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TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED MATTERS

Subtitle D—Provisions Relating to Software and Technology

P. L. 117-81

Joint Explanatory Statement

(a) In General.--Section 2357 of title 10, United States Code, is amended--

(1) in subsection (b)--

(A) by inserting ``(1)'' before ``Any'';

(B) by adding at the end the following new paragraph:

``(2) The Secretary may deem the portion of the costs of the contractor described in paragraph (1) with respect to a designated system as allowable independent research and development costs under the regulations issued under section 2372 of this title if--

``(A) the designated system receives Milestone B approval; and

``(B) the Secretary determines that doing so would further the purposes of this section.''; and

(2) in subsection (c)--

(A) by redesignating paragraph (2) as paragraph (4); and

(B) by inserting after paragraph (1) the following new paragraphs:

``(2) The term `independent research and development costs' has the meaning given the term in section 31.205-18 of title 48, Code of Federal Regulations.

``(3) The term `Milestone B approval' has the meaning given the term in section 2366(e)(7) of this title.''.

(b) Conforming Regulations.--Not later than 120 days after the date of the enactment of this Act, the Secretary of Defense shall revise the Department of Defense Supplement to the Federal Acquisition Regulation to conform with section 2357 of title 10, United States Code, as amended by subsection (a).

The Senate amendment contained a provision (sec. 851) that would amend section 2357 of title 10, United States Code, to allow the contractor's share of costs for the technology protection features activities for certain designated systems to be treated as allowable independent research and development.

The House bill contained no similar provision.

The agreement includes the Senate provision.

S. 2792--Senate Report117-39

Technology protection features activities (sec. 851)

The committee recommends a provision that would amend section 2357 of title 10, United States Code, to allow the contractor's share of costs for the technology protection features activities for certain designated systems to be treated as allowable independent research and development. The committee notes that these technology protection features make it possible for defense contractors to export appropriate technologies to allied and friendly nations, with resultant economic and national security benefits. The committee believes that these kinds of activities will facilitate greater cooperation between industry and the Department of Defense in achieving the National Defense Strategy goal of deepening interoperability between the United States and partner nations.