Federal Register / Vol. 75, No. 88 / Friday, May 7, 2010 / Proposed Rules 25161 

rule does not impose additional 

information collection requirements that 

require the approval of the Office of 

Management and Budget under 44 

U.S.C. 3501, et seq. 

List of Subjects in 48 CFR Parts 211 and 

252 

Government procurement. 

Ynette R. Shelkin, 

Editor, Defense Acquisition Regulations 

System. 

Therefore, DoD proposes to amend 48 

CFR parts 211 and 252 as follows: 

1. The authority citation for 48 CFR 

parts 211 and 252 continues to read as 

follows: 

Authority: 41 U.S.C. 421 and 48 CFR 

Chapter 1. 

PART 211—DESCRIBING AGENCY 

NEEDS 

211.274–5 [Redesignated as 211.274–6] 

2. Redesignate section 211.274–5 as 

211.274–6. 

3. Add section 211.274–5 to read as 

follows: 

211.274–5 Policy for tagging, labeling, or 

marking of Government-furnished property. 

(a) It is DoD policy that the 

appropriate tagging, labeling, or 

permanent marking of Governmentfurnished property, based on DoD 

marking standards (MIL Standard 130) 

or other standards, be required for 

Government-furnished property items 

where the requiring activity determines 

that such items are subject to serialized 

item management (serially-managed 

items). 

(b) Exceptions. The contractor will 

not be required to tag, label, or mark 

Government-furnished property if such 

items were previously tagged, labeled, 

or marked. 

3. In newly redesignated 211.274–6, 

add paragraph (c) to read as follows: 

211.274–6 Contract clauses. 

* * * * * 

(c) Use the clause at 252.211–70YY, 

Tagging, Labeling, and Marking of 

Government-furnished Property, in 

solicitations and contracts that contain 

the clause at— 

(1) FAR 52.245–1, Government 

Property; or 

(2) FAR 52.245–2, Government 

Property Installation Operation 

Services. 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

4. Add section 252.211–70YY to read 

as follows: 

252.211–70YY Tagging, Labeling, and 

Marking of Government-furnished Property. 

As prescribed in 211.274–6(c), use the 

following clause: 

TAGGING, LABELING, AND MARKING OF 

GOVERNMENT–FURNISHED PROPERTY 

(DATE) 

(a) Definitions. As used in this clause— 

Government-furnished property means 

property in the possession of, or directly 

acquired by, the Government and 

subsequently furnished to the contractor for 

performance of a contract, including 

performance by subcontractors and at Prime 

Contractor Alternate locations. Governmentfurnished property includes reparables, e.g., 

spares and property furnished for repair, 

maintenance, overhaul, or modification; and 

Government-furnished material that is 

requisitioned from Government supply 

sources without reimbursement by the 

contractor. 

Serially-managed item means an item 

designated by DoD to be uniquely tracked, 

controlled, or managed in maintenance, 

repair, and/or supply systems by means of its 

serial number. 

(b) The Contractor shall tag, label, or mark 

Government-furnished property items 

identified in the contract when the requiring 

activity determines that such items are 

subject to serialized item management 

(serially-managed items). 

(c) Exceptions. Paragraph (b) of this clause 

does not apply to— 

(1) Government-furnished property that 

was previously marked; 

(2) Contractor-acquired property; 

(3) Property under any statutory leasing 

authority; 

(4) Property to which the Government has 

acquired a lien or title solely because of 

partial, advance, progress, or performancebased payments; 

(5) Intellectual property or software; or 

(6) Real property. 

(End of clause) 

[FR Doc. 2010–10763 Filed 5–6–10; 8:45 am] 

BILLING CODE 5001–08–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

[DFARS Case 2007–D003] 

48 CFR Parts 212, 227, and 252 

RIN 0750–AF84 

Defense Federal Acquisition 

Regulation Supplement; Presumption 

of Development at Private Expense 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Proposed rule with request for 

comments. 

SUMMARY: DoD proposes to amend the 

Defense Federal Acquisition Regulation 

Supplement (DFARS) to implement 

section 802(b) of the National Defense 

Authorization Act (NDAA) for Fiscal 

Year (FY) 2007 and section 815(a)(2) of 

the NDAA for FY 2008. This proposed 

rule implements special requirements 

and procedures related to the validation 

of a contractor’s or subcontractor’s 

asserted restrictions on technical data 

and computer software. 

DATES: Comments on the proposed rule 

should be submitted to the address 

shown below on or before July 6, 2010, 

to be considered in the formulation of 

the final rule. 

ADDRESSES: You may submit comments, 

identified by DFARS Case 2007–D003, 

using any of the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• E-mail: dfars@osd.mil. Include 

DFARS Case 2007–D003 in the subject 

line of the message. 

• Fax: 703–602–0350. 

• Mail: Defense Acquisition 

Regulations System, Attn: Ms. Amy 

Williams, OUSD(AT&L)DPAP(DARS), 

3060 Defense Pentagon, Room 3B855, 

Washington, DC 20301–3060. 

All comments received will be posted 

generally without change to http:// 

www.regulations.gov, including any 

personal information provided. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Amy Williams, 703–602–0328. 

SUPPLEMENTARY INFORMATION: 

A. Background 

Section 802(b) of the National Defense 

Authorization Act (NDAA) for Fiscal 

Year (FY) 2007 (Pub. L. 109–364) 

modified 10 U.S.C. 2321(f) with regard 

to the presumption of development at 

private expense for major systems; and 

section 815(a)(2) of the NDAA for FY 

2008 (Pub. L. 110–181) revised 10 

U.S.C. 2321(f)(2) to exempt 

commercially available off-the-shelf 

items from the requirements that section 

802(b) had established for major 

systems. This proposed rule implements 

special requirements and procedures 

related to the validation of a contractor’s 

or subcontractor’s asserted restrictions 

on technical data and computer 

software. More specifically, the 

proposed rule affects these validation 

procedures in the context of two special 

categories of items: Commercial items, 

(including commercially available offthe-shelf items); and major systems 

(including subsystems and components 

of major systems). 


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1. Procedures and Presumptions 

Regarding Development at Private 

Expense—Technical Data 

The validation of asserted restrictions 

on technical data is based on statutory 

requirements, codified primarily at 10 

U.S.C. section 2321. In 1994, the Federal 

Acquisition Streamlining Act (Pub. L. 

103–355) revised these requirements to 

include specialized presumptions and 

procedures for technical data related to 

commercial items. For discussion 

purposes, these specialized 

requirements will be referred to as the 

‘‘Commercial Rule’’ (see 10 U.S.C. 

2320(b)(1) and 2321(f)). 

Under the Commercial Rule, a 

contracting officer is required to 

presume that a commercial item has 

been developed entirely at private 

expense, unless shown otherwise in 

accordance with the procedures at 10 

U.S.C. 2321(f). The detailed procedures 

at 10 U.S.C. 2321(f)(1) require the 

contracting officer to presume that the 

asserted restrictions have been justified 

(on the basis that the item was 

developed exclusively at private 

expense), whether or not the contractor 

or subcontractor submits a justification 

in response to the challenge notice 

issued by the contracting officer. The 

contracting officer’s challenge may be 

sustained only if information provided 

by DoD demonstrates that the item was 

not developed exclusively at private 

expense. 

Section 802(b) of the FY 2007 NDAA 

established another set of procedures for 

technical data related to major systems 

(including subsystems or components 

thereof). For discussion purposes, these 

specialized requirements will be 

referred to as the ‘‘Major Systems Rule.’’ 

Under the Major Systems Rule, codified 

at 10 U.S.C. 2321(f)(2), a contracting 

officer’s challenge to asserted 

restrictions on technical data relating to 

a major system shall be sustained unless 

the contractor or subcontractor submits 

information demonstrating that the item 

was developed exclusively at private 

expense. In the initial statutory 

implementation of section 802(b), the 

Major Systems Rule also covered all 

contracts for commercial items (i.e., 

serving as a complete exception to the 

otherwise applicable Commercial Rule). 

However, section 815(a)(2) of the FY 

2008 NDAA altered the relationship 

between these two special rules in cases 

of overlap—revising the Major Systems 

Rule so that it does not apply to 

commercially available off-the-shelf 

(COTS) items (as defined at 41 U.S.C. 

431(c)). Since COTS items are a subtype 

of commercial items, this change results 

in COTS items being governed by the 

Commercial Rule in all cases, regardless 

of whether the COTS items are included 

in a major system. 

The proposed implementation in the 

DFARS of these special rules for 

technical data is modeled closely after 

this two-pronged statutory scheme. The 

detailed requirements for each special 

rule, and the relationship between the 

two rules, are consolidated in the 

regulatory coverage at 227.7103–13(c), 

and in the associated clause language at 

252.227–7037(b). In each case, the 

implementing language combines the 

relevant preexisting DFARS coverage 

(e.g., for the Commercial Rule, or for 

validation procedures generally) with 

the additional language necessary to 

implement the new Major Systems Rule 

and to clarify which rule governs in 

cases of overlap. 

For example, preexisting DFARS 

coverage for the Commercial Rule at 

227.7102 is relocated primarily to new 

227.7103–13(c)(2), where it is combined 

with new language to address the Major 

Systems Rule (new paragraph (c)(2)(ii)). 

The language at proposed new 

227.7103–13(c)(1) is a combination of 

preexisting language regarding initiation 

of challenges from preexisting 227.7102 

and 227.7103–13(c) (the latter is 

redesignated as paragraph (d)). 

Several other conforming or clarifying 

revisions are included. Preexisting 

language from 227.7102 is adapted to 

serve as proposed new subsection 

227.7102–3, which highlights and crossreferences the regulatory coverage for 

validation of asserted restrictions on 

technical data for commercial items, 

which is now consolidated at 227.7103– 

13. The prescriptive language at 

proposed 227.7102–4 and 227.7103–6(a) 

was revised for clarity and consistency. 

The language ‘‘other than a failure to 

respond under a contract for 

commercial items’’ was deleted from 

252.227–7037(f) in order to eliminate 

confusion as to when a contracting 

officer is required to issue a final 

decision. The contracting officer must 

issue a final decision, even when the 

contractor or subcontractor fails to 

respond to a challenge notice under a 

contract for commercial items. 

Paragraph (f) of 252.227–7037 was 

amended to state positively that the 

contracting officer’s final decision will 

adhere to the requirements set forth in 

paragraph (b) of the clause. 

2. Flowdown of Requirements to 

Subcontracts for Commercial Items— 

Technical Data 

The Federal Acquisition Streamlining 

Act (FASA) requires the FAR to identify 

statutes that are not to apply to contracts 

or subcontracts for commercial items 

(see FAR 12.503 and 12.504). The 

corresponding DFARS implementation 

of these requirements at 212.503 and 

212.504 made 10 U.S.C. 2320 and 2321 

inapplicable to subcontracts for 

commercial items, even though these 

requirements remained applicable to 

such acquisitions at the prime contract 

level. Accordingly, the associated 

technical data clauses used in prime 

contracts have not been flowed down to 

lower tier subcontracts for commercial 

items, pursuant to current 227.7102–3, 

252.227–7013(k)(2), and 252.227– 

7037(l). DoD has reviewed the merits of 

this approach and has determined that 

these statutory requirements should 

remain applicable to acquisitions of 

technical data related to commercial 

items regardless of whether that data is 

provided by the prime contractor or by 

a lower tier subcontractor. 

It is well established policy and 

practice in Federal and DoD 

acquisitions that the treatment of 

intellectual property rights creates a 

special, direct, relationship between the 

Government and subcontractors (at any 

tier). For example, the Government’s 

license rights may be granted directly 

from the subcontractor to the 

Government, and the Government and 

subcontractor are allowed to transact 

business directly with one another on 

issues related to the subcontractor’s 

intellectual property (such as delivery of 

technical data directly to the 

Government, and regarding the 

validation of asserted restrictions). 

Detailed review of the statutory 

provisions also supports the conclusion 

that these requirements are intended to 

apply to all acquisitions of technical 

data, including both commercial and 

noncommercial, and at both the prime 

contract level and lower tier subcontract 

level. 10 U.S.C. 2320 and 2321 have 

always applied expressly to prime 

contractors and subcontractors. When 

FASA amended these sections to 

address special requirements for 

technical data related to commercial 

items (e.g., the Commercial Rule 

discussed previously), the statutory 

amendments retained this approach, 

explicitly applying at the prime contract 

and subcontract levels (see 10 U.S.C. 

2320(a) and (b)(1), and 2321(f)). 

This congressional intent is reinforced 

by the recent amendments to these 

statutes. Section 802(b) of the FY07 

NDAA, which created the new Major 

Systems Rule, expressly and explicitly 

cited application to prime contractors 

and subcontractors ‘‘whether or not 

under a contract for commercial items.’’ 

Section 815(a)(2) retained all of the 

language that expressly applies to 

subcontracts, and revised the language 


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only to clarify that the Major Systems 

Rule is not intended to apply to COTS 

items, which, under the existing 

statutory language, would be covered 

under the Commercial Rule at both the 

prime contract and subcontract level. 

Accordingly, this proposed rule 

revises section 212.504 to eliminate 10 

U.S.C. 2320 and 2321 from the list of 

statutes that are inapplicable to 

subcontracts for commercial items, and 

makes corresponding changes to the 

flowdown requirements at 227.7102–4, 

and to the associated clauses at 

252.227–7013(k)(2), –7015(e), and 

–7037(l). 

3. Procedures and Presumptions 

Regarding Development at Private 

Expense—Computer Software 

Although 10 U.S.C. 2320 and 2321 

apply only to technical data and not to 

computer software (which is expressly 

excluded from the definition of 

technical data), it is longstanding 

Federal and DoD policy and practice to 

apply the same or analogous 

requirements to computer software, 

whenever appropriate. Many issues are 

common to both technical data and 

computer software, and in such cases, 

conformity of coverage between 

technical data and computer software is 

desirable. 

For example, although the DFARS 

provides separate coverage for technical 

data and computer software—subparts 

227.71 and 227.72, respectively—the 

policies and procedures are identical or 

analogous in most respects. Regarding 

the procedures for validation of asserted 

restrictions on computer software, the 

DFARS adapts the technical data 

procedures only for application to 

noncommercial computer software (see 

227.7203–13 and 252.227–7019), but 

provides no similar or analogous 

coverage for commercial computer 

software (see 227.7202). This 

applicability model is used to guide the 

implementation of revisions analogous 

to those discussed previously for 

technical data (i.e., analogous revisions 

are made to the validation procedures 

only for noncommercial technologies). 

Accordingly, it is only the new Major 

Systems Rule that is applicable to, and 

implemented for, the validation 

procedures for noncommercial 

computer software. These new 

procedures are added at proposed 

227.7203–13(d) and the associated 

clause at 252.227–7019(f). In each case, 

the paragraph numbers in the affected 

coverage are revised to incorporate the 

new paragraph. In addition, a 

conforming amendment is also made at 

252.227–7019(g)(5) to state positively 

that the contracting officer’s final 

decision will adhere to the new 

requirements. 

This rule was subject to Office of 

Management and Budget review under 

Executive Order 12866, dated 

September 30, 1993. 

B. Regulatory Flexibility Act 

DoD does not expect this 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., 

based on the historically low incidence 

of formal challenges to validate asserted 

restrictions by small businesses on 

major systems or subsystems or 

components thereof. Therefore, DoD has 

not performed an initial regulatory 

flexibility analysis. DoD invites 

comments from small business concerns 

and other interested parties on the 

expected impact of this rule on small 

entities. 

DoD will also consider comments 

from small entities concerning the 

existing regulations in subparts affected 

by this rule in accordance with 5 U.S.C. 

610. Interested parties must submit such 

comments separately and should cite 5 

U.S.C. 610 (DFARS Case 2007–D003) in 

correspondence. 

C. Paperwork Reduction Act 

The Paperwork Reduction Act does 

not apply because the proposed changes 

to the DFARS do not create new 

information collection requirements, 

and do not affect the scope of existing 

information collection requirements in a 

manner that may require the approval of 

the Office of Management and Budget 

under 44 U.S.C. 3501, et seq. 

List of Subjects in 48 CFR Parts 212, 

227, and 252 

Government procurement. 

Ynette R. Shelkin, 

Editor, Defense Acquisition Regulations 

System. 

Therefore, DoD proposes to amend 48 

CFR parts 212, 227, and 252 as follows: 

1. The authority citation for 48 CFR 

parts 212, 227, and 252 continues to 

read as follows: 

Authority: 41 U.S.C. 421 and 48 CFR 

chapter 1. 

PART 212—ACQUISITION OF 

COMMERCIAL ITEMS 

212.504 [Amended] 

2. Amend section 212.504 by 

removing and reserving paragraphs 

(a)(v) and (a)(vi). 

PART 227—PATENTS, DATA, AND 

COPYRIGHTS 

227.7102 [Removed] 

3. Remove section 227.7102. 

227.7102–3 [Redesignated as 227.7102–4] 

4. Redesignate section 227.7102–3 as 

section 227.7102–4. 

5. Add new section 227.7102–3 to 

read as follows: 

227.7102–3 Government right to review, 

verify, challenge and validate asserted 

restrictions. 

Follow the procedures at 227.7103–13 

and the clause at 252.227–7037, 

Validation of Restrictive Markings on 

Technical Data, regarding the validation 

of asserted restrictions on technical data 

related to commercial items. 

6. Revise newly designated section 

227.7102–4 to read as follows: 

227.7102–4 Contract clause. 

(a)(1) Except as provided in paragraph 

(b) of this subsection, use the clause at 

252.227–7015, Technical Data– 

Commercial Items, in all solicitations 

and contracts when the Contractor will 

be required to deliver technical data 

pertaining to commercial items, 

components, or processes. 

(2) Use the clause at 252.227–7015 

with its Alternate I in contracts for the 

development or delivery of a vessel 

design or any useful article embodying 

a vessel design. 

(b) In accordance with the clause 

prescription at 227.7103–6(a), use the 

clause at 252.227–7013, Rights in 

Technical Data—Noncommercial Items, 

in lieu of the clause at 252.227–7015 if 

the Government has paid or will pay 

any portion of the development costs of 

a commercial item. 

(c) Use the clause at 252.227–7037, 

Validation of Restrictive Markings on 

Technical Data, in all solicitations and 

contracts for commercial items that 

include the clause at 252.227–7015 or 

the clause at 252.227–7013. 

7. Amend section 227.7103–6 by 

revising paragraph (a) to read as follows: 

227.7103–6 Contract clauses. 

(a) Use the clause at 252.227–7013, 

Rights in Technical Data— 

Noncommercial Items, in solicitations 

and contracts when the successful 

offeror(s) will be required to deliver to 

the Government technical data 

pertaining to noncommercial items, or 

pertaining to commercial items for 

which the Government has paid or will 

pay any portion of the development 

costs. Do not use the clause when the 

only deliverable items are computer 

software or computer software 

documentation (see 227.72), commercial 


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items developed exclusively at private 

expense (see 227.7102–4), existing 

works (see 227.7105), special works (see 

227.7106), or when contracting under 

the Small Business Innovation Research 

Program (see 227.7104). Except as 

provided in 227.7107–2, do not use the 

clause in architect-engineer and 

construction contracts. 

* * * * * 

8. Amend section 227.7103–13 as 

follows: 

a. By redesignating paragraph (c) as 

paragraph (d); 

b. By adding new paragraph (c); 

c. By revising newly redesignated 

paragraph (d) introductory text; 

d. By revising the first sentence of 

(d)(2)(i); and 

e. By revising paragraph (d)(4). 

The addition and revisions read as 

follows: 

227.7103–13 Government right to review, 

verify, challenge and validate asserted 

restrictions. 

* * * * * 

(c) Challenge considerations and 

presumption. (1) Requirements to 

initiate a challenge. Contracting officers 

shall have reasonable grounds to 

challenge the validity of an asserted 

restriction. Before issuing a challenge to 

an asserted restriction, carefully 

consider all available information 

pertaining to the assertion. The 

contracting officer shall not challenge a 

contractor’s assertion that a commercial 

item, component, or process was 

developed exclusively at private 

expense unless the Government can 

demonstrate that it contributed to 

development of the item, component or 

process. 

(2) Presumption regarding 

development exclusively at private 

expense. 10 U.S.C. Sections 2320(b)(1) 

and 2321(f) establish a presumption and 

procedures regarding validation of 

asserted restrictions for technical data 

related to commercial items, and to 

major systems, on the basis of 

development exclusively at private 

expense. 

(i) Commercial items. For 

commercially available off-the-shelf 

items (defined at 41 U.S.C. Section 

431(c)) in all cases, and for all other 

commercial items except as provided in 

paragraph (c)(2)(ii) of this section, 

contracting officers shall presume that 

the items were developed exclusively at 

private expense whether or not a 

contractor submits a justification in 

response to a challenge notice. When a 

challenge is warranted, a contractor’s or 

subcontractor’s failure to respond to the 

challenge notice cannot be the sole basis 

for issuing a final decision denying the 

validity of an asserted restriction. 

(ii) Major systems. The presumption 

of development exclusively at private 

expense does not apply to major 

systems or subsystems or components 

thereof, except for commercially 

available off-the-shelf items (which are 

governed by paragraph (c)(2)(i) of this 

section). When the contracting officer 

challenges an asserted restriction 

regarding technical data for a major 

system or a subsystem or component 

thereof on the basis that the technology 

was not developed exclusively at 

private expense, the contracting officer 

shall sustain the challenge unless 

information provided by the contractor 

or subcontractor demonstrates that the 

item was developed exclusively at 

private expense. 

(d) Challenge and validation. All 

challenges shall be made in accordance 

with the provisions of the clause at 

252.227–7037, Validation of Restrictive 

Markings on Technical Data. 

* * * * * 

(2) * * * 

(i) After consideration of the 

situations described in paragraph (d)(3) 

of this subsection, contracting officers 

may request the person asserting a 

restriction to furnish a written 

explanation of the facts and supporting 

documentation for the assertion in 

sufficient detail to enable the 

contracting officer to ascertain the basis 

of the restrictive markings . * * * 

* * * * * 

(4) Challenge notice. The contracting 

officer will not issue a challenge notice 

unless there are reasonable grounds to 

question the validity of an assertion. 

The contracting officer may challenge 

an assertion whether or not supporting 

documentation was requested under 

paragraph (d)(2) of this section. 

Challenge notices shall be in writing 

and issued to the contractor or, after 

consideration of the situations described 

in paragraph (d)(3) of this section, the 

person asserting the restriction. The 

challenge notice shall include the 

information in paragraph (e) of the 

clause at 252.227–7037. 

* * * * * 

9. Revise section 227.7203–13 by 

redesignating paragraphs (d), (e), and (f) 

as (e), (f), and (g) respectively; and by 

adding new paragraph (d) to read as 

follows: 

227.7203–13 Government right to review, 

verify, challenge and validate asserted 

restrictions. 

* * * * * 

(d) Major systems. When the 

contracting officer challenges an 

asserted restriction regarding 

noncommercial computer software for a 

major system or a subsystem or 

component thereof on the basis that the 

computer software was not developed 

exclusively at private expense, the 

contracting officer shall sustain the 

challenge unless information provided 

by the contractor or subcontractor 

demonstrates that the computer 

software was developed exclusively at 

private expense. 

* * * * * 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

8. Amend section 252.227–7013 by 

revising the clause date and paragraph 

(k)(2) to read as follows: 

252.227–7013 Rights in Technical Data— 

Noncommercial Items. 

* * * * * 

RIGHTS IN TECHNICAL DATA— 

NONCOMMERCIAL ITEMS (DATE) 

* * * * * 

(k) * * * 

(2) Whenever any technical data is to be 

obtained from a subcontractor or supplier for 

delivery to the Government under this 

contract, the Contractor shall use this same 

clause in the subcontract or other contractual 

instrument, and require its subcontractors or 

suppliers to do so, without alteration, except 

to identify the parties. No other clause shall 

be used to enlarge or diminish the 

Government’s, the Contractor’s, or a highertier subcontractor’s or supplier’s rights in a 

subcontractor’s or supplier’s technical data. 

* * * * * 

9. Amend section 252.227–7015 by 

revising the clause date and the 

introductory text, and adding new 

paragraph 227.7015(e) to read as 

follows: 

252.227–7015 Technical Data-Commercial 

Items. 

As prescribed in 227.7102–4(a)(1), use 

the following clause: 

TECHNICAL DATA—COMMERCIAL ITEMS 

(DATE) 

* * * * * 

(e) Applicability to subcontractors or 

suppliers. 

(1) The Contractor shall recognize and 

protect the rights afforded its subcontractors 

and suppliers under 10 U.S.C. 2320 and 10 

U.S.C. 2321. 

(2) Whenever any technical data will be 

obtained from a subcontractor or supplier for 

delivery to the Government under this 

contract, the Contractor shall use this same 

clause in the subcontract or other contractual 

instrument, and require its subcontractors or 

suppliers to do so, without alteration, except 

to identify the parties. 

(End of clause) 


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10. Amend section 252.227–7019 by 

revising the clause date; redesignating 

paragraphs (f) through (i) as (g) through 

(j) respectively; adding new paragraph 

(f); and revising newly redesignated 

paragraphs (g)(5), (h)(1), and (h)(3) to 

read as follows: 

Validation of Asserted Restrictions— 

Computer Software 

* * * * * 

VALIDATION OF ASSERTED 

RESTRICTIONS—COMPUTER SOFTWARE 

(DATE) 

* * * * * 

(f) Major systems. When the Contracting 

Officer challenges an asserted restriction 

regarding noncommercial computer software 

for a major system or a subsystem or 

component thereof on the basis that the 

computer software was not developed 

exclusively at private expense, the 

Contracting Officer shall sustain the 

challenge unless information provided by the 

Contractor or subcontractor demonstrates 

that the computer software was developed 

exclusively at private expense. 

(g) * * * 

(5) If the Contractor fails to respond to the 

Contracting Officer’s request for information 

or additional information under paragraph 

(g)(1) of this clause, the Contracting Officer 

shall issue a final decision, in accordance 

with paragraph (f) of this clause and the 

Disputes clause of this contract, pertaining to 

the validity of the asserted restriction. 

* * * * * 

(h) * * * 

(1) The Government agrees that, 

notwithstanding a Contracting Officer’s final 

decision denying the validity of an asserted 

restriction and except as provided in 

paragraph (h)(3) of this clause, it will honor 

the asserted restriction— 

* * * * * 

(3) The agency head, on a nondelegable 

basis, may determine that urgent or 

compelling circumstances do not permit 

awaiting the filing of suit in an appropriate 

court, or the rendering of a decision by a 

court of competent jurisdiction or Board of 

Contract Appeals. In that event, the agency 

head will notify the Contractor of the urgent 

or compelling circumstances. 

Notwithstanding paragraph (h)(1) of this 

clause, the Contractor agrees that the agency 

may use, modify, reproduce, release, 

perform, display, or disclose computer 

software marked with government purpose 

legends for any purpose, and authorize others 

to do so; or restricted or special license rights 

for government purposes only. The 

Government agrees not to release or disclose 

such software unless, prior to release or 

disclosure, the intended recipient is subject 

to the use and non-disclosure agreement at 

227.7103–7 of the Defense Federal 

Acquisition Regulation Supplement 

(DFARS), or is a Government contractor 

receiving access to the software for 

performance of a Government contract that 

contains the clause at DFARS 252.227–7025, 

Limitations on the Use or Disclosure of 

Government-Furnished Information Marked 

with Restrictive Legends. The agency head’s 

determination may be made at any time after 

the date of the Contracting Officer’s final 

decision and shall not affect the Contractor’s 

right to damages against the United States, or 

other relief provided by law, if its asserted 

restrictions are ultimately upheld. 

* * * * * 

11. Amend section 252.227–7037 by 

revising the clause date and revising 

paragraphs (b), (c), (f), and (l) to read as 

follows: 

* * * * * 

252.227–7037 Validation of Restrictive 

Markings on Technical Data. 

* * * * * 

VALIDATION OF RESTRICTIVE 

MARKINGS ON TECHNICAL DATA (DATE) 

* * * * * 

(b) Presumption regarding development 

exclusively at private expense. 

(1) Commercial items. For commercially 

available off-the-shelf items (defined at 41 

U.S.C. Section 431(c)) in all cases, and for all 

other commercial items except as provided in 

paragraph (b)(2) of this clause, the 

Contracting Officer shall presume that a 

Contractor’s asserted use or release 

restrictions are justified on the basis that the 

item, component, or process was developed 

exclusively at private expense. The 

Contracting Officer shall not challenge such 

assertions unless information provided by 

the Contracting Officer demonstrates that the 

item, component, or process was not 

developed exclusively at private expense. 

(2) Major systems. The presumption of 

development exclusively at private expense 

does not apply to major systems or 

subsystems or components thereof, except for 

commercially available off-the-shelf items 

(which are governed by paragraph (b)(1) of 

this clause). When the Contracting Officer 

challenges an asserted restriction regarding 

technical data for a major system or a 

subsystem or component thereof on the basis 

that the item, component, or process was not 

developed exclusively at private expense, the 

Contracting Officer shall sustain the 

challenge unless information provided by the 

Contractor or subcontractor demonstrates 

that the item, component, or process was 

developed exclusively at private expense. 

(c) Justification. The Contractor or 

subcontractor at any tier is responsible for 

maintaining records sufficient to justify the 

validity of its markings that impose 

restrictions on the Government and others to 

use, duplicate, or disclose technical data 

delivered or required to be delivered under 

the contract or subcontract. Except as 

provided in paragraph (b) of this clause, the 

Contractor or subcontractor shall be prepared 

to furnish to the Contracting Officer a written 

justification for such restrictive markings in 

response to a challenge under paragraph (e) 

of this clause. 

* * * * * 

(f) Final decision when Contractor or 

subcontractor fails to respond. Upon a failure 

of a Contractor or subcontractor to submit 

any response to the challenge notice, the 

Contracting Officer shall issue a final 

decision to the Contractor or subcontractor in 

accordance with paragraph (b) of this clause 

and the Disputes clause of this contract 

pertaining to the validity of the asserted 

restriction. This final decision shall be issued 

as soon as possible after the expiration of the 

time period of paragraph (e)(1)(ii) or (e)(2) of 

this clause. Following issuance of the final 

decision, the Contracting Officer shall 

comply with the procedures in paragraphs 

(g)(2)(ii) through (iv) of this clause. 

* * * * * 

(l) Flowdown. The Contractor or 

subcontractor agrees to insert this clause in 

contractual instruments with its 

subcontractors or suppliers at any tier 

requiring the delivery of technical data. 

(End of clause) 

[FR Doc. 2010–10764 Filed 5–6–10; 8:45 am] 

BILLING CODE 5001–08–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

[DFARS Case 2008–D027] 

48 CFR Parts 215, 234, 242, and 252 

Defense Federal Acquisition 

Regulation Supplement; Cost and 

Software Data Reporting System 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Proposed rule with request for 

comments. 

SUMMARY: DoD proposes to amend the 

Defense Federal Acquisition Regulation 

Supplement (DFARS) to set forth DoD 

Cost and Software Data Reporting 

system requirements for major defense 

acquisition programs and major 

automated information system 

programs. 

DATES: Comments on the proposed rule 

should be submitted in writing to the 

address shown below on or before July 

6, 2010, to be considered in the 

formation of the final rule. 

ADDRESSES: You may submit comments, 

identified by DFARS Case 2008–D027, 

using any of the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• E-mail: dfars@osd.mil. Include 

DFARS Case 2008–D027 in the subject 

line of the message. 

• Fax: 703–602–0350. 

• Mail: Defense Acquisition 

Regulations System, Attn: Ms. Mary 

Overstreet, OUSD(AT&L)DPAP(DARS), 

Room 3B855, 3060 Defense Pentagon, 

Washington, DC 20301–3060. 

Comments received generally will be 

posted without change to http:// 


jlentini on DSKJ8SOYB1PROD with PROPOSALS