, obtain rights in the
subcontractor's subject inventions.
[[Page 31813]]
(2) In the event of a refusal by a prospective subcontractor to
accept this clause, the Contractor--
(i) Shall promptly submit a written notice to the Contracting
Officer setting forth the subcontractor's reasons for such refusal
and other pertinent information that may expedite disposition of the
matter; and
(ii) Shall not proceed with such subcontract without the written
authorization of the Contracting Officer.
(3) In the case of subcontracts at any tier, the agency,
subcontractor, and Contractor agree that the mutual obligations of
the parties created by this clause constitute a contract between the
subcontractor and the agency with respect to those matters covered
by this clause.
(4) The Contractor shall promptly notify the Contracting Officer
in writing upon the award of any subcontract at any tier containing
a patent rights clause by identifying the subcontractor, the
applicable patent rights clause, the work to be performed under the
subcontract, and the dates of award and estimated completion. Upon
request of the Contracting Officer, the Contractor shall furnish a
copy of such subcontract, and, no more frequently than annually, a
listing of the subcontracts that have been awarded.
(i) Preference for United States industry. Unless provided
otherwise, no Contractor that receives title to any subject
invention and no assignee of any Contractor shall grant to any
person the exclusive right to use or sell any subject invention in
the United States unless the person agrees that any products
embodying the subject invention will be manufactured substantially
in the United States. However, in individual cases, the requirement
may be waived by the agency upon a showing by the Contractor or
assignee that reasonable but unsuccessful efforts have been made to
grant licenses on similar terms to potential licensees that would be
likely to manufacture substantially in the United States or that,
under the circumstances, domestic manufacture is not commercially
feasible.
(End of clause)
Alternate I (Date). As prescribed in 27.304-1(e)(4), add the
following sentence at the end of paragraph (c)(1)(i) of the basic
clause:
The license will include the right of the Government to
sublicense foreign governments, their nationals, and international
organizations pursuant to the following treaties or international
agreements: ------------
[*Contracting Officer complete with the names of applicable existing
treaties or international agreements. The above language is not
intended to apply to treaties or agreements that are in effect on
the date of the award but are not listed.]
Alternate II (Date). As prescribed in 27.304-1(e)(5), add the
following sentence at the end of paragraph (c)(1)(i) of the basic
clause:
The agency reserves the right to unilaterally amend this
contract to identify specific treaties or international agreements
entered into by the Government before or after the effective date of
this contract, and effectuate those license or other rights which
are necessary for the Government to meet its obligations to foreign
governments, their nationals, and international organizations under
treaties or international agreements with respect to subject
inventions made after the date of the amendment.
52.227-14 Rights in Data--General.
As prescribed in 27.409(b)(1), insert the following clause with any
appropriate alternates:
Rights in Data--General (Date)
(a) Definitions. As used in this clause--
Computer data base means a collection of data in a form capable
of, and for the purpose of, being stored in, processed, and operated
on by a computer. The term does not include computer software.
Computer software means--
(1) Computer programs that comprise a series of instructions,
rules, routines, or statements, regardless of the media in which
recorded, that allow or cause a computer to perform a specific
operation or series of operations; and
(2) Recorded information comprising source code listings, design
details, algorithms, processes, flow charts, formulas, and related
material that would enable the computer program to be produced,
created, or compiled. The term does not include computer data bases
or computer software documentation.
Data means recorded information, regardless of form or the media
on which it may be recorded. The term includes technical data and
computer software. The term does not include information incidental
to contract administration, such as financial, administrative, cost
or pricing, or management information.
Form, fit, and function data means data relating to items,
components, or processes that are sufficient to enable physical and
functional interchangeability, and data identifying source, size,
configuration, mating and attachment characteristics, functional
characteristics, and performance requirements. For computer
software, it means data identifying source, functional
characteristics, and performance requirements, but specifically
excludes the source code, algorithm, process, formulas, and flow
charts of the software.
Limited rights means the rights of the Government in limited
rights data as set forth in the Limited Rights Notice of paragraph
(g)(3) of Alternate II if included in this clause.
Limited rights data means data, other than computer software,
that embody trade secrets or are commercial or financial and
confidential or privileged, to the extent that such data pertain to
items, components, or processes developed at private expense,
including minor modifications.
Restricted computer software means computer software developed
at private expense and that is a trade secret, is commercial or
financial and is confidential or privileged, or is copyrighted
computer software, including minor modifications of such computer
software.
Restricted rights means the rights of the Government in
restricted computer software, as set forth in a Restricted Rights
Notice of paragraph (g)(4) if included in this clause, or as
otherwise may be provided in a collateral agreement incorporated in
and made part of this contract, including minor modifications of
computer software.
Technical data means recorded information (regardless of the
form or method of the recording) of a scientific or technical nature
(including computer data bases and computer software documentation)
relating to supplies procured by an agency. This term does not
include computer software or financial, administrative, cost or
pricing, or management data or other information incidental to
contract administration. Recorded information of a scientific or
technical nature that is included in computer data bases is also
technical data.
Unlimited rights means the rights of the Government to use,
disclose, reproduce, prepare derivative works, distribute copies to
the public, and perform publicly and display publicly, in any manner
and for any purpose, and to have or permit others to do so.
(b) Allocation of rights. (1) Except as provided in paragraph
(c) of this clause, the Government shall have unlimited rights in--
(i) Data first produced in the performance of this contract;
(ii) Form, fit, and function data delivered under this contract;
(iii) Data delivered under this contract (except for restricted
computer software) that constitute manuals or instructional and
training material for installation, operation, or routine
maintenance and repair of items, components, or processes delivered
or furnished for use under this contract; and
(iv) All other data delivered under this contract unless
provided otherwise for limited rights data or restricted computer
software in accordance with paragraph (g) of this clause.
(2) The Contractor shall have the right to--
(i) Assert copyright in data first produced in the performance
of this contract to the extent provided in paragraph (c)(1) of this
clause;
(ii) Use, release to others, reproduce, distribute, or publish
any data first produced or specifically used by the Contractor in
the performance of this contract, unless provided otherwise in
paragraph (d) of this clause;
(iii) Substantiate the use of, add or correct limited rights,
restricted rights, or copyright notices and to take other
appropriate action, in accordance with paragraphs (e) and (f) of
this clause; and
(iv) Protect from unauthorized disclosure and use those data
which are limited rights data or restricted computer software to the
extent provided in paragraph (g) of this clause.
(c) Copyright--(1) Data first produced in the performance of
this contract. (i) Unless provided otherwise in paragraph (d) of
this clause, the Contractor may, without prior approval of the
Contracting Officer, assert copyright in scientific and technical
articles based on or containing data first produced in the
performance of this contract and published in academic, technical or
professional journals, symposia proceedings, or similar works. The
prior, express written permission of the Contracting Officer is
[[Page 31814]]
required to assert copyright in all other data first produced in the
performance of this contract.
(ii) When authorized to assert copyright to the data, the
Contractor shall affix the applicable copyright notices of 17 U.S.C.
401 or 402, and an acknowledgment of Government sponsorship
(including contract number).
(iii) For data other than computer software, the Contractor
grants to the Government, and others acting on its behalf, a paid-
up, nonexclusive, irrevocable worldwide license in such copyrighted
data to reproduce, prepare derivative works, distribute copies to
the public, and perform publicly and display publicly by or on
behalf of the Government. For computer software, the Contractor
grants to the Government, and others acting in its behalf, a paid-up
nonexclusive, irrevocable worldwide license in such copyrighted
computer software to reproduce, prepare derivative works, and
perform publicly and display publicly (but not to distribute copies
to the public) by or on behalf of the Government.
(2) Data not first produced in the performance of this contract.
The Contractor shall not, without the prior written permission of
the Contracting Officer, incorporate in data delivered under this
contract any data not first produced in the performance of this
contract unless the Contractor--
(i) Identifies the data; and
(ii) Grants to the Government, or acquires on its behalf, a
license of the same scope as set forth in paragraph (c)(1) of this
clause or, if such data are restricted computer software, the
Government shall acquire a copyright license as set forth in
paragraph (g)(3) of this clause (if included in this contract) or as
otherwise provided in a collateral agreement incorporated in or made
part of this contract.
(3) Removal of copyright notices. The Government will not remove
any authorized copyright notices placed on data pursuant to this
paragraph (c), and will include such notices on all reproductions of
the data.
(d) Release, publication, and use of data. The Contractor shall
have the right to use, release to others, reproduce, distribute, or
publish any data first produced or specifically used by the
Contractor in the performance of this contract, except--
(1) As prohibited by Federal export control or national security
laws or regulations;
(2) As expressly set forth in this contract; or
(3) If the Contractor receives or is given access to data
necessary for the performance of this contract that contain
restrictive markings, the Contractor shall treat the data in
accordance with such markings unless specifically authorized
otherwise in writing by the Contracting Officer.
(e) Unauthorized marking of data. (1) Notwithstanding any other
provisions of this contract concerning inspection or acceptance, if
any data delivered under this contract are marked with the notices
specified in paragraph (g)(3) or (g)(4) if included in this clause,
and use of the notices is not authorized by this clause, or if the
data bears any other restrictive or limiting markings not authorized
by this contract, the Contracting Officer may at any time either
return the data to the Contractor, or cancel or ignore the markings.
However, pursuant to 41 U.S.C. 253d, the following procedures shall
apply prior to canceling or ignoring the markings:
(i) The Contracting Officer will make written inquiry to the
Contractor affording the Contractor 30 days from receipt of the
inquiry to provide written justification to substantiate the
propriety of the markings;
(ii) If the Contractor fails to respond or fails to provide
written justification to substantiate the propriety of the markings
within the 30-day period (or a longer time not exceeding 90 days
approved in writing by the Contracting Officer for good cause
shown), the Government shall have the right to cancel or ignore the
markings at any time after said period and the data will no longer
be made subject to any disclosure prohibitions.
(iii) If the Contractor provides written justification to
substantiate the propriety of the markings within the period set in
paragraph (e)(1)(i) of this clause, the Contracting Officer will
consider such written justification and determine whether or not the
markings are to be cancelled or ignored. If the Contracting Officer
determines that the markings are authorized, the Contractor will be
so notified in writing. If the Contracting Officer determines, with
concurrence of the head of the contracting activity, that the
markings are not authorized, the Contracting Officer will furnish
the Contractor a written determination, which determination will
become the final agency decision regarding the appropriateness of
the markings unless the Contractor files suit in a court of
competent jurisdiction within 90 days of receipt of the Contracting
Officer's decision. The Government will continue to abide by the
markings under this paragraph (e)(1)(iii) until final resolution of
the matter either by the Contracting Officer's determination
becoming final (in which instance the Government will thereafter
have the right to cancel or ignore the markings at any time and the
data will no longer be made subject to any disclosure prohibitions),
or by final disposition of the matter by court decision if suit is
filed.
(2) The time limits in the procedures set forth in paragraph
(e)(1) of this clause may be modified in accordance with agency
regulations implementing the Freedom of Information Act (5 U.S.C.
552) if necessary to respond to a request thereunder.
(3) Except to the extent the Government's action occurs as the
result of final disposition of the matter by a court of competent
jurisdiction, the Contractor is not precluded by paragraph (e) of
the clause from bringing a claim, in accordance with the Disputes
clause of this contract, that may arise as the result of the
Government removing or ignoring authorized markings on data
delivered under this contract.
(f) Omitted or incorrect markings. (1) Data delivered to the
Government without any restrictive markings shall be deemed to have
been furnished with unlimited rights. The Government is not liable
for the disclosure, use, or reproduction of such data.
(2) If the unmarked data has not been disclosed without
restriction outside the Government, the Contractor may request,
within 6 months (or a longer time approved by the Contracting
Officer in writing for good cause shown) after delivery of the data,
permission to have authorized notices placed on the data at the
Contractor's expense. The Contracting Officer may agree to do so if
the Contractor--
(i) Identifies the data to which the omitted notice is to be
applied;
(ii) Demonstrates that the omission of the notice was
inadvertent;
(iii) Establishes that the proposed notice is authorized; and
(iv) Acknowledges that the Government has no liability for the
disclosure, use, or reproduction of any data made prior to the
addition of the notice or resulting from the omission of the notice.
(3) If data has been marked with an incorrect notice, the
Contracting Officer may--
(i) Permit correction of the notice at the Contractor's expense
if the Contractor identifies the data and demonstrates that the
correct notice is authorized; or
(ii) Correct any incorrect notices.
(g) Protection of limited rights data and restricted computer
software. (1) The Contractor may withhold from delivery qualifying
limited rights data or restricted computer software that are not
data identified in paragraphs (b)(1)(i), (ii), and (iii) of this
clause. As a condition to this withholding, the Contractor shall--
(i) Identify the data being withheld; and
(ii) Furnish form, fit, and function data instead.
(2) Limited rights data that are formatted as a computer data
base for delivery to the Government shall be treated as limited
rights data and not restricted computer software.
(3)-(4) [Reserved]
(h) Subcontracting. The Contractor shall obtain from its
subcontractors all data and rights therein necessary to fulfill the
Contractor's obligations to the Government under this contract. If a
subcontractor refuses to accept terms affording the Government those
rights, the Contractor shall promptly notify the Contracting Officer
of the refusal and shall not proceed with the subcontract award
without authorization in writing from the Contracting Officer.
(i) Relationship to patents or other rights. Nothing contained
in this clause shall imply a license to the Government under any
patent or be construed as affecting the scope of any license or
other right otherwise granted to the Government.
(End of clause)
Alternate I (Date). As prescribed in 27.409(b)(2), substitute
the following definition for Limited rights data in paragraph (a) of
the basic clause:
Limited rights data means data (other than computer software)
developed at private expense that embody trade secrets or are
commercial or financial and confidential or privileged.
Alternate II (Date). As prescribed in 27.409(b)(3), insert the
following paragraph (g)(3) in the basic clause:
(g)(3) Notwithstanding paragraph (g)(1) of this clause, the
contract may identify and specify the delivery of limited rights
data, or
[[Page 31815]]
the Contracting Officer may require by written request the delivery
of limited rights data that has been withheld or would otherwise be
entitled to be withheld. If delivery of that data is required, the
Contractor shall affix the following ``Limited Rights Notice'' to
the data and the Government will treat the data, subject to the
provisions of paragraphs (e) and (f) of this clause, in accordance
with the notice:
Limited Rights Notice (Date)
(a) These data are submitted with limited rights under
Government Contract No. ---- (and subcontract ----, if appropriate).
These data may be reproduced and used by the Government with the
express limitation that they will not, without written permission of
the Contractor, be used for purposes of manufacture nor disclosed
outside the Government; except that the Government may disclose
these data outside the Government for the following purposes, if
any; provided that the Government makes such disclosure subject to
prohibition against further use and disclosure: [Agencies may list
additional purposes as set forth in 27.40-2(c)(1) or if none, so
state.]
(b) This Notice shall be marked on any reproduction of these
data, in whole or in part.
(End of notice)
Alternate III (Date). As prescribed in 27.409(b)(4), insert the
following paragraph (g)(4) in the basic clause:
(g)(4)(i) Notwithstanding paragraph (g)(1) of this clause, the
contract may identify and specify the delivery of restricted
computer software, or the Contracting Officer may require by written
request the delivery of restricted computer software that has been
withheld or would otherwise be entitled to be withheld. If delivery
of that computer software is required, the Contractor shall affix
the following ``Restricted Rights Notice'' to the computer software
and the Government will treat the computer software, subject to
paragraphs (e) and (f) of this clause, in accordance with the
notice:
Restricted Rights Notice (Date)
(a) This computer software is submitted with restricted rights
under Government Contract No. ---- (and subcontract ----, if
appropriate). It may not be used, reproduced, or disclosed by the
Government except as provided in paragraph (b) of this Notice or as
otherwise expressly stated in the contract.
(b) This computer software may be--
(1) Used or copied for use with the computer(s) for which it was
acquired, including use at any Government installation to which such
computers may be transferred;
(2) Used or copied for use with a backup computer if any
computer for which it was acquired is inoperative;
(3) Reproduced for safekeeping (archives) or backup purposes;
(4) Modified, adapted, or combined with other computer software,
provided that the modified, adapted, or combined portions of the
derivative software incorporating any of the delivered, restricted
computer software shall be subject to the same restricted rights;
(5) Disclosed to and reproduced for use by support service
Contractors or their subcontractors in accordance with paragraphs
(b)(1) through (b)(4) of this notice; and
(6) Used or copied for use with a replacement computer.
(c) Notwithstanding the foregoing, if this computer software is
copyrighted computer software, it is licensed to the Government with
the minimum rights set forth in paragraph (b) of this notice.
(d) Any other rights or limitations regarding the use,
duplication, or disclosure of this computer software are to be
expressly stated in, or incorporated in, the contract.
(e) This notice shall be marked on any reproduction of this
computer software, in whole or in part.
(End of notice)
(ii) Where it is impractical to include the Restricted Rights
Notice on restricted computer software, the following short-form
notice may be used in lieu thereof:
Restricted Rights Notice Short Form (Date)
Use, reproduction, or disclosure is subject to restrictions set
forth in Contract No. ------ (and subcontract, if appropriate) with
------ (name of Contractor and subcontractor).
(End of notice)
(iii) If restricted computer software is delivered with the
copyright notice of 17 U.S.C. 401, it will be presumed to be
licensed to the Government without disclosure prohibitions, with the
minimum rights set forth in paragraph (b) of this clause.
Alternate IV (Date). As prescribed in 27.409(b)(5), substitute
the following paragraph (c)(1) for paragraph (c)(1) of the basic
clause:
(c) Copyright--(1) Data first produced in the performance of the
contract. Except as otherwise specifically provided in this
contract, the Contractor may assert copyright in any data first
produced in the performance of this contract. When asserting
copyright, the Contractor shall affix the applicable copyright
notice of 17 U.S.C. 401 or 402, and an acknowledgment of Government
sponsorship (including contract number), to the data when such data
are delivered to the Government, as well as when the data are
published or deposited for registration as a published work in the
U.S. Copyright Office. For data other than computer software, the
Contractor grants to the Government, and others acting on its
behalf, a paid-up, nonexclusive, irrevocable, worldwide license for
all such data to reproduce, prepare derivative works, distribute
copies to the public, and perform publicly and display publicly, by
or on behalf of the Government. For computer software, the
Contractor grants to the Government and others acting on its behalf,
a paid-up, nonexclusive, irrevocable worldwide license for all such
computer software to reproduce, prepare derivative works, and
perform publicly and display publicly (but not to distribute copies
to the public), by or on behalf of the Government.
Alternate V (Date). As prescribed in 27.409(b)(6), add the
following paragraph (j) to the basic clause:
(j) The Contractor agrees, except as may be otherwise specified
in this contract for specific data deliverables listed as not
subject to this paragraph, that the Contracting Officer may, up to
three years after acceptance of all deliverables under this
contract, inspect at the Contractor's facility any data withheld
pursuant to paragraph (g)(1) of this clause, for purposes of
verifying the Contractor's assertion of limited rights or restricted
rights status of the data or for evaluating work performance. When
the Contractor whose data are to be inspected demonstrates to the
Contracting Officer that there would be a possible conflict of
interest if a particular representative made the inspection, the
Contracting Officer shall designate an alternate inspector.
52.227-15 Representation of Limited Rights Data and Restricted
Computer Software.
As prescribed in 27.409(c), insert the following provision:
Representation of Limited Rights Data and Restricted Computer Software
(Date)
(a) This solicitation sets forth the Government's known delivery
requirements for data (as defined in the clause at 52.227-14, Rights
in Data--General). Any resulting contract may also provide the
Government the option to order additional data under the Additional
Data Requirements clause at 52.227-16, if included in the contract.
Any data delivered under the resulting contract will be subject to
the Rights in Data--General clause at 52.227-14 included in this
contract. Under the latter clause, a Contractor may withhold from
delivery data that qualify as limited rights data or restricted
computer software, and deliver form, fit, and function data instead.
The latter clause also may be used with its Alternates II and/or III
to obtain delivery of limited rights data or restricted computer
software, marked with limited rights or restricted rights notices,
as appropriate. In addition, use of Alternate V with this latter
clause provides the Government the right to inspect such data at the
Contractor's facility.
(b) By completing the remainder of this paragraph, the offeror
represents that it has reviewed the requirements for the delivery of
technical data or computer software and states [offeror check
appropriate block]--
( ) None of the data proposed for fulfilling the data delivery
requirements qualifies as limited rights data or restricted computer
software; or
( ) Data proposed for fulfilling the data delivery requirements
qualify as limited rights data or restricted computer software and
are identified as follows:
-----------------------------------------------------------------------
(c) Any identification of limited rights data or restricted
computer software in the offeror's response is not determinative of
the status of the data should a contract be awarded to the offeror.
(End of provision)
52.227-16 Additional Data Requirements.
As prescribed in 27.409(d), insert the following clause:
[[Page 31816]]
Additional Data Requirements (Date)
(a) In addition to the data (as defined in the clause at 52.227-
14, Rights in Data--General, or other equivalent included in this
contract) specified elsewhere in this contract to be delivered, the
Contracting Officer may, at any time during contract performance or
within a period of 3 years after acceptance of all items to be
delivered under this contract, order any data first produced or
specifically used in the performance of this contract.
(b) The Rights in Data--General clause or other equivalent
included in this contract is applicable to all data ordered under
this Additional Data Requirements clause. Nothing contained in this
clause shall require the Contractor to deliver any data the
withholding of which is authorized by the Rights in Data--General or
other equivalent clause of this contract, or data which are
specifically identified in this contract as not subject to this
clause.
(c) When data are to be delivered under this clause, the
Contractor will be compensated for converting the data into the
prescribed form, for reproduction, and for delivery.
(d) The Contracting Officer may release the Contractor from the
requirements of this clause for specifically identified data items
at any time during the 3-year period set forth in paragraph (a) of
this clause.
(End of clause)
52.227-17 Rights in Data--Special Works.
As prescribed in 27.409(e), insert the following clause:
Rights in Data--Special Works (DATE)
(a) Definitions. As used in this clause--
Data means recorded information, regardless of form or the media
on which it may be recorded. The term includes technical data and
computer software. The term does not include information incidental
to contract administration, such as financial, administrative, cost
or pricing, or management information.
Unlimited rights means the rights of the Government to use,
disclose, reproduce, prepare derivative works, distribute copies to
the public, and perform publicly and display publicly, in any manner
and for any purpose, and to have or permit others to do so.
(b) Allocation of Rights. (1) The Government shall have--
(i) Unlimited rights in all data delivered under this contract,
and in all data first produced in the performance of this contract,
except as provided in paragraph (c) of this clause.
(ii) The right to limit assertion of copyright in data first
produced in the performance of this contract, and to obtain
assignment of copyright in that data, in accordance with paragraph
(c)(1) of this clause.
(iii) The right to limit the release and use of certain data in
accordance with paragraph (d) of this clause.
(2) The Contractor shall have, to the extent permission is
granted in accordance with paragraph (c)(1) of this clause, the
right to assert claim to copyright subsisting in data first produced
in the performance of this contract.
(c) Copyright--(1) Data first produced in the performance of
this contract. (i) The Contractor shall not assert or authorize
others to assert any claim to copyright subsisting in any data first
produced in the performance of this contract without prior written
permission of the Contracting Officer. When copyright is asserted,
the Contractor shall affix the appropriate copyright notice of 17
U.S.C. 401 or 402 and acknowledgment of Government sponsorship
(including contract number) to the data when delivered to the
Government, as well as when the data are published or deposited for
registration as a published work in the U.S. Copyright Office. The
Contractor grants to the Government, and others acting on its
behalf, a paid-up, nonexclusive, irrevocable, worldwide license for
all delivered data to reproduce, prepare derivative works,
distribute copies to the public, and perform publicly and display
publicly, by or on behalf of the Government.
(ii) If the Government desires to obtain copyright in data first
produced in the performance of this contract and permission has not
been granted as set forth in paragraph (c)(1)(i) of this clause, the
Contracting Officer shall direct the Contractor to assign (with or
without registration), or obtain the assignment of, the copyright to
the Government or its designated assignee.
(2) Data not first produced in the performance of this contract.
The Contractor shall not, without prior written permission of the
Contracting Officer, incorporate in data delivered under this
contract any data not first produced in the performance of this
contract and which contain the copyright notice of 17 U.S.C. 401 or
402, unless the Contractor identifies such data and grants to the
Government, or acquires on its behalf, a license of the same scope
as set forth in paragraph (c)(1) of this clause.
(d) Release and use restrictions. Except as otherwise
specifically provided for in this contract, the Contractor shall not
use, release, reproduce, distribute, or publish any data first
produced in the performance of this contract, nor authorize others
to do so, without written permission of the Contracting Officer.
(e) Indemnity. The Contractor shall indemnify the Government and
its officers, agents, and employees acting for the Government
against any liability, including costs and expenses, incurred as the
result of the violation of trade secrets, copyrights, or right of
privacy or publicity, arising out of the creation, delivery,
publication, or use of any data furnished under this contract; or
any libelous or other unlawful matter contained in such data. The
provisions of this paragraph do not apply unless the Government
provides notice to the Contractor as soon as practicable of any
claim or suit, affords the Contractor an opportunity under
applicable laws, rules, or regulations to participate in the defense
of the claim or suit, and obtains the Contractor's consent to the
settlement of any suit or claim other than as required by final
decree of a court of competent jurisdiction; nor do these provisions
apply to material furnished to the Contractor by the Government and
incorporated in data to which this clause applies.
(End of clause)
52.227-18 [Amended]
17. Amend section 52.227-18 by removing from the introductory
paragraph of the clause ``27.409(j)'' and adding ``27.409(f)'' in its
place.
18. Revise section 52.227-19 and the section heading to read as
follows:
52.227-19 Commercial Computer Software License.
As prescribed in 27.409(g), insert the following clause:
Commercial Computer Software License (Date)
(a) Notwithstanding any contrary provisions contained in the
Contractor's standard commercial license or lease agreement, the
contractor agrees that the Government will have the rights that are
set forth in paragraph (c) of this clause to use, duplicate or
disclose any commercial computer software delivered under this
contract. The terms and provisions of this contract shall comply
with Federal laws and the Federal Acquisition Regulation.
(b)(1) The commercial computer software delivered under this
contract may not be used, reproduced or disclosed by the Government
except as provided in paragraph (c)(2) of this clause or as
expressly stated otherwise in this contract.
(2) The commercial computer software may be--
(i) Used or copied for use with the computer or computers for
which it was acquired, including use at any Government installation
to which such computer or computers may be transferred;
(ii) Used or copied for use with a backup computer if any
computer for which it was acquired is inoperative;
(iii) Reproduced for safekeeping (archives) or backup purposes;
(iv) Modified, adapted, or combined with other computer
software, provided that the modified, adapted, or combined portions
of the derivative software incorporating any of the delivered,
commercial computer software shall be subject to same restrictions
set forth in this contract;
(v) Disclosed to and reproduced for use by support service
Contractors or their subcontractors, subject to the same
restrictions set forth in this contract; and
(vi) Used or copied for use with a replacement computer.
(3) If the commercial computer software is otherwise available
without disclosure restrictions, the Contractor licenses it to the
Government without disclosure restrictions. The Contractor shall
affix a notice substantially as follows to any commercial computer
software delivered under this contract:
Notice--Notwithstanding any other lease or license agreement
that may pertain to, or accompany the delivery of, this computer
software, the rights of the Government regarding its use,
reproduction and disclosure are as set forth in Government Contract
No. ------:
(End of clause)
[[Page 31817]]
19. Amend section 52.227-20 as follows:
a. Revise the introductory paragraph and the date of the clause;
b. In paragraph (a), revise the introductory text and the
definitions ``Computer software'' and ``Technical data''; remove ``, as
used in this clause,'' from the following definitions: ``Data'',
``Form, fit, and function data'', ``Limited rights data'', ``Restricted
computer software'', ``SBIR data'', ``SBIR rights'', and ``Unlimited
rights''; and remove the word ``formulae'' from the definition ``Form,
fit, and function data'' and add ``formulas'' in its place; and
c. In paragraphs (b)(2)(iv) and (c)(2), remove the word
``subparagraph'' and add ``paragraph'' in its place.
The revised text reads as follows:
52.227-20 Rights in Data--SBIR Program.
As prescribed in 27.409(h), insert the following clause:
Rights in Data--SBIR Program (Date)
(a) Definitions. As used in this clause--
Computer software means--
(1) Computer programs that comprise a series of instructions,
rules, routines, or statements, regardless of the media in which
recorded, that allow or cause a computer to perform a specific
operation or series of operations; and
(2) Recorded information comprising source code listings, design
details, algorithms, processes, flow charts, formulas, and related
material that would enable the computer program to be produced,
created, or compiled. The term does not include computer data bases
or computer software documentation.
* * * * *
Technical data means recorded information (regardless of the
form or method of the recording) of a scientific or technical nature
(including computer data bases and computer software documentation)
relating to supplies procured by an agency. This term does not
include computer software or financial, administrative, cost or
pricing, or management data or other information incidental to
contract administration. Recorded information of a scientific or
technical nature that is included in computer data bases is also
technical data.
* * * * *
20. Revise section 52.227-21 to read as follows:
52.227-21 Technical Data Declaration, Revision, and Withholding of
Payment--Major Systems.
As prescribed in 27.409(j), insert the following clause:
Technical Data Declaration, Revision, and Withholding of
Payment--Major Systems (Date)
(a) Scope of declaration. The Contractor shall provide, in
accordance with 41 U.S.C. 418a (d)(7), the following declaration
with respect to all technical data that relate to a major system and
that are delivered or required to be delivered under this contract
or that are delivered within 3 years after acceptance of all items
(other than technical data) delivered under this contract unless a
different period is set forth in the contract. The Contracting
Officer may release the Contractor from all or part of the
requirements of this clause for specifically identified technical
data items at any time during the period covered by this clause.
(b) Technical data declaration. (1) All technical data that are
subject to this clause shall be accompanied by the following
declaration upon delivery:
TECHNICAL DATA DECLARATION (DATE)
The Contractor, ----------------, hereby declares that, to the best
of its knowledge and belief, the technical data delivered herewith
under Government contract No. ------ (and subcontract ------------,
if appropriate) are complete, accurate, and comply with the
requirements of the contract concerning such technical data.
(End of declaration)
(2) The Government may, at any time during the period covered by
this clause, direct correction of any deficiencies that are not in
compliance with contract requirements. The corrections shall be made
at the expense of the Contractor. Unauthorized markings on data
shall not be considered a deficiency for the purpose of this clause,
but will be treated in accordance with paragraph (e) of the Rights
in Data--General clause included in this contract.
(c) Technical data revision. The Contractor also shall, at the
request of the Contracting Officer, revise technical data that are
subject to this clause to reflect engineering design changes made
during the performance of this contract and affecting the form, fit,
and function of any item (other than technical data) delivered under
this contract. The Contractor may submit a request for an equitable
adjustment to the terms and conditions of this contract for any
revisions to technical data made pursuant to this paragraph.
(d) Withholding of payment. (1) At any time before final payment
under this contract the Contracting Officer may withhold payment as
a reserve up to an amount not exceeding $100,000 or 5 percent of the
amount of this contract, whichever is less, if the Contractor fails
to--
(i) Make timely delivery of the technical data;
(ii) Provide the declaration required by paragraph (b)(1) of
this clause;
(iii) Make the corrections required by paragraph (b)(2) of this
clause; or
(iv) Make revisions requested under paragraph (c) of this
clause.
(2) The Contracting Officer may withhold the reserve until the
Contractor has complied with the direction or requests of the
Contracting Officer or determines that the deficiencies relating to
delivered data arose out of causes beyond the control of the
Contractor and without the fault or negligence of the Contractor.
(3) The withholding of any reserve under this clause, or the
subsequent payment of the reserve, shall not be construed as a
waiver of any Government rights.
(End of clause)
52.227-22 [Amended]
21. In section 52.227-22, amend the introductory paragraph by
removing ``27.409(r)'' and adding ``27.409(k)'' in its place.
52.227-23 [Amended]
22. In section 52.227-23, amend the introductory paragraph by
removing ``27.409(s)'' and adding ``27.409(l)'' in its place.
[FR Doc. 03-12891 Filed 5-27-03; 8:45 am]