[Senate Report 104-194]
[From the U.S. Government Publishing Office]



   104th Congress 1st            SENATE                 Report
         Session
                                                       104-194
_______________________________________________________________________


                                                       Calendar No. 294

 
              TECHNOLOGY TRANSFER IMPROVEMENTS ACT OF 1995

                               __________

                              R E P O R T

                                 OF THE

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 1164



                                     


               December 20, 1995.--Ordered to be printed
       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                      one hundred fourth congress
                             first session

  LARRY PRESSLER, South Dakota, 
             Chairman
ERNEST F. HOLLINGS, South Carolina   TED STEVENS, Alaska
DANIEL K. INOUYE, Hawaii             JOHN McCAIN, Arizona
WENDELL H. FORD, Kentucky            CONRAD BURNS, Montana
J. JAMES EXON, Nebraska              SLADE GORTON, Washington
JOHN D. ROCKEFELLER IV, West VirginiaTRENT LOTT, Mississippi
JOHN F. KERRY, Massachusetts         KAY BAILEY HUTCHISON, Texas
JOHN B. BREAUX, Louisiana            OLYMPIA SNOWE, Maine
RICHARD H. BRYAN, Nevada             JOHN ASHCROFT, Missouri
BYRON L. DORGAN, North Dakota        BILL FRIST, Tennessee
  Patric G. Link, Chief of Staff
Kevin G. Curtin, Democratic Chief 
    Counsel and Staff Director
                                                       Calendar No. 294
104th Congress                                                   Report
                                 SENATE

 1st Session                                                    104-194
_______________________________________________________________________


              TECHNOLOGY TRANSFER IMPROVEMENTS ACT OF 1995
                                _______


               December 20, 1995.--Ordered to be printed

_______________________________________________________________________


      Mr. Pressler, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                         [To accompany S. 1164]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill joint resolution deg. (S. 
1164) TITLE deg. ``A Bill to amend the Stevenson-
Wydler Technology Innovation Act of 1980 with respect to 
inventions made under cooperative research and development 
agreements, and for other purposes'', having considered the 
same, reports favorably thereon without deg. with 
amendments and recommends that the bill joint 
resolution deg. (as amended) do pass.

                       Purpose of the Legislation

  The purpose of the reported bill is to promote greater 
transfer and commercialization of the technology from our 
system of 700 Federal laboratories and to increase joint 
research between the Federal laboratories and the private 
sector by increasing the incentives for private companies to 
enter into cooperative research and development agreements 
(sometimes called CRADAs) with Federal laboratories pursuant to 
the Stevenson-Wydler Technology Innovation Act of 1980, as 
amended. The reported bill seeks to achieve that purpose by 
guaranteeing that industry partners to such agreements be 
entitled to certain intellectual property rights to inventions 
generated by the joint research conducted under the agreements 
and by enhancing the financial incentives and rewards given to 
Federal laboratory scientists for technology that results in 
marketable products.

                          Background and Needs

  Federal laboratory technology transfer.--Federal departments 
and agencies operate several hundred laboratories, ranging from 
small research units to a few large laboratories with annual 
budgets of $1 billion or more each. These laboratories provide 
research and development (R&D) support for a wide range of 
Government missions, including defense, space, aeronautics, 
agriculture, health, energy, and measurements and standards. 
While the main purpose of these laboratories remains support of 
their Government mission activities, they also possess 
expertise, technology, and facilities that can be useful to 
private industry, state governments, and others.
  In order to get the most national value from these 
laboratories, Congress has passed legislation to encourage 
agencies to transfer, when appropriate, unclassified technology 
and expertise to the private sector and the states.
  The key law in this area is the Stevenson-Wydler Technology 
Innovation Act of 1980, as amended. The original 1980 law (P.L. 
96-480) required Federal laboratories to take an active role in 
technical transfer and established technology transfer offices, 
called Offices of Research and Technology Applications, at all 
major Federal laboratories. These offices proved useful, but it 
soon became apparent that effective technology transfer often 
requires more than simply transferring technical reports or 
licensing existing Government patents. Few ideas or inventions 
in Federal laboratories are sufficiently developed to be 
immediately useful to the private sector. Some may require 
further research while others may be overdeveloped or too 
expensive to the private sector.
  In the mid-1980s, a bipartisan consensus opinion developed 
that it was in the public interest to permit companies to work 
directly with the Federal scientists and engineers who 
developed the idea or invention in the first place. This was 
deemed necessary in order to refine laboratory innovations and 
inventions to the point where they have a chance to succeed in 
the commercial marketplace. This consensus led the Reagan 
Administration to propose legislation during the 99th Congress 
to create a new way in which companies, state governments, and 
others could conduct joint research projects with Federal 
laboratories. These projects could refine existing patented 
inventions, lead to new inventions, or give companies access to 
unique Federal facilities and expertise. Members of Congress 
from both parties introduced related legislation. Ensuing 
deliberations in Congress led to the Federal Technology 
Transfer Act of 1986 (P.L. 99-502), which consisted of a series 
of amendments to the Stevenson-Wydler Act.
  The 1986 law authorizes Federal agencies to permit their 
Government-owned, Government-operated laboratories (that is, 
civil service-operated laboratories) to enter into cooperative 
research and development agreements (CRADAs) for joint research 
projects with companies and other ``collaborating parties.'' 
Under a CRADA Federal laboratories may contribute personnel, 
intellectual property, and facilities to a joint research 
project, while the collaborating party may contribute funding 
as well as personnel, services, and property. The law expressly 
prohibits the laboratory from providing direct funding to its 
private sector partner.
  The CRADA specifies the main terms and conditions of the 
joint research project, including the allocation of 
intellectual property rights to technology arising from the 
joint research. This patent protection provides an incentive 
for companies to invest in CRADAs and later invest additional 
corporate funds to commercialize CRADA-generated technology. As 
part of a CRADA, a laboratory may negotiate royalties, with the 
Government retaining a paid-up license to use CRADA-developed 
inventions for Government purposes.
  In 1989, the National Competitiveness Technology Transfer Act 
was enacted as part of the Department of Defense Authorization 
Act for Fiscal Year 1990 (P.L. 101-189). This 1989 law further 
amended Stevenson-Wydler by authorizing Federal agencies to 
allow CRADAs at Government-owned, contractor-operated 
laboratories, such as the contractor-operated laboratories of 
the Department of Energy.
  The 1986 and 1989 amendments to Stevenson-Wydler have been 
successful in achieving their intended purposes. Federal 
laboratories have now entered into over 2,000 CRADAs with 
companies and others. As a result, companies get access to 
technology and expertise they can use to create new products or 
improve manufacturing processes for the benefit of the Nation. 
Moreover, Federal laboratories are provided with valuable 
insights into industry's needs as well as industrial expertise 
that enhances the ability of the laboratories to accomplish 
their Government missions. Agencies ensure that the number of 
CRADAs does not become so large that it interferes with the 
regular Government activities of these laboratories.
  However, one significant problem has arisen with the CRADA 
process that appears to be a barrier to some private companies 
entering into a CRADA. In its effort to provide flexibility to 
both the private sector partners and the Federal laboratories, 
the CRADA process currently provides little guidance on the 
intellectual property rights a collaborating partner should 
routinely receive under a CRADA.
  Giving agencies such broad discretion in the determination of 
intellectual property rights has often resulted in laborious 
negotiations each time a laboratory and company discuss a new 
CRADA. In the case of CRADA inventions developed in whole or in 
part by laboratory employees, current negotiation options range 
all the way from assigning the company full patent rights to 
providing the company with only a nonexclusive license for a 
single narrow application area (``field of use''). In addition, 
current law is vague about who owns inventions developed under 
a CRADA but made solely by the collaborating party's employees. 
Overall, current law gives both sides little guidance on these 
intellectual property matters in developing an appropriate 
CRADA.
  This situation has led to concerns about the current CRADA 
process. Time is money in the private sector. For Federal 
research or inventions to be useful to U.S. companies, CRADA 
agreements must be simple to craft and easy to implement. The 
intense time pressures companies now face require a just-in-
time sensibility in all of a firm's research partners, whether 
private or public. Unfortunately, under current law, CRADA 
negotiations can become protracted when a laboratory and its 
parent agency must decide intellectual property rights on a 
case-by-case basis. Furthermore, a company may be reluctant to 
enter into a CRADA and commit the long-term resources necessary 
to fund the CRADA and then support R&D by the company to refine 
the technology, if that company lacks clear assurances from the 
beginning that it will get clear rights to inventions it helps 
develop.
  These uncertainties concerning intellectual property rights, 
as well as the time and effort required for negotiations, 
appear to hinder collaboration between the private sector and 
Federal laboratories. Consequently, these circumstances have, 
in effect, become barriers to technology transfer and 
cooperation.
  In his October 26, 1993, testimony on this subject before the 
Subcommittee on Science, Technology, and Space, Dr. Alexander 
MacLachlan of DuPont expressed these concerns:

          [We] have been looking for collaborative efforts to 
        better leverage our resources. Substantive partnerships 
        with Government laboratories through CRADAs could be a 
        major source of such leverage. But the establishment of 
        CRADAs is, from our point of view, often difficult. In 
        many cases it has taken well over a year to negotiate a 
        successful CRADA. * * * There is no doubt that 
        complications over intellectual property rights are 
        often the main sticking point during CRADA 
        negotiations. * * * [Also,] we simply cannot make the 
        required investment without some assurance that we will 
        have freer commercialization rights in any resulting 
        technology developments.

  Clearly, the CRADA process would be improved if the law 
provided both agencies and companies with clearer guidelines on 
how to allocate intellectual property rights.
  In addition to the matter of the intellectual property rights 
allocation, two other concerns regarding the current CRADA 
process have arisen. One deals with the royalties that are 
shared with Federal inventors. The authors of the Federal 
Technology Transfer Act of 1986 recognized that it takes 
considerable work by a laboratory inventor to upgrade an idea 
to the point where it is useful to a company, to go through the 
patenting and licensing process, and to answer the licensee's 
questions as the commercialization process moves forward. In 
1986, 20,000 Government patents were not being used or 
developed, partly because laboratory employees were not 
rewarded for making their inventions more commercially useful. 
To address this problem, the 1986 Act provides an economic 
incentive to these laboratory employees. Under the 1986 law, 
agencies must share at least 15 percent of royalties received 
each year from an invention with the Federal inventor or 
inventors. This is a reward, a type of bonus, for contributing 
to technology transfer, as well as an incentive to laboratory 
employees to report new inventions and participate in CRADA 
projects. However, few Federal inventions generate large annual 
royalties, and, as a result, few inventors receive much of a 
bonus. Changing the law to give these inventors the first 
thousand or two thousand dollars earned each year by an 
invention, and then at least 15 percent of the remainder, would 
provide a better reward and incentive.
  A second concern deals with the need to maintain existing 
laboratory support for the Federal Laboratory Consortium for 
Technology Transfer (FLC), an interagency group which trains 
technology transfer officials and helps companies identify 
which laboratories might best help them.
  Fastener Quality Act (P.L. 101-592).--The Fastener Quality 
Act requires that fasteners used in critical industrial 
applications (e.g., airplanes, bridges, etc.) be tested in 
accredited labs to insure they meet specifications. To 
facilitate the traceability of substandard fasteners, the Act 
also prohibits manufacturers and distributors from commingling 
fasteners from more than two different lots in the same 
container. In 1992, after five two-day hearings, the Fastener 
Advisory Committee created under the Act determined that the 
legislation was unworkable because it would impose prohibitive 
costs and administrative costs on the industry. The Fastener 
Advisory Committee recommended changes in the Act that would 
(a) allow a manufacturer to establish the chemistry of a 
finished lot of fasteners through a certification provided by 
the provider of the raw material, (b) allow the sale of 
fasteners having minor non-conformances which do not affect 
performance if the purchaser agrees to accept them, and (c) 
permit commingling of fasteners from different lots under some 
circumstances.
  In August 1992, NIST published proposed regulations for 
notice and comment to implement the Act. However, NIST has yet 
to promulgate final rules because of the pending deliberations 
in Congress. During the 103rd Congress, the Subcommittee on 
Science, Technology, and Space held a hearing on the proposed 
changes in the Fastener Quality Act. The Senate subsequently 
approved those changes as part of a larger bill, S.4/H.R. 820 
(the National Competitiveness Act); however, the 103rd Congress 
adjourned without the Senate-House conference on S.4/H.R. 820 
resolving the differences between the House and Senate versions 
of the bill.

                          Legislative History

  No Committee hearings on S. 1164 have been held during the 
104th Congress. However, during the 103rd Congress, on October 
26, 1993, the Subcommittee on Science, Technology, and Space of 
the Committee held a hearing on S. 1537, the Technology 
Commercialization Act of 1993, a bill similar to S. 1164. Like 
S. 1164, S. 1537 sought to encourage greater transfer and 
commercialization of Federal laboratory technology by 
guaranteeing the intellectual property rights of industry 
partners to inventions generated under cooperative research and 
development agreements and by increasing financial incentives 
to Federal lab scientists conducting the research. At its 
hearing, the Subcommittee heard testimony from Dr. Mary Good, 
Under Secretary for Technology, Department of Commerce; Dr. 
Alexander MacLachlan, Senior Vice President, the DuPont 
Company; Mr. David Ostfeld, Career Activities Council, 
Institute of Electrical and Electronics Engineers; and Mr. 
James E. Wells, Jr., Associate Director for Energy and Science 
Issues, General Accounting Office. All of these witnesses 
expressed support for S. 1537 as an effective mechanism for 
stimulating more commercialization of the research being 
performed by the Federal laboratories.
  On August 10, 1995, Senator Rockefeller introduced S. 1164, 
the Technology Transfer Improvements Act of 1995, with the 
cosponsorship of Senator Burns. On November 3, the Committee 
met in open executive session, and, without objection, ordered 
the bill favorably reported with one amendment. That amendment, 
offered by Senator Burns, makes changes in the Fastener Quality 
Act that were recommended by the Fastener Advisory Committee in 
order to clarify and correct certain provisions in the current 
law.

                      Summary of Major Provisions

  1. Title to intellectual property under CRADAs.--The bill 
guarantees to the industry partner in a CRADA the option to 
choose an exclusive license for a field of use for any sole or 
joint invention made by laboratory employees under the CRADA. 
Such license is subject to several conditions:
  (a) The Federal Government retains a non-exclusive, non-
transferable, irrevocable, paid-up license to use the 
invention.
  (b) If the laboratory assigns title, or grants an exclusive 
license, to an invention to an industry partner, the Government 
may either require the partner to grant a license (or grant the 
license itself) to a responsible applicant if the industry 
partner fails to meet health or safety needs, meet public use 
requirements, or comply with an agreement stipulating that 
products resulting from the invention be substantially 
manufactured in the United States.
  Under current law, the Federal laboratory decides what 
intellectual property rights to inventions are to be granted to 
the private sector partner in a CRADA.
  2. Intellectual property rights of private sector party.--The 
bill also assures a private sector collaborating party of the 
right to own inventions made by its own employees under a 
CRADA. Current law is vague in this regard. The Government 
would normally retain a license for research or other 
Government purposes, but the exact Government rights could be 
negotiable.
  3. Distribution of income received by Federal labs from 
intellectual property rights.--The bill requires that agencies 
must pay Federal inventors the first $2000 in royalties, and 
thereafter 15 percent of the royalties, received each year by 
the agency for inventions of the employee. Current law simply 
provides that the researcher shall receive 15 percent of the 
royalties. The bill also expressly allows the use of the 
remaining royalties received by the lab to reward other 
researchers involved in the project, pay for administrative 
costs related to the project, and fund related research at the 
laboratory.

                            Estimated Costs

  In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and Section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                 Washington, DC, November 17, 1995.
Hon. Larry Pressler,
Chairman, Committee on Commerce, Science, and Transportation, U.S. 
        Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed S. 1164, the Technology Transfer Improvements Act of 
1995, as ordered reported by the Senate Committee on Commerce, 
Science, and Transportation on November 3, 1995. We estimate 
that the provisions regarding the expenditure of license-
related income would increase direct spending during this 
period but that the impact would not be significant. Other 
provisions would have no significant budgetary impact.
    Because S. 1164 would affect direct spending, the bill 
would be subject to pay-as-you-go procedures. The bill would 
not affect the budgets of state or local governments.
    Bill purpose. S. 1164 would revise statutory guidelines for 
various federal activities promoting technology transfer. The 
bill would clarify government policies for cooperative research 
and development agreements (CRADAs), especially with regard to 
rights to intellectual property and allowable contributions and 
expenditures. Policies for the distribution of royalties 
collected by the government under technology licensing 
agreements also would be modified. The bill would earmark a 
higher portion of the annual income from licenses for payments 
to inventors or coinventors, raise the ceiling on the amounts 
that can be paid to inventors, allow government laboratories to 
reinvest any remaining proceeds in related research 
initiatives, and extend the time allowed for agencies to 
obligate the proceeds by one year.
    The bill also would amend the provisions of the Fasteners 
Quality Act regarding laboratory accreditation, commingling of 
fasteners, and enforcement of the act.
    Federal budgetary impact. If enacted, S. 1164 would affect 
direct spending by extending the time allowed for agencies to 
spend income from licenses of intellectual property. Giving 
agencies an additional year to obligate income and royalties 
would increase direct spending because funds that currently 
lapse would now be spent instead of being returned to the 
Treasury. CBO estimates that the impact of this change in 
direct spending would not be significant because the amounts 
that lapse under existing law are small (less than $100,000 a 
year). Changing the guidelines for CRADAs would have no net 
budgetary impact because any additional collections resulting 
from the new policies would be matched by an increase in 
spending for either payments to inventors or related agency 
programs. Other provisions of the bill would have no 
significant budgetary impact.
    Previous estimate. On November 8, 1995, CBO provided an 
estimate for H.R. 2196, the National Technology Transfer and 
Advancement Act of 1995, as ordered reported by the House 
Committee on Science on October 25, 1995. That bill included 
provisions nearly identical to those in S. 1164, and the 
estimated budgetary effects of those sections are the same as 
estimated for this bill.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Kathleen 
Gramp and Rachel Forward.
            Sincerely,
                                          Paul Van de Water
                                   (For June E. O'Neill, Director).

                      Regulatory Impact Statement

  In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported.
  S. 1164, as reported, amends the Stevenson-Wydler Technology 
Innovation Act of 1980, as amended, to encourage more transfer 
and commercialization of Federal lab technology by clarifying 
the intellectual property rights of private companies 
participating in joint research with Federal labs and by 
increasing the financial incentives and rewards for Federal lab 
scientists who contribute to the joint research. The bill also 
makes changes in the Fastener Quality Act to clarify and 
correct certain provisions in the current law. The Committee 
believes that the bill will not subject any individuals or 
businesses affected by the bill to additional regulation, will 
not increase the paperwork requirements for such individuals 
and businesses, and will not have an adverse impact on 
individual privacy.

                      Section-by-Section Analysis

Section 1--Short title

  This section states the Act may be cited as the ``Technology 
Transfer Improvements Act of 1995''.

Section 2--Findings

  This section states that Congress finds that: bringing 
technology and industrial innovation to the marketplace is 
central to the well-being of the United States; the Federal 
Government can help U.S. business to speed the development of 
new products and processes by entering into cooperative 
research and development agreements (CRADAs) which make 
available the assistance of Federal laboratories to the private 
sector; and commercialization and innovation will be enhanced 
if companies, in return for reasonable compensation to the 
Federal Government, can more easily obtain exclusive licenses 
to inventions which develop as a result of cooperative research 
with scientists employed by Federal laboratories.

Section 3--Use of Federal technology

  This section amends Section 11 of the Stevenson-Wydler 
Technology Innovation Act of 1980, as amended (Stevenson-
Wydler), which authorizes funding for the Federal Laboratory 
Consortium for Technology Transfer. The Consortium assists 
companies and others in locating Federal laboratories that 
might assist them. Section 11 requires that a fixed percentage 
(0.008 percent) of the budget of each Federal agency that is to 
be used for that agency's labs be transferred to the National 
Institute of Standards and Technology to carry out Consortium 
activities.
  Section 3 of the reported bill amends the language of Section 
11 of Stevenson-Wydler to ensure that its requirements are only 
imposed on Federal agencies with substantial Federal lab 
budgets. In addition, Section 3 deletes language which would 
have ended the transfer authority in Section 11 after fiscal 
year 1996.

Section 4--Title to intellectual property arising from cooperative 
        research and development agreements

  This section amends section 12(b) of Stevenson-Wydler, which 
deals with laboratory authority regarding patent rights 
associated with inventions developed under CRADAs. Under the 
amended section 12(b), the laboratory participating in a CRADA 
must ensure that the collaborating party has the option to 
choose an exclusive license for a field of use for any 
invention made solely or jointly by a laboratory employee under 
the agreement. This gives the collaborating party greater 
assurance than it has under current law that it will get 
intellectual property rights under a CRADA to which it is 
contributing resources. Under current law, the lab decides what 
rights will be granted to the industry partner.
  This section also amends section 12(b) of Stevenson-Wydler to 
provide that, in consideration for the Government's 
contribution under the agreement, grants of intellectual 
property shall be subject to two conditions: (1) a standard 
nonexclusive, nontransferable, irrevocable, paid-up license 
from the collaborating party to the laboratory to use the 
invention on behalf of the Government and (2) a Government 
right to require the collaborating party to grant to a 
responsible applicant a license in the applicant's licensed 
field of use, but only if the action is necessary to meet 
health and safety needs or to meet requirements for public use 
under Federal regulations, or if the collaborating party has 
failed to comply with an agreement stipulating that products 
resulting from the invention will be manufactured substantially 
in the United States.
  Under the amended subsection, the laboratory also shall 
ensure that a collaborating party may retain title to any 
invention made solely by its employee under a CRADA, in 
exchange for granting the Government a license to use the 
invention for Government purposes.
  The Committee notes that this section gives each private 
sector party entering into a CRADA with a Federal laboratory 
the right to require that the CRADA provide for exclusive 
intellectual property rights for a pre-negotiated field of use 
for any invention occurring under the CRADA, regardless of 
whether the invention is made by a laboratory employee, a 
company employee, or a combination thereof. This provision will 
guarantee the company, at a minimum, an exclusive license for 
that pre-negotiated field of use. However, agencies may still 
grant the company more than an exclusive license and, if they 
wish, assign full patent rights to the company.
  If more than one company is involved in negotiations 
regarding a particular CRADA, the Committee expects each of 
their research interests to be taken into consideration in 
defining the relevant field of use, and that in no event shall 
the total rights given to the private sector participants under 
a CRADA be less than they would be if just one company were 
participating in the CRADA.
  It is also the Committee's intent in this section, as in the 
provisions of Stevenson-Wydler it amends, for an agency to be 
able to determine which of its management levels should be 
considered a laboratory for the purposes of Stevenson-Wydler. 
It is not the intent of the Committee to count as laboratories 
under this Act individual research laboratories which are part 
of a larger management structure which is also a laboratory. 
However, the Committee approves of decisions by agencies, such 
as the Department of Defense and the National Institutes of 
Health, to treat certain research institutes, centers, and 
divisions as separate laboratories even if they are co-located 
with other institutes, centers, or divisions.

Section 5--Distribution of income from intellectual property received 
        by Federal laboratories

  This section amends section 14 of Stevenson-Wydler, the 
provision that deals with the distribution of royalties that 
Federal laboratories receive under CRADAs. The main change is 
to direct laboratories to pay each year the first $2,000, and 
thereafter at least 15 percent, of the royalties or other 
similar payments to the Federal inventor or coinventors of the 
CRADA invention. Current law directs that at least 15 percent 
go to the Federal inventor or coinventors or to promulgate an 
alternative system through regulation. It also raises the 
maximum amount of royalties a Federal inventor may receive in 
any one year from $100,000 to $150,000.
  This section clarifies how laboratories may use remaining 
royalties after payments are made to Federal inventors. It 
provides that remaining royalties may be used to reward other 
employees who contributed substantially to CRADA inventions and 
for laboratory purposes unrelated to CRADAs, including 
rewarding laboratory employees for other contributions, 
furthering scientific exchange, supporting education and 
training, paying expenses incidental to the administration and 
licensing of intellectual property, and supporting research 
consistent with the objectives of the laboratory.

Section 6--Employee activities

  This section makes technical amendments to section 15(a) of 
Stevenson-Wydler to clarify its intent. Section 15(a) states 
that a Federal agency shall give title to an invention to an 
employee or former employee who made that invention if the 
agency does not intend to file a patent application or 
otherwise promote commercialization of such invention. It also 
provides that the Government retains a license to use the 
invention for its own purposes.
  The Committee believes that this language will correct any 
confusion that has arisen in agencies regarding whether the 
Government, when it takes ownership of an employee's invention, 
may subsequently waive ownership of any such invention it does 
not intend to pursue.

Section 7--Amendment to Bayh-Dole Act

  This section makes a technical change to a provision in the 
Bayh-Dole Act, which legislation deals with the allocation of 
patent rights to inventions arising from Federally funded 
research. Current law makes clear that, in cases of conflict, 
Stevenson-Wydler takes precedence over Bayh-Dole. However, as 
currently worded, the Bayh-Dole Act refers to Stevenson-Wydler 
``as amended by the Federal Technology Innovation Act of 
1986,'' which could be read to mean that the provision would 
not apply to any post-1986 amendments to Stevenson-Wydler. 
Section 7 of S. 1164 would strike the above-quoted phrase so 
that the law would simply read that Stevenson-Wydler takes 
precedence, which would be interpreted by the courts as 
covering all subsequent amendments to Stevenson-Wydler.

Section 8--Fastener Quality Act Amendments

  This section amends the Fastener Quality Act (P.L. 101-592) 
to allow minor nonconformance in fastener specifications if 
such nonconformance is consistent with consensus standards 
organizations' policies; exclude distributors from the persons 
covered by the commingling prohibition; and allow the fastener 
manufacturers to use a certification from the metal supplier to 
establish the chemistry of the finished fasteners. The Fastener 
Advisory Committee, created pursuant to the Fastener Quality 
Act, recommended that legislative changes in these three areas 
be made after estimating that, without such changes, 
implementation of the Act would impose almost $1 billion in 
additional costs on the fastener industry. The text of Section 
8 of the reported bill was developed by the Fastener Advisory 
Committee created under the law, a committee representing all 
segments of the fastener industry.
  The bill repeals Section 4 of the Act, which allows the 
Secretary of Commerce to waive the requirements of Act with 
regard to categories of fasteners not used in critical 
applications and to include within the Act's coverage 
categories of fasteners not specifically described in the Act. 
The bill also authorizes the Department of Commerce to conduct 
investigations into matters arising under the Fastener Quality 
Act and reduces from 10 years to 5 years the time for retention 
of records required under the Fastener Quality Act. Further, 
the bill strikes the phrase ``within 180 days after the date of 
enactment of this Act'' in Section 13 of the Fastener Quality 
Act. Section 13 requires the Secretary of Commerce to issue 
rules implementing the Act within 180 days of enactment of the 
Act. Since that deadline expired four years ago without 
regulations having been issued, the 180-day deadline in the 
current law no longer has meaning. Finally, the bill repeals 
Section 14 of the Act, which requires the Secretary of Commerce 
to appoint a fasteners advisory committee. The advisory 
committee referenced in Section 14 was, in fact, appointed 
after enactment of the Fastener Quality Act. It completed its 
main work in 1994 but continues under current law.

                        Changes in Existing Law

  In compliance with paragraph 12 of rule XXVI of the Standing 
Rules of the Senate, changes in existing law made by the Bill, 
as reported, are shown as follows (existing law proposed to be 
omitted is enclosed in black brackets, new material is printed 
in italic, existing law in which no change is proposed is shown 
in roman):

                      TITLE 15, UNITED STATES CODE

                   CHAPTER 63--TECHNOLOGY INNOVATION

Sec. 3710. Utilization of Federal technology

  (a) Policy.--
          (1) It is the continuing responsibility of the 
        Federal Government to ensure the full use of the 
        results of the Nation's Federal investment in research 
        and development. To this end the Federal Government 
        shall strive where appropriate to transfer federally 
        owned or originated technology to State and local 
        governments and to the private sector.
          (2) Technology transfer, consistent with mission 
        responsibilities, is a responsibility of each 
        laboratory science and engineering professional.
          (3) Each laboratory director shall ensure that 
        efforts to transfer technology are considered 
        positively in laboratory job descriptions, employee 
        promotion policies, and evaluation of the job 
        performance of scientists and engineers in the 
        laboratory.
  (b) Establishment of Research and Technology Applications 
Offices.--Each Federal laboratory shall establish an Office of 
Research and Technology Applications. Laboratories having 
existing organizational structures which perform the functions 
of this section may elect to combine the Office of Research and 
Technology Applications within the existing organization. The 
staffing and funding levels for these offices shall be 
determined between each Federal laboratory and the Federal 
agency operating or directing the laboratory, except that (1) 
each laboratory having 200 or more full-time equivalent 
scientific, engineering, and related technical positions shall 
provide one or more full-time equivalent positions as staff for 
its Office of Research and Technology Applications, and (2) 
each Federal agency which operates or directs one or more 
Federal laboratories shall make available sufficient funding, 
either as a separate line item or from the agency's research 
and development budget, to support the technology transfer 
function at the agency and at its laboratories, including 
support of the Offices of Research and Technology 
Applications.Furthermore, individuals filling positions in an 
Office of Research and Technology Applications shall be 
included in the overall laboratory/agency management 
development program so as to ensure that highly competent 
technical managers are full participants in the technology 
transfer process. The agency head shall submit to Congress at 
the time the President submits the budget to Congress an 
explanation of the agency's technology transfer program for the 
preceding year and the agency's plans for conducting its 
technology transfer function for the upcoming year, including 
plans for securing intellectual property rights in laboratory 
innovations with commercial promise and plans for managing such 
innovations so as to benefit the competitiveness of United 
States industry.
  (c) Functions of Research and Technology Applications 
Offices.--It shall be the function of each Office of Research 
and Technology Applications--
          (1) to prepare application assessments for selected 
        research and development projects in which that 
        laboratory is engaged and which in the opinion of the 
        laboratory may have potential commercial applications;
          (2) to provide and disseminate information on 
        federally owned or originated products, processes, and 
        services having potential application to State and 
        local governments and to private industry;
          (3) to cooperate with and assist the National 
        Technical Information Service, the Federal Laboratory 
        Consortium for Technology Transfer, and other 
        organizations which link the research and development 
        resources of that laboratory and the Federal Government 
        as a whole to potential users in State and local 
        government and private industry;
          (4) to provide technical assistance to State and 
        local government officials; and
          (5) to participate, where feasible, in regional, 
        State, and local programs designed to facilitate or 
        stimulate the transfer of technology for the benefit of 
        the region, State, or local jurisdiction in which the 
        Federal laboratory is located.
Agencies which have established organizational structures 
outside their Federal laboratories which have as their 
principal purpose the transfer of federally owned or originated 
technology to State and local government and to the private 
sector may elect to perform the functions of this subsection in 
such organizational structures. No Office of Research and 
Technology Applications or other organizational structures 
performing the functions of this subsection shall substantially 
compete with similar services available in the private sector.
  (d) Center for the Utilization of Federal Technology.--The 
National Technical Information Service shall--
          (1) serve as a central clearinghouse for the 
        collection, dissemination and transfer of information 
        on federally owned or originated technologies having 
        potential application to State and local governments 
        and to private industry;
          (2) utilize the expertise and services of the 
        National Science Foundation and the Federal Laboratory 
        Consortium for Technology Transfer; particularly in 
        dealing with State and local governments;
          (3) receive requests for technical assistance from 
        State and local governments, respond to such requests 
        with published information available to the Service, 
        and refer such requests to the Federal Laboratory 
        Consortium for Technology Transfer to the extent that 
        such requests require a response involving more than 
        the published information available to the Service;
          (4) provide funding, at the discretion of the 
        Secretary, for Federal laboratories to provide the 
        assistance specified in subsection (c)(3);
          (5) use appropriate technology transfer mechanisms 
        such as personnel exchanges and computer-based systems; 
        and
          (6) maintain a permanent archival repository and 
        clearinghouse for the collection and dissemination of 
        nonclassified scientific, technical, and engineering 
        information.
  (e) Establishment of Federal Laboratory Consortium for 
Technology Transfer.--
          (1) There is hereby established the Federal 
        Laboratory Consortium for Technology Transfer 
        (hereinafter referred to as the ``Consortium'') which, 
        in cooperation with Federal Laboratories and the 
        private sector, shall--
                  (A) develop and (with the consent of the 
                Federal laboratory concerned)administer 
                techniques, training courses, and materials 
                concerning technology transfer to increase the 
                awareness of Federal laboratory employees 
                regarding the commercial potential of 
                laboratory technology and innovations;
                  (B) furnish advice and assistance requested 
                by Federal agencies and laboratories for use in 
                their technology transfer programs (including 
                the planning of seminars for small business and 
                other industry);
                  (C) provide a clearinghouse for requests, 
                received at the laboratory level, for technical 
                assistance from States and units of local 
                governments, businesses, industrial development 
                organizations, not-for-profit organizations 
                including universities, Federal agencies and 
                laboratories, and other persons, and--
                          (i) to the extent that such requests 
                        can be responded to with published 
                        information available to the National 
                        Technical Information Service, refer 
                        such requests to that Service, and
                          (ii) otherwise refer these requests 
                        to the appropriate Federal laboratories 
                        and agencies;
                  (D) facilitate communication and coordination 
                between Offices of Research and Technology 
                Applications of Federal laboratories;
                  (E) utilize (with the consent of the agency 
                involved) the expertise and services of the 
                National Science Foundation, the Department of 
                Commerce, the National Aeronautics and Space 
                Administration, and other Federal agencies, as 
                necessary;
                  (F) with the consent of any Federal 
                laboratory, facilitate the use by such 
                laboratory of appropriate technology transfer 
                mechanisms such as personnel exchanges and 
                computer-based systems;
                  (G) with the consent of any Federal 
                laboratory, assist such laboratory to establish 
                programs using technical volunteers to provide 
                technical assistance to communities related to 
                such laboratory;
                  (H) facilitate communication and cooperation 
                between Offices of Research and Technology 
                Applications of Federal laboratories and 
                regional, State, and local technology transfer 
                organizations;
                  (I) when requested, assist colleges or 
                universities, businesses, nonprofit 
                organizations, State or local governments, or 
                regional organizations to establish programs to 
                stimulate research and to encourage technology 
                transfer in such areas as technology program 
                development, curriculum design, long-term 
                research planning, personnel needs projections, 
                and productivity assessments; and
                  (J) seek advice in each Federal laboratory 
                consortium region from representatives of State 
                and local governments, large and small 
                business, universities, and other appropriate 
                persons on the effectiveness of the program 
                (and any such advice shall be provided at no 
                expense to the Government).
          (2) The membership of the Consortium shall consist of 
        the Federal laboratories described in clause (1) of 
        subsection (b) and such other laboratories as may 
        choose to join the Consortium. The representatives to 
        the Consortium shall include a senior staff member of 
        each Federal laboratory which is a member of the 
        Consortium and a senior representative appointed from 
        each Federal agency with one or more member 
        laboratories.
          (3) The representatives to the Consortium shall elect 
        a Chairman of the Consortium.
          (4) The Director of the National Institute of 
        Standards and Technology shall provide the Consortium, 
        on a reimbursable basis, with administrative services, 
        such as office space, personnel, and support services 
        of the Institute, as requested by the Consortium and 
        approved by such Director.
          (5) Each Federal laboratory or agency shall transfer 
        technology directly to users or representatives of 
        users, and shall not transfer technology directly to 
        the Consortium. Each Federal laboratory shall conduct 
        and transfer technology only in accordance with the 
        practices and policies of the Federal agency which 
        owns, leases, or otherwise uses such Federal 
        laboratory.
          (6) Not later than one year after the date of the 
        enactment of this subsection, and every year 
        thereafter, the Chairman of the Consortium shall submit 
        a report to the President, to the appropriate 
        authorization and appropriation committees of both 
        Houses of the Congress, and to each agency with respect 
        to which a transfer of funding is made (for the fiscal 
        year or years involved) under paragraph (7), concerning 
        the activities of the Consortium and the expenditures 
        made by it under this subsection during the year for 
        which the report is made. Such report shall include an 
        annual independent audit of the financial statements of 
        the Consortium, conducted in accordance with generally 
        accepted accounting principles.
          (7)(A) Subject to subparagraph (B), an amount equal 
        to 0.008 percent of the budget of each Federal agency 
        from any Federal source, including related overhead, 
        that is to be utilized by or on behalf of the 
        laboratories of such agency for a fiscal year referred 
        to in subparagraph (B)(ii) shall be transferred by such 
        agency to the National Institute of Standards and 
        Technology at the beginning of the fiscal year 
        involved. Amounts so transferred shall be provided by 
        the Institute to the Consortium for the purpose of 
        carrying out activities of the Consortium under this 
        subsection.
          [(B) A transfer shall be made by any Federal agency 
        under subparagraph (A), for any fiscal year, only if--
                  [(i) the amount so transferred by that agency 
                (as determined under such subparagraph) would 
                exceed $ 10,000; and
                  [(ii) such transfer is made with respect to 
                the fiscal year 1987, 1988, 1989, 1990, 1991, 
                1992, 1993, 1994, 1995, or 1996.]
          (B) A transfer shall be made by any Federal agency 
        under subparagraph (A), for any fiscal year, only if 
        the amount so transferred by that agency (as determined 
        under such subparagraph) would exceed $10,000.
          (C) The heads of Federal agencies and their 
        designees, and the directors of Federal laboratories, 
        may provide such additional support for operations of 
        the Consortium as they deem appropriate.
          (8) [Repealed]
  (f) Agency Reporting.--Each Federal agency which operates or 
directs one or more Federal laboratories shall report annually 
to the Congress, as part of the agency's annual budget 
submission, on the activities performed by that agency and its 
Federal laboratories pursuant to the provisions of this 
section. The report shall be transmitted to the Center for the 
Utilization of Federal Technology by November 1 of each year in 
which it is due.
  (g) Functions of the Secretary.--
          (1) The Secretary, through the Under Secretary, and 
        in consultation with other Federal agencies, may--
                  (A) make available to interested agencies the 
                expertise of the Department of Commerce 
                regarding the commercial potential of 
                inventions and methods and options for 
                commercialization which are available to the 
                Federal laboratories, including research and 
                development limited partnerships;
                  (B) develop and disseminate to appropriate 
                agency and laboratory personnel model 
                provisions for use on a voluntary basis in 
                cooperative research and development 
                arrangements; and
                  (C) furnish advice and assistance, upon 
                request, to Federal agencies concerning their 
                cooperative research and development programs 
                and projects.
          (2) Two years after the date of the enactment of this 
        subsection and every two years thereafter, the 
        Secretary shall submit a summary report to the 
        President and the Congress on the use by the agencies 
        and the Secretary of the authorities specified in this 
        Act [15 U.S.C. 3701 et seq.]. Other Federal agencies 
        shall cooperate in the report's preparation.
          (3) Not later than one year after the date of the 
        enactment of the Federal Technology Transfer Act of 
        1986, the Secretary shall submit to the President and 
        the Congress a report regarding--
                  (A) any copyright provisions or other types 
                of barriers which tend to restrict or limit the 
                transfer of federally funded computer software 
                to the private sector and to State and local 
                governments, and agencies of such State and 
                local governments; and
                  (B) the feasibility and cost of compiling and 
                maintaining a current and comprehensive 
                inventory of all federally funded training 
                software.
  (h) [Repealed]
  (i) Research Equipment.--The Director of a laboratory, or the 
head of any Federal agency or department, may give research 
equipment that is excess to the needs of the laboratory, 
agency, or department to an educational institution or 
nonprofit organization for the conduct of technical and 
scientific education and research activities. Title of 
ownership shall transfer with a gift under the section.

Sec.  3710a. Cooperative research and development agreements

  (a) General Authority.--Each Federal agency may permit the 
director of any of its Government-operated Federal 
laboratories, and, to the extent provided in an agency-approved 
joint work statement, the director of any of its Government-
owned, contractor-operated laboratories--
          (1) to enter into cooperative research and 
        development agreements on behalf of such agency 
        (subject to subsection (c) of this section) with other 
        Federal agencies; units of State or local government; 
        industrial organizations (including corporations, 
        partnerships, and limited partnerships, and industrial 
        development organizations); public and private 
        foundations; nonprofit organizations (including 
        universities); or other persons (including licensees of 
        inventions owned by the Federal agency); and
          (2) to negotiate licensing agreements under section 
        207 of title 35, United States Code, or under other 
        authorities (in the case of a Government-owned, 
        contractor-operated laboratory, subject to subsection 
        (c) of this section) for inventions made or other 
        intellectual property developed at the laboratory and 
        other inventions or other intellectual property that 
        may be voluntarily assigned to the Government.
  [(b) Enumerated Authority.--Under agreements entered into 
pursuant to subsection (a)(1), a Government-operated Federal 
laboratory, and, to the extent provided in an agency-approved 
joint work statement, a Government-owned, contractor-operated 
laboratory, may (subject to subsection (c) of this section)--
          [(1) accept, retain, and use funds, personnel, 
        services, and property from collaborating parties and 
        provide personnel, services, and property to 
        collaborating parties;
          [(2) grant or agree to grant in advance, to a 
        collaborating party, patent licenses or assignments, or 
        options thereto, in any invention made in whole or in 
        part by a laboratory employee under the agreement, 
        retaining a nonexclusive, nontransferable, irrevocable, 
        paid-up license to practice the invention or have the 
        invention practiced throughout the world by or on 
        behalf of the Government and such other rights as the 
        Federal laboratory deems appropriate;
          [(3) waive, subject to reservation by the Government 
        of a nonexclusive, irrevocable, paid-up license to 
        practice the invention or have the invention practiced 
        throughout the world by or on behalf of the Government, 
        in advance, in whole or in part, any right of ownership 
        which the Federal Government may have to any subject 
        invention made under the agreement by a collaborating 
        party or employee of a collaborating party;
          [(4) determine rights in other intellectual property 
        developed under an agreement entered into under 
        subsection (a)(1); and
          [(5) to the extent consistent with any applicable 
        agency requirements and standards of conduct, permit 
        employees or former employees of the laboratory to 
        participate in efforts to commercialize inventions they 
        made while in the service of the United States.
[A Government-owned, contractor-operated laboratory that enters 
into a cooperative research and development agreement under 
subsection (a)(1) may use or obligate royalties or other income 
accruing to such laboratory under such agreement with respect 
to any invention only (i) for payments to investors; (ii)for 
the purposes described in section 14(a)(1)(B) (i), (ii), and 
(iv) [15 U.S.C. 3710c(a)(1)(B) (i), (ii), and (iv)]; and (iii) 
for scientific research and development consistent with the 
research and development mission and objectives of the 
laboratory.]
    (b) Enumerated Authority.--(1) Under an agreement entered 
into pursuant to subsection (a)(1), the laboratory may grant, 
or agree to grant in advance, to a collaborating party patent 
licenses or assignments, or options thereto, in any invention 
made in whole or in part by a laboratory employee under the 
agreement, for reasonable compensation when appropriate. The 
laboratory shall ensure that the collaborating party has the 
option to choose an exclusive license for a field of use for 
any such invention under the agreement or, if there is more 
than one collaborating party, that the collaborating parties 
are offered the option to hold licensing rights that 
collectively encompass the rights that would be held under such 
an exclusive license by one party. In consideration for the 
Government's contribution under the agreement, grants under 
this paragraph shall be subject to the following explicit 
conditions:
          (A) A nonexclusive, nontransferable, irrevocable, 
        paid-up license from the collaborating party to the 
        laboratory to practice the invention or have the 
        invention practiced throughout the world by or on 
        behalf of the Government. In the exercise of such 
        license, the Government shall not publicly disclose 
        trade secrets or commercial or financial information 
        that is privileged or confidential within the meaning 
        of section 552(b)(4) of title 5, United States Code, or 
        which would be considered as such if it had been 
        obtained from a non-Federal party.
          (B) If a laboratory assigns title or grants an 
        exclusive license to such an invention, the Government 
        shall retain the right--
                  (i) to require the collaborating party to 
                grant to a responsible applicant a 
                nonexclusive, partially exclusive, or exclusive 
                license to use the invention in the applicant's 
                licensed field of use, on terms that are 
                reasonable under the circumstances; or
                  (ii) if the collaborating party fails to 
                grant such a license, to grant the license 
                itself.
          (C) The Government may exercise its right retained 
        under subparagraphs (B)(ii) and (iii) only if the 
        Government finds that--
                  (i) the action is necessary to meet health or 
                safety needs that are not reasonably satisfied 
                by the collaborating party;
                  (ii) the action is necessary to meet 
                requirements for public use specified by 
                Federal regulations, and such requirements are 
                not reasonably satisfied by the collaborating 
                party; or
                  (iii) the collaborating party has failed to 
                comply with an agreement containing provisions 
                described in subsection (c)(4)(B).
  (2) Under agreements entered into pursuant to subsection 
(a)(1), the laboratory shall ensure that a collaborating party 
may retain title to any invention made solely by its employee 
in exchange for normally granting the Government a 
nonexclusive, nontransferable, irrevocable, paid-up license to 
practice the invention or have the invention practiced 
throughout the world by or on behalf of the Government for 
research or other Government purposes.
  (3) Under an agreement entered into pursuant to subsection 
(a)(1), a laboratory may--
          (A) accept, retain, and use funds, personnel, 
        services, and property from a collaborating party and 
        provide personnel, services, and property to a 
        collaborating party;
          (B) use funds received from a collaborating party in 
        accordance with subparagraph (A) to hire personnel to 
        carry out the agreement who will not be subject to 
        full-time equivalent restrictions of the agency; and
          (C) to the extent consistent with any applicable 
        agency requirements or standards of conduct, permit an 
        employee or former employee of the laboratory to 
        participate in an effort to commercialize an invention 
        made by the employee or former employee while in the 
        employment or service of the Government.
  (4) A collaborating party in an exclusive license in any 
invention made under an agreement entered into pursuant to 
subsection (a)(1) shall have the right of enforcement under 
chapter 29 of title 35, United States Code.
  (5) A Government-owned, contractor-operated laboratory that 
enters into a cooperative research and development agreement 
pursuant to subsection (a)(1) may use or obligate royalties or 
other income accruing to the laboratory under such agreement 
with respect to any invention only--
          (A) for payments to inventors;
          (B) for purposes described in clauses (i), (iii), and 
        (iv) of section 14(a)(1)(B); and
            (C) for scientific research and development 
        consistent with the research and development missions 
        and objectives of the laboratory.
  (c) Contract Considerations.--
          (1) A Federal agency may issue regulations on 
        suitable procedures for implementing the provisions of 
        this section; however, implementation of this section 
        shall not be delayed until issuance of such 
        regulations.
          (2) The agency in permitting a Federal laboratory to 
        enter into agreements under this section shall be 
        guided by the purposes of this Act.
          (3) (A) Any agency using the authority given it under 
        subsection (a) shall review standards of conduct for 
        its employees for resolving potential conflicts of 
        interest to make sure they adequately establish 
        guidelines for situations likely to arise through the 
        use of this authority, including but not limited to 
        cases where present or former employees or their 
        partners negotiate licenses or assignments of titles to 
        inventions or negotiate cooperative research and 
        development agreements with Federal agencies (including 
        the agency with which the employee involved is or was 
        formerly employed).
                  (B) If, in implementing subparagraph (A), an 
                agency is unable to resolve potential conflicts 
                of interest within its current statutory 
                framework, it shall propose necessary statutory 
                changes to be forwarded to its authorizing 
                committees in Congress.
          (4) The laboratory director in deciding what 
        cooperative research and development agreements to 
        enter into shall--
                  (A) give special consideration to small 
                business firms, and consortia involving small 
                business firms; and
                  (B) give preference to business units located 
                in the United States which agree that products 
                embodying inventions made under the cooperative 
                research and development agreement or produced 
                through the use of such inventions will be 
                manufactured substantially in the United States 
                and, in the case of any industrial organization 
                or other person subject to the control of a 
                foreign company or government, as appropriate, 
                take into consideration whether or not such 
                foreign government permits United States 
                agencies, organizations, or other persons to 
                enter into cooperative research and development 
                agreements and licensing agreements.
          (5)(A) If the head of the agency or his designee 
        desires an opportunity to disapprove or require the 
        modification of any such agreement presented by the 
        director of a Government-operated laboratory, the 
        agreement shall provide a 30-day period within which 
        such action must be taken beginning on the date the 
        agreement is presented to him or her by the head of the 
        laboratory concerned.
          (B) In any case in which the head of an agency or his 
        designee disapproves or requires the modification of an 
        agreement presented by the director of a Government-
        operated laboratory under this section, the head of the 
        agency or such designee shall transmit a written 
        explanation of such disapproval or modification to the 
        head of the laboratory concerned.
          (C)(i) Except as provided in subparagraph (D), any 
        agency which has contracted with a non-Federal entity 
        to operate a laboratory shall review and approve, 
        request specific modifications to, or disapprove a 
        joint work statement that is submitted by the director 
        of such laboratory within 90 days after such 
        submission. In any case where an agency has requested 
        specific modifications to a joint work statement, the 
        agency shall approve or disapprove any resubmission of 
        such joint work statement within 30 days after such 
        resubmission, or 90 days after the original submission, 
        whichever occurs later. No agreement may be entered 
        into by a Government-owned, contractor-operated 
        laboratory under this section before both approval of 
        the agreement under clause (iv) and approval under this 
        clause of a joint work statement.
                  (ii) In any case in which an agency which has 
                contracted with a non-Federal entity to operate 
                a laboratory disapproves or requests the 
                modification of a joint work statement 
                submitted under this section, the agency shall 
                promptly transmit a written explanation of such 
                disapproval or modification to the director of 
                the laboratory concerned.
                  (iii) Any agency which has contracted with a 
                non-Federal entity to operate a laboratory or 
                laboratories shall develop and provide to such 
                laboratory or laboratories one or more model 
                cooperative research and development 
                agreements, for the purposes of standardizing 
                practices and procedures, resolving common 
                legal issues, and enabling review of 
                cooperative research and development agreements 
                to be carried out in a routine and prompt 
                manner.
                  (iv) An agency which has contracted with a 
                non-Federal entity to operate a laboratory 
                shall review each agreement under this section. 
                Within 30 days after the presentation, by the 
                director of the laboratory, of such agreement, 
                the agency shall, on the basis of such review, 
                approve or request specific modification to 
                such agreement. Such agreement shall not take 
                effect before approval under this clause.
                  (v) If an agency fails to complete a review 
                under clause (iv) within the 30-day period 
                specified therein, the agency shall submit to 
                the Congress, within10 days after the end of 
                that 30-day period, a report on the reasons for 
                such failure. The agency shall, at the end of 
                each successive 30-day period thereafter during 
                which such failure continues, submit to the 
                Congress another report on the reasons for the 
                continuing failure. Nothing in this clause 
                relieves the agency of the requirement to 
                complete a review under clause (iv).
                  (vi) In any case in which an agency which has 
                contracted with a non-Federal entity to operate 
                a laboratory requests the modification of an 
                agreement presented under this section, the 
                agency shall promptly transmit a written 
                explanation of such modification to the 
                director of the laboratory concerned.
          (D)(i) Any non-Federal entity that operates a 
        laboratory pursuant to a contract with a Federal agency 
        shall submit to the agency any cooperative research and 
        development agreement that the entity proposes to enter 
        into with a small business firm and the joint work 
        statement required with respect to that agreement.
                  (ii) A Federal agency that receives a 
                proposed agreement and joint work statement 
                under clause (i) shall review and approve, 
                request specific modifications to, or 
                disapprove the proposed agreement and joint 
                work statement within 30 days after such 
                submission. No agreement may be entered into by 
                a Government-owned, contractor-operated 
                laboratory under this section before both 
                approval of the agreement and approval of a 
                joint work statement under this clause.
                  (iii) In any case in which an agency which 
                has contracted with an entity referred to in 
                clause (i) disapproves or requests the 
                modification of a cooperative research and 
                development agreement or joint work statement 
                submitted under that clause, the agency shall 
                transmit a written explanation of such 
                disapproval or modification to the head of the 
                laboratory concerned.
          (6) Each agency shall maintain a record of all 
        agreements entered into under this section.
          (7)(A) No trade secrets or commercial or financial 
        information that is privileged or confidential, under 
        the meaning of section 552(b)(4) of title 5, United 
        States Code, which is obtained in the conduct of 
        research or as a result of activities under this Act 
        [15 U.S.C. 3701 et seq.] from a non-Federal party 
        participating in a cooperative research and development 
        agreement shall be disclosed.
          (B) The director, or in the case of a contractor-
        operated laboratory, the agency, for a period of up to 
        5 years after development of information that results 
        from research and development activities conducted 
        under this Act [15 U.S.C. 3701 et seq.] and that would 
        be a trade secret or commercial or financial 
        information that is privileged or confidential if the 
        information had been obtained from a non-Federal party 
        participating in a cooperative research and development 
        agreement, may provide appropriate protections against 
        the dissemination of such information, including 
        exemption from subchapter II of chapter 5 of title 5, 
        United States Code [5 U.S.C. 551 et seq.].
  (d) Definition.--As used in this section--
          (1) the term ``cooperative research and development 
        agreement'' means any agreement between one or more 
        Federal laboratories and one or more non-Federal 
        parties under which the Government, through its 
        laboratories, provides personnel, services, facilities, 
        equipment, intellectual property, or other resources 
        with or without reimbursement (but not funds to non-
        Federal parties) and the non-Federal parties provide 
        funds, personnel, services, facilities, equipment, 
        intellectual property, or other resources toward the 
        conduct of specified research or development efforts 
        which are consistent with the missions of the 
        laboratory; except that such term does not include a 
        procurement contractor cooperative agreement as those 
        terms are used in sections 6303, 6304, and 6305 of 
        title 31, United States Code;
          (2) the term ``laboratory'' means--
                  (A) a facility or group of facilities owned, 
                leased, or otherwise used by a Federal agency, 
                a substantial purpose of which is the 
                performance of research, development, or 
                engineering by employees of the Federal 
                Government;
                  (B) a group of Government-owned, contractor-
                operated facilities (including a weapon 
                production facility of the Department of 
                Energy) under a common contract, when a 
                substantial purpose of the contract is the 
                performance of research and development, or the 
                production, maintenance, testing, or 
                dismantlement of a nuclear weapon or its 
                components, for the Federal Government; and
                  (C) a Government-owned, contractor-operated 
                facility (including a weapon production 
                facility of the Department of Energy) that is 
                not under a common contract described in 
                subparagraph (B), and the primary purpose of 
                which is the performance of research and 
                development, or the production, maintenance, 
                testing, or dismantlement of a nuclear weapon 
                or its components, for the Federal government,
        but such term does not include any facility covered by 
        Executive Order No. 12344 [42 U.S.C. 7158 note], dated 
        February 1, 1982, pertaining to the naval nuclear 
        propulsion program;
          (3) the term ``joint work statement'' means a 
        proposal prepared for a Federal agency by the director 
        of a Government-owned, contractor-operated laboratory 
        describing the purpose and scope of a proposed 
        cooperative research and development agreement, and 
        assigning rights and responsibilities among the agency, 
        the laboratory, and any other party or parties to the 
        proposed agreement; and
          (4) the term ``weapon production facility of the 
        Department of Energy'' means a facility under the 
        control or jurisdiction of the Secretary of Energy that 
        is operated for national security purposes and is 
        engaged in the production, maintenance, testing, or 
        dismantlement of a nuclear weapon or its components.
  (e) Determination of Laboratory Missions.--For purposes of 
this section, an agency shall make separate determinations of 
the mission or missions of each of its laboratories.
  (f) Relationship to Other Laws.--Nothing in this section is 
intended to limit or diminish existing authorities of any 
agency.
  (g) Principles.--In implementing this section, each agency 
which has contracted with a non-Federal entity to operate a 
laboratory shall be guided by the following principles:
          (1) The implementation shall advance program missions 
        at the laboratory, including any national security 
        mission.
          (2) Classified information and unclassified sensitive 
        information protected by law, regulation, or Executive 
        order shall be appropriately safeguarded.

Sec.  3710c. Distribution of royalties received by federal agencies

  (a) In General.--
          [(1) Except as provided in paragraphs (2) and (4), 
        any royalties or other income received by a Federal 
        agency from the licensing or assignment of inventions 
        under agreements entered into by Government-operated 
        Federal laboratories under section 12 [15 U.S.C. 
        3710b], and inventions of government-operated Federal 
        laboratories licensed under section 207 of title 35, 
        United States Code, or under any other provision of 
        law, shall be retained by the agency whose laboratory 
        produced the invention and shall be disposed of as 
        follows:
                  [(A)(i) The head of the agency or his 
                designee shall pay at least 15 percent of the 
                royalties or other income the agency receives 
                on account of any invention to the inventor (or 
                co-inventors) if the inventor (or each such co-
                inventor) has assigned his or her rights in the 
                invention to the United States. This clause 
                shall take effect on the date of the enactment 
                of this section unless the agency publishes a 
                notice in the Federal Register within 90 days 
                of such date indicating its election to file a 
                Notice of Proposed Rulemaking pursuant to 
                clause (ii).
                  [(ii) An agency may promulgate, in accordance 
                with section 553 of title 5, United States 
                Code, regulations providing for an alternative 
                program for sharing royalties with inventors 
                licensed inventions under clause (i). Such 
                regulations must--
                          [(I) guarantee a fixed minimum 
                        payment to each such inventor, each 
                        year that the agency receives royalties 
                        from that inventor's invention;
                          [(II) provide a percentage royalty 
                        share to each such inventor, each year 
                        that the agency receives royalties from 
                        that inventor's invention in excess of 
                        a threshold amount;
                          [(III) provide that total payments to 
                        all such inventors shall exceed 15 
                        percent of total agency royalties in 
                        any given fiscal year; and
                          [(IV) provide appropriate incentives 
                        from royalties for those laboratory 
                        employees who contribute substantially 
                        to the technical development of a 
                        licensed invention between the time of 
                        the filing of the patent application 
                        and the licensing of the invention.
                  [(iii) An agency that has published its 
                intention to promulgate regulations under 
                clause (ii) may elect not to pay inventors 
                under clause (i) until the expiration of two 
                years after the date of the enactment of this 
                Act or until the date of the promulgation of 
                such regulations, whichever is earlier. If an 
                agency makes such an election and after two 
                years the regulations have not been 
                promulgated, the agency shall make payments (in 
                accordance with clause (i)) of at least 15 
                percent of the royalties involved, retroactive 
                to the date of the enactment of this Act. If 
                promulgation of the regulations occurs within 
                two years after the date of the enactment of 
                this Act, payments shall be made in accordance 
                with such regulations, retroactive to the date 
                of the enactment of this Act. The agency shall 
                retain its royalties until the inventor's 
                portion is paid under either clause (i) or 
                (ii). Such royalties shall not be transferred 
                to the agency's Government-operated 
                laboratories under subparagraph (B) and shall 
                not revert to the Treasury pursuant to 
                paragraph (2) as a result of any delay caused 
                by rulemaking under this subparagraph.
                  [(B) The balance of the royalties or other 
                income shall be transferred by the agency to 
                its Government-operated laboratories, with the 
                majority share of the royalties or other income 
                from any invention going to the laboratory 
                where the invention occurred; and the funds so 
                transferred to any such laboratory may be used 
                or obligated by that laboratory during the 
                fiscal year in which they are received or 
                during the succeeding fiscal year--
                          [(i) for payment of expenses 
                        incidental to the administration and 
                        licensing of inventions by that 
                        laboratory or by the agency with 
                        respect to inventions which occurred at 
                        that laboratory, including the fees or 
                        other costs for the services of other 
                        agencies, persons, or organizations for 
                        invention management and licensing 
                        services;
                          [(ii) to reward scientific, 
                        engineering, and technical employees of 
                        that laboratory, including payments to 
                        inventors and developers of sensitive 
                        or classified technology, regardless of 
                        whether the technology has commercial 
                        applications;
                          [(iii) to further scientific exchange 
                        among the Government-operated 
                        laboratories of the agency; or
                          [(iv) for education and training of 
                        employees consistent with the research 
                        and development mission and objectives 
                        of the agency, and for other activities 
                        that increase the licensing potential 
                        for transfer of the technology of the 
                        laboratories of the agency.
                [Any of such funds not so used or obligated by 
                the end of the fiscal year succeeding the 
                fiscal year in which they are received shall be 
                paid into the Treasury of the United States.]
          (1) Except as provided in paragraphs (2) and (4), any 
        royalties or other payments received by a Federal 
        agency from the licensing and assignment of inventions 
        under agreements entered into by Federal laboratories 
        under section 12, and from the licensing of inventions 
        of Federal laboratories under section 207 of title 35, 
        United States Code, or under any other provision of 
        law, shall be retained by the agency whose laboratory 
        produced the invention and shall be disposed of as 
        follows:
                  (A)(i) The head of the agency or laboratory, 
                or such individual's designee, shall pay each 
                year the first $2,000, and thereafter at least 
                15 percent, of the royalties or other payments 
                to the inventor or coinvestors.
                  (ii) An agency or laboratory may provide 
                appropriate incentives, from royalties or other 
                payments, to employees of laboratory who 
                contribute substantially to the technical 
                development of licensed or assigned inventions 
                between the time that the intellectual property 
                rights to such inventions are legally asserted 
                and the time of the licensing or assigning of 
                the inventions.
                  (iii) The agency or laboratory shall retain 
                the royalties and other payments received from 
                an invention until the agency or laboratory 
                makes payments to employees of a laboratory 
                under clause (i) or (ii).
                  (B) The balance of the royalties or other 
                payments shall be transferred by the agency to 
                its laboratories, with the majority share of 
                the royalties or other payments from any 
                invention going to the laboratory where the 
                invention occurred. The royalties or other 
                payments so transferred to any laboratory may 
                be used or obligated by that laboratory during 
                the fiscal year in which they are received or 
                during the succeeding fiscal year--
                          (i) to reward scientific, 
                        engineering, and technical employees of 
                        the laboratory, including developers of 
                        sensitive or classified technology, 
                        regardless of whether the technology 
                        has commercial applications;
                          (ii) to further scientific exchange 
                        among the laboratories of the agency;
                          (iii) for education and training of 
                        employees consistent with the research 
                        and development missions and objectives 
                        of the agency or laboratory, and for 
                        other activities that increase the 
                        potential for transfer of the 
                        technology of the laboratories of the 
                        agency;
                          (iv) for payment of expenses 
                        incidental to the administration and 
                        licensing of intellectual property by 
                        the agency or laboratory with respect 
                        to inventions made at that laboratory, 
                        including the fees or other costs for 
                        the services of other agencies, 
                        persons, or organizations for 
                        intellectual property management and 
                        licensing services; or
                          (v) for scientific research and 
                        development consistent with the 
                        research and development missions and 
                        objectives of the laboratory.
                  (C) All royalties or other payments retained 
                by the agency or laboratory after payments have 
                been made pursuant to subparagraphs (A) and (B) 
                that is unobligated and unexpended at the end 
                of the second fiscal year succeeding the fiscal 
                year in which the royalties and other payments 
                were received shall be paid into the Treasury.
          (2) If, after payments to inventors under paragraph 
        (1), the royalties or other payments received by an 
        agency in any fiscal year exceed 5 percent of the 
        budget of the Government-operated laboratories of the 
        agency for that year, 75 percent of such excess shall 
        be paid to the Treasury of the United States and the 
        remaining 25 percent may be used or obligated [for the 
        purposes described in clauses (i) through (iv) of 
        paragraph (1)(B) during that fiscal year or the 
        succeeding fiscal year] under paragraph (1)(B). Any 
        funds not so used or obligated shall be paid into the 
        Treasury of the United States.
          (3) Any payment made to an employee under this 
        section shall be in addition to the regular pay of the 
        employee and to any other awards made to the employee, 
        and shall not affect the entitlement of the employee to 
        any regular pay, annuity, or award to which he is 
        otherwise entitled or for which he is otherwise 
        eligible or limit the amount thereof. Any payment made 
        to an inventor as such shall continue after the 
        inventor leaves the laboratory or agency. Payments made 
        under this section shall not exceed [$100,000] $150,000 
        per year to any one person, unless the President 
        approves a larger award (with the excess over 
        [$100,000] $150,000 being treated as a Presidential 
        award under section 4504 of title 5, United States 
        Code).
          (4) A Federal agency receiving royalties or other 
        [income] payments as a result of invention management 
        services performed for another Federal agency or 
        laboratory under section 207 of title 35, United States 
        Code, may retain such royalties or [income] payments to 
        the extent required to offset [the payment of royalties 
        to inventors] payments to inventors under clause (i) of 
        paragraph (1)(A), costs and expenses incurred under 
        [clause (i) of paragraph (1)(B)] clause (iv) of 
        paragraph (1)(B), and the cost of foreign patenting and 
        maintenance for any invention of the other agency. All 
        royalties and other [income] payments remaining after 
        [payment of the royalties,] offsetting the payments to 
        inventors, costs, and expenses described in the 
        preceding sentence shall be transferred to the agency 
        for which the services were performed, for distribution 
        in accordance with [clauses (i) through (iv) of] 
        paragraph (1)(B).
  (b) Certain Assignments.--If the invention involved was one 
assigned to the Federal agency--
          [(1) by a contractor, grantee, or participant in a 
        cooperative agreement with the agency, or]
          (1) by a contractor, grantee, or participant, or an 
        employee of a contractor, grantee, or participant, in 
        an agreement or other arrangement with the agency, or
          (2) by an employee of the agency who was not working 
        in the laboratory at the time the invention was made,
the agency unit that was involved in such assignment shall be 
considered to be a laboratory for purposes of this section.
  (c) Reports.--
          (1) In making their annual budget submissions Federal 
        agencies shall submit, to the appropriate authorization 
        and appropriation committees of both Houses of the 
        Congress, summaries of the amount of royalties or other 
        income received and expenditures made (including 
        inventor awards) under this section.
          (2) The Comptroller General, five years after the 
        date of the enactment of this section, shall review the 
        effectiveness of the various royalty-sharing programs 
        established under this section and report to the 
        appropriate committees of the House of Representatives 
        and the Senate, in a timely manner, his findings, 
        conclusions, and recommendations for improvements in 
        such programs.

Sec.  3710d. Employee activities

  (a) In General.--If a Federal agency which has [the right of 
ownership to an invention under this Act [15 U.S.C. 3701 et 
seq.]] ownership of or the right of ownership to an invention 
made by a Federal employee does not intend to file for a patent 
application or otherwise to promote commercialization of such 
invention, the agency shall allow the inventor, if the inventor 
is a Government employee or former employee who made the 
invention during the course of employment with the Government, 
to obtain or retain title to the invention (subject to 
reservation by the Government of a nonexclusive, 
nontransferable, irrevocable, paid-up license to practice the 
invention or have the invention practiced throughout the world 
by or on behalf of the Government). In addition, the agency may 
condition the inventor's right to title on the timely filing of 
a patent application in cases when the Government determines 
that it has or may have a need to practice the invention.
  (b) Definition.--For purposes of this section, Federal 
employees include special Government employees as defined in 
section 202 of title 18, United States Code.
  (c) Relationship to Other Laws.--Nothing in this section is 
intended to limit or diminish existing authorities of any 
agency.

                         CHAPTER 80--FASTENERS

Sec.  5401. Findings and purpose

  (a) Findings.--The Congress finds that--
          (1) the American economy uses billions of fasteners 
        each year;
          (2) millions of mismarked, substandard, counterfeit, 
        and other nonconforming fasteners have been sold in 
        commerce to end-users in the United States, and their 
        use has dramatically increased the risk of equipment 
        and infrastructure failures;
          (3) both the military and civilian sectors of the 
        economy have encountered unnecessary, unwarranted, and 
        dangerous equipment and construction failures, as well 
        as extraordinary expenses, as a result of the use of 
        nonconforming fasteners;
          [(4) the sale in commerce of nonconforming fasteners 
        and the use of nonconforming fasteners in numerous 
        critical applications have reduced the combat readiness 
        of the Nation's military forces, endangered the safety 
        of other Federal projects and activities, and cost both 
        the public and private sectors large sums in connection 
        with the retesting and purging of fastener 
        inventories;]
          [(5)] (4) the purchase and use of nonconforming 
        fasteners stem from material misrepresentations about 
        such fasteners made by certain manufacturers, 
        importers, and distributors engaged in commerce;
          [(6)] (5) current fastener standards of measurement 
        evaluate bolts and other fasteners according to 
        multiple criteria, including strength, hardness, and 
        composition, and provide grade identification markings 
        on fasteners to make the characteristics of individual 
        fasteners clear to purchasers and users;
          [(7)] (6) current tests required by consensus 
        standards, designed to ensure that fasteners are of 
        standard measure, are adequate and appropriate for use 
        as standards in a program of high-strength fastener 
        testing;
          [(8)] (7) the lack of traceability [by lot number] of 
        fasteners sold in commerce is a serious impediment to 
        effective quality control efforts; and
          [(9)] (8) the health and safety of Americans is 
        threatened by the widespread sale in commerce of 
        mismarked, substandard, and counterfeit fasteners, a 
        practice which also harms American manufacturers, 
        importers, and distributors of safe and conforming 
        fasteners, and workers in the American fastener 
        industry.
  (b) Purpose.--In order to protect public safety, to deter the 
introduction of nonconforming fasteners into commerce, to 
improve the traceability of fasteners [used in critical 
applications,] in commerce, and generally to provide commercial 
and governmental customers with greater assurance that 
fasteners meet stated specifications, it is the purpose of this 
Act [15 U.S.C. 5401 et seq.] to create procedures for the 
testing, certification, and distribution of certain fasteners 
used in commerce within the United States.

Sec.  5402. Definitions

  As used in this Act [15 U.S.C. 5401 et seq.], the term--
          (1) ``alter'' means to alter--
                  (A) by through-hardening,
                  (B) by electroplating of fasteners [having a 
                minimum tensile strength of 150,000 pounds per 
                square inch], or
                  (C) by machining;
          (2) ``consensus standards organization'' means the 
        American Society for Testing and Materials, American 
        National Standards Institute, American Society of 
        Mechanical Engineers, Society of Automotive Engineers, 
        or any other consensus standard-setting organization 
        determined by the Secretary to have comparable 
        knowledge, expertise, and concern for health and safety 
        in the field for which such organization purports to 
        set standards;
          (3) ``container'' means any package of fasteners 
        traded in commerce;
          (4) ``Director'' means the Director of the National 
        Institute of Standards and Technology;
          (5) ``fastener'' means--
                  (A) a--
                          (i) screw, nut, bolt, or stud having 
                        internal or external threads, or
                          (ii) a load-indicating washer,
                with a nominal diameter of 5 millimeters or 
                greater, in the case of such items described in 
                metric terms, or 1/4 inch or greater, in the 
                case of such items described in terms of the 
                English system of measurement, which contains 
                any quantity of metal and is held out as 
                meeting a standard or specification which 
                requires through-hardening,
                  (B) a screw, nut, bolt, or stud having 
                internal or external threads which bears a 
                grade identification marking required by a 
                standard or specification, or
                  (C) a washer to the extent that it is subject 
                to a standard or specification applicable to a 
                screw, nut, bolt, or stud described in 
                subparagraph (B), [or]
                  [(D) any item within a category added by the 
                Secretary in accordance with section 4(b) [15 
                U.S.C. 5403(b)],]
        except that such term does not include any screw, nut, 
        bolt, or stud that is produced and marked as ASTM A 307 
        Grade A or produced in accordance with ASTM F 432;
          (6) ``grade identification marking'' means any symbol 
        appearing on a fastener purporting to indicate that the 
        fastener's base material, strength properties, or 
        performance capabilities conform to a specific standard 
        of a consensus standards organization or [other person] 
        government agency;
          (7) ``importer'' means a person located within the 
        United States who contracts for the initial purchase of 
        fasteners manufactured outside the United States for 
        resale or such person's use within the United States;
          (8) ``Institute'' means the National Institute of 
        [Standard] Standards and Technology;
          (9) ``lot'' means a quantity of fasteners of one part 
        number fabricated by the same production process from 
        the same coil or heat number of metal as provided by 
        the metal manufacturer and submitted for inspection and 
        testing at one time;
          (10) ``manufacturer'' means a person who fabricates 
        fasteners, or who alters any item so that it becomes a 
        fastener;
          [(11) ``original equipment manufacturer'' means a 
        person who uses fasteners in the manufacture or 
        assembly of its products and sells fasteners to 
        authorized dealers as replacement or service parts for 
        its products;]
          [(12)] (11) ``private label distributor'' means a 
        person who contracts with a manufacturer for the 
        fabrication of fasteners bearing the distributor's 
        distinguishing insignia;
          [(13)] (12) ``Secretary'' means the Secretary of 
        Commerce;
          [(14)] (13) ``standard and specifications'' means the 
        provisions of a document published by a consensus 
        standards organization, [a government agency, or a 
        major end-user of fasteners which defines or describes 
        dimensional characteristics, limits of size, acceptable 
        materials, processing, functional behavior, plating, 
        baking, inspecting, testing, packaging, and required 
        markings of any fastener] or a government agency; and
          [(15)] (14) ``through-harden'' means heating above 
        the transformation temperature followed by quenching 
        and tempering for the purpose of achieving a uniform 
        hardness.

[Sec.  5403. Special rules for fasteners]

  [(a) Waiver Requirement.--If the Secretary determines that 
any category of fastener is not used in critical applications, 
the Secretary shall waive the requirements of this Act with 
respect to such category.
  [(b) Additional Items.--If the Secretary determines that--
          [(1) a category of screw, nut, bolt, or stud which is 
        not described in section 3(5)(A)(i) or (B),
          [(2) a category of item which is associated with a 
        fastener described in section 3(5)(A), (B), or (C), or
          [(3) a category of item which serves a function 
        comparable to that served by a fastener so described
is used in critical applications, the Secretary may include 
such category under section 3(5)(D) and therefore within the 
definition of fasteners under this Act.
  [(c) Notice and Opportunity for Comments.--The Secretary 
shall provide advance notice and the opportunity for public 
comments prior to making any determination under subsections 
(a) and (b) and shall act through the Director in making any 
such determination.]

Sec.  5404. Testing and certification of fasteners

  (a) Requirement.--
          (1) No fastener shall be offered for sale or sold in 
        commerce unless it is part of a lot which--
                  (A) conforms to the standards and 
                specifications to which the manufacturer 
                represents it has been manufactured; and
                  (B) has been inspected, tested, and certified 
                as provided in [subsections (b) and (c)] 
                subsections (b), (c), and (d) of this section.
          (2)(A) Paragraph (1)(B) of this subsection shall not 
        apply to fasteners which are part of a lot of 50 
        fasteners or less if, within 10 working days after the 
        delivery of such fasteners, or as soon as practicable 
        thereafter--
                  (i) inspection, testing, and certification as 
                provided in subsections (b) and (c) is carried 
                out; and
                  (ii) written notice detailing the results of 
                such inspection, testing, and certification is 
                sent (I) to all purchasers of such fasteners, 
                except retail sellers and retail consumers, and 
                (II) to any retail seller or retail consumer 
                who, prior to delivery, requests such written 
                notice.
          (B) If a fastener is sold under this paragraph, each 
        purchaser of such fastener, except for retail sellers 
        and retail consumers unless such retail sellers and 
        retail consumers request such notice in advance, shall 
        be provided, contemporaneously with each sale and 
        delivery, written notice stating that such fastener has 
        not yet been inspected, tested, and certified as 
        required by this Act [15 U.S.C. 5401 et seq.].
  (b) Inspection and Testing.--
          (1) The manufacturer of a lot of fasteners shall 
        cause to be inspected and tested a representative 
        sample, as provided in paragraph (2) of this 
        subsection, of the fasteners in such lot to determine 
        whether the lot conforms to the standards and 
        specifications to which the manufacturer represents it 
        has been manufactured. Such inspection and testing 
        shall be performed by a laboratory accredited in 
        accordance with the procedures and conditions specified 
        by the Secretary under section 6 [15 U.S.C. 5405]. The 
        standards and specifications to which the manufacturer 
        represents such lot has been manufactured shall be 
        disclosed by the manufacturer to the laboratory at the 
        time the lot is submitted for inspection and testing 
        under this paragraph. The manufacturer of a lot may 
        perform the inspection and testing required by this 
        paragraph in a laboratory which it owns or with which 
        it is otherwise affiliated, if such laboratory is 
        accredited in accordance with the procedures and 
        conditions specified by the Secretary under section 6 
        [15 U.S.C. 5405]; unless the Secretary finds that, as 
        to a specific type of fastener and as to a specific 
        type of inspection or testing, a ban on manufacturer 
        ownership or affiliation with the accredited laboratory 
        would increase the protection of health and safety of 
        the public or industrial workers.
          (2) The size, selection, and integrity of the sample 
        to be inspected and tested under paragraph (1) shall be 
        governed--
                  (A) by the standards and specifications to 
                which the manufacturer represents the fasteners 
                in the sample have been manufactured; or
                  (B) if such standards and specifications do 
                not provide for the size, selection, or 
                integrity of the sample, by sampling procedures 
                prescribed by the Secretary, who shall to the 
                extent practicable use consensus testing 
                standards and related materials.
        Nothing in this paragraph shall prohibit a purchaser 
        from requiring the inspection and testing of a greater 
        number of fasteners from a lot than is specified in the 
        applicable standards and specifications or in the 
        applicable sampling procedures prescribed by the 
        Secretary.
  (c) Laboratory report of testing.--If a laboratory performing 
the inspection and testing under subsection (b)(1) determines, 
as to the characteristics selected under the sampling 
procedures prescribed by the Secretary and based on the sample 
examined, that a lot conforms to the standards and 
specifications which the manufacturer represents it has been 
manufactured, the laboratory shall provide to the manufacturer 
a written inspection and testing report with respect to such 
lot. The report, which shall be in a form prescribed by the 
Secretary by regulation, shall--
          (1) state the manufacturer's name, the part 
        description, and the lot number and note the grade 
        identification mark and insignia found on the fastener;
          (2) reference the standards and specifications 
        disclosed by the manufacturer with respect to such lot 
        under subsection (b)(1) [or, where applicable, 
        certified by the manufacturer under section 7(c)(1) [15 
        U.S.C. 5406(c)(1)]];
          (3) list the markings and characteristics selected 
        under the Secretary's procedures for testing, [such as 
        the chemical, dimensional, physical, mechanical, and 
        any other] significant characteristics required by the 
        standards and specifications described in paragraph (2) 
        and specify the results of the inspection and testing 
        under subsection (b)(1);
          (4) except as provided in subsection (d), state 
        whether, based on the samples provided as 
        representative of the lot, such lot has been found 
        after such inspection and testing to conform to such 
        standards and specifications; and
          (5) bear the original signature of a laboratory 
        employee or officer determined by the Secretary to be 
        responsible for the accuracy of the report and of the 
        inspection and testing to which it relates.
  (d) Alternative Procedure for Chemical Characteristics._
Notwithstanding the requirements of subsections (b) and (c), a 
manufacturer shall be deemed to have demonstrated, for purposes 
of subsection (a)(1), that the chemical characteristics of a 
lot conform to the standards and specifications to which the 
manufacturer represents such lot has been manufactured if the 
following requirements are met:
          (1) The coil or heat number of metal from which such 
        lot was fabricated has been inspected and tested with 
        respect to its chemical characteristics by a laboratory 
        accredited in accordance with the procedures and 
        conditions specified by the Secretary under section 6.
          (2) Such laboratory has provided to the manufacturer, 
        either directly or through the metal manufacturer, a 
        written inspection and testing report, which shall be 
        in a form prescribed by the Secretary by regulation, 
        listing the chemical characteristics of such coil or 
        heat number.
          (3) The report described in paragraph (2) indicates 
        that the chemical characteristics of such coil or heat 
        number conform to those required by the standards and 
        specifications to which the manufacturer represents 
        such lot has been manufactured.
          (4) The manufacturer demonstrates that such lot has 
        been fabricated from the coil or heat number of metal 
        to which the report described in paragraphs (2) and (3) 
        relates.
In prescribing the form of report required by subsection (c), 
the Secretary shall provide for an alternative to the statement 
required by subsection (c)(4), insofar as such statement 
pertains to chemical characteristics, for cases in which a 
manufacturer elects to use the procedure permitted by this 
subsection.

Sec.  5405. Laboratory accreditation

  (a) Establishment of Accreditation Program.--
          (1) [Within 180 days after the date of enactment of 
        this Act, the] The Secretary, acting through the 
        Director, shall issue regulations which shall include--
                  (A) procedures and conditions, including 
                sampling procedures referred to in section 5 
                [15 U.S.C. 5404], for the accreditation by the 
                Institute of laboratories engaged in the 
                inspection and testing of fasteners under 
                section 5 [15 U.S.C. 5404];
                  (B) procedures and conditions (which shall be 
                consistent with the procedures and conditions 
                established under subparagraph (A)), using to 
                the extent practicable the requirements of 
                national or international consensus documents 
                intended to govern the operation of 
                accreditation bodies, under which private 
                entities may apply for approval by the 
                Secretary to engage directly in the 
                accreditation of laboratories in accordance 
                with the requirements of this Act [15 U.S.C. 
                5401 et seq.]; and
                  (C) conditions (which shall be consistent 
                with the procedures and conditions established 
                under subparagraph (A)), under which the 
                accreditation of foreign laboratories by their 
                governments or organizations recognized by the 
                Director shall be deemed to satisfy the 
                laboratory accreditation requirements of this 
                section.
          (2) Upon establishing a laboratory accreditation 
        program under paragraph (1), the Secretary shall 
        publish a notice in the Federal Register stating that 
        the Secretary is prepared to accept applications for 
        accreditation of such laboratories.
          (3) No accreditation provided under the terms of this 
        subsection shall be effective for a period of greater 
        than 3 years.
  (b) Laboratory Accreditation Procedures.--Existing Institute 
accreditation procedures stated in part 7 of title 15, Code of 
Federal Regulations, as in effect on the date of enactment of 
this Act, supplemented as the Secretary considers necessary, 
shall be used to accredit laboratories under the accreditation 
program established under subsection (a).
  (c) Ensuring Compliance.--
          (1) The Secretary shall ensure that--
                  (A) private entities accrediting laboratories 
                under procedures and conditions established 
                under subsection (a)(1)(B) comply with such 
                procedures and conditions, and
                  (B) laboratories accredited by such private 
                entities, or by foreign governments pursuant to 
                subsection (a)(1)(C), comply with the 
                requirements for such accreditation.
          (2) The Secretary may require any such private entity 
        or laboratory to provide all records and materials that 
        may be necessary to allow the Secretary to carry out 
        this subsection.
  (d) Operation of Laboratory Accreditation Program.--
          (1) The Director may hire such contractors as are 
        necessary to carry out the accreditation program 
        established under subsection (a).
          (2) Costs to the Institute and to the Secretary for 
        the establishment and operation of the accreditation 
        program under this section shall be fully reimbursable 
        to the Institute or to the Secretary, as appropriate, 
        through fees or other charges for accreditation 
        services under such program.
  (e) Recommendations to Consensus Standards Organizations.--
The Director shall periodically transmit to appropriate 
consensus standards organizations any information or 
recommendations that may be useful in the establishment or 
application by such organizations of standards and 
specifications for fasteners.

Sec.  5406. Sale of fasteners subsequent to manufacture

  [(a) Domestically Produced Fasteners.--It shall be unlawful 
for a manufacturer to sell any shipment of fasteners (except 
fasteners for which the Secretary has waived the requirements 
of this Act [15 U.S.C. 5401 et seq.] pursuant to section 4 [15 
U.S.C. 5403]) which are manufactured in the United States 
unless the fasteners are accompanied, at the time of delivery, 
by a written certificate by the manufacturer certifying that--
          [(1) the fasteners have been manufactured according 
        to the requirements of the applicable standards and 
        specifications and have been inspected and tested by a 
        laboratory accredited in accordance with the procedures 
        and conditions specified by the Secretary under section 
        6 [15 U.S.C. 5405]; and
          [(2) an original laboratory testing report described 
        in section 5(c) [15 U.S.C. 5404(c)] is on file with the 
        manufacturer, or under such custody as may be 
        prescribed by the Secretary, and available for 
        inspection.]
  (a) Domestically Produced Fasteners._It shall be unlawful for 
a manufacturer to sell any shipment of fasteners covered by 
this Act which are manufactured in the United States unless the 
fasteners--
          (1) have been manufactured according to the 
        requirements of the applicable standards and 
        specifications and have been inspected and tested by a 
        laboratory accredited in accordance with the procedures 
        and conditions specified by the Secretary under section 
        6; and
          (2) an original laboratory testing report described 
        in section 5(c) and a manufacturer's certificate of 
        conformance are on file with the manufacturer, or under 
        such custody as may be prescribed by the Secretary, and 
        available for inspection.
  (b) Fasteners of Foreign Origin.--
          (1) Except as provided in paragraph (2) of this 
        subsection, it shall be unlawful--
                  (A) for any person to sell to any importer, 
                and
                  (B) for any importer to purchase,
        any shipment of fasteners which are manufactured 
        outside the United States unless delivery of such 
        shipment to such importer is accompanied by a 
        manufacturer's certificate as described in subsection 
        (a), an original laboratory testing report described in 
        section 5(c) [15 U.S.C. 5404(c)], with respect to each 
        lot from which such fasteners were taken, and any other 
        relevant lot identification information.
          (2) The requirement under paragraph (1) of this 
        subsection that the delivery of such a shipment to such 
        importer be accompanied by an original laboratory 
        testing report shall not apply in the case of fasteners 
        imported into the United States--
                  (A) as products manufactured within a nation 
                which is party to a congressionally-approved 
                free trade agreement with the United States 
                that is in effect, so long as the Secretary 
                certifies that satisfactory arrangements have 
                been reached by which purchasers within the 
                United States can readily gain access to an 
                original laboratory testing report for such 
                fasteners; or
                  (B) as Canadian-origin products under the 
                United States-Canada Automobile Pact for use as 
                original equipment in the manufacture of motor 
                vehicles.
  (c) Option for Importers and Private Label Distributors.--
          (1) Notwithstanding section 5(a) [15 U.S.C. 5404(a)] 
        and subsections (a) and (b) of this section, delivery 
        of a lot, or portion of a lot, of fasteners may be made 
        to an importer or private label distributor without the 
        required original copy of the laboratory testing report 
        if--
                  (A) the manufacturer provides to the importer 
                or private label distributor a manufacturer's 
                certificate certifying that the fasteners have 
                been manufactured according to the requirements 
                of the applicable standards and specifications; 
                and
                  (B) the importer or private label distributor 
                assumes responsibility in writing for the 
                inspection and testing of such lot or portion 
                by a laboratory accredited in accordance with 
                the procedures and conditions specified by the 
                Secretary under section 6 [15 U.S.C. 5405].
          (2) If the importer or private label distributor 
        assumes the responsibility in writing for the 
        inspection and testing of such lot or portion, the 
        provisions of section 5(a) [15 U.S.C. 5404(a)] and 
        subsections (a) and (b) of this section shall apply to 
        the importer or private label distributor in the same 
        manner and to the same extent as to a manufacturer; 
        except that the importer or private label distributor 
        shall provide to the testing laboratory the 
        manufacturer's certificate described under paragraph 
        (1) of this subsection.
  (d) Alterations Subsequent to Manufacture.--
          (1) Any person who significantly alters a fastener so 
        that such fastener no longer conforms to the 
        description in the relevant [certificate] test report 
        issued under section 5(c) [15 U.S.C. 5404(c)], and who 
        thereafter offers for sale or sells such altered 
        fastener, shall be treated as a manufacturer for 
        purposes of this Act [15 U.S.C. 5401 et seq.] and shall 
        cause such altered fastener to be inspected and tested 
        under section 5 [15 U.S.C. 5404] of this section as 
        though it were newly manufactured, unless delivery of 
        such fastener to the purchaser is accompanied by a 
        written statement noting the original lot number, 
        disclosing the subsequent alteration, and warning that 
        such alteration may affect the dimensional or physical 
        characteristics of the fastener.
          (2) Any person who knowingly sells an altered 
        fastener and who did not alter such fastener shall 
        provide to the purchaser a copy of the statement 
        required by paragraph (1).
  [(e) Commingling.--
          [(1) Subject to paragraph (2), it shall be unlawful 
        for any manufacturer or any person who purchases any 
        quantity of fasteners for resale at wholesale to 
        commingle like fasteners from different lots in the 
        same container; except that such manufacturer or such 
        person may commingle like fasteners of the same type, 
        grade, and dimension from not more than two tested and 
        certified lots in the same container during repackaging 
        and plating operations: Provided, That any container 
        which contains like fasteners from two lots shall be 
        conspicuously marked with the lot identification 
        numbers of both lots.
          [(2) Paragraph (1) does not apply to sales by 
        original equipment manufacturers to their authorized 
        dealers for use in assembling or servicing products 
        produced by the original equipment manufacturers.]
  (e) Commingling._It shall be unlawful for any manufacturer, 
importer, or private label distributor to commingle like 
fasteners from different lots in the same container; except 
that such manufacturer, importer, or private label distributor 
may commingle like fasteners of the same type, grade, and 
dimension from not more than two tested and certified lots in 
the same container during repackaging and plating operations: 
Provided, that any container which contains the fasteners from 
two lots shall be conspicuously marked with the lot 
identification numbers of both lots.
  [(f) Subsequent Purchaser.--
          [(1) It shall be unlawful for any person to sell 
        fasteners, of any quantity, to any person who purchases 
        such fasteners--
                  [(A) for sale at wholesale, or
                  [(B) for assembling components of a product 
                or structure for sale,
        unless the container of fasteners sold is conspicuously 
        marked with the number of the lot from which such 
        fasteners were taken, except that this requirement 
        shall not apply to sales by original equipment 
        manufacturers to their authorized dealers for use in 
        assembling or servicing products produced by the 
        original equipment manufacturer.
          [(2) If a person who purchases fasteners for purposes 
        other than those described in paragraph (1) (A) and (B) 
        so requests either prior to the sale or at the time of 
        sale, the seller shall conspicuously mark the container 
        of fasteners with the lot number from which such 
        fasteners were taken.]
  (f) Subsequent Purchaser._If a person who purchases fasteners 
for any purpose so requests either prior to the sale or at the 
time of sale, the seller shall conspicuously mark the container 
of the fasteners with the lot number from which such fasteners 
were taken.
  (g) Regulations.--The Secretary may issue such regulations as 
may be necessary to ensure compliance with the provisions of 
this section.

Sec.  5408. Remedies and penalties

  (a) Civil Remedies.--
          (1) The Attorney General may bring an action in an 
        appropriate United States district court for 
        appropriate declaratory and injunctive relief against 
        any person who violates this Act [15 U.S.C. 5401 et 
        seq.] or any regulation under this Act.
          (2) An action under paragraph (1) may not be brought 
        more than 10 years after the date on which the cause of 
        action accrues.
  (b) Civil Penalties.--
          (1) Any person who is determined by the Secretary, 
        after notice and an opportunity for a hearing, to have 
        violated this Act [15 U.S.C. 5401 et seq.] or any 
        regulation under this Act shall be liable to the United 
        States for a civil penalty of not more than $25,000 for 
        each violation.
          (2) The amount of the penalty shall be assessed by 
        the Secretary by written notice. In determining the 
        amount of the penalty, the Secretary shall consider the 
        nature, circumstances, and gravity of the violation 
        and, with respect to the person found to have committed 
        the violation, the degree of culpability, any history 
        of prior violations, the effect on ability to continue 
        to do business, any good faith attempt to achieve 
        compliance, ability to pay the penalty, and such other 
        matters as justice may require.
          (3) Any person against whom a civil penalty is 
        assessed under paragraph (2) of this section may obtain 
        review thereof in the appropriate court of the United 
        States by filing a notice of appeal in such court 
        within 30 days from the date of such order and by 
        simultaneously sending a copy of such notice by 
        certified mail to the Secretary. The findings and order 
        of the Secretary shall be set aside by such court if 
        they are found to be unsupported by substantial 
        evidence, as provided in section 706(2) of title 5, 
        United States Code.
          (4) The Secretary may compromise, modify, or remit, 
        with or without conditions, any civil penalty which is 
        subject to imposition or which has been imposed under 
        this section prior to referral to the Attorney General 
        under paragraph (5).
          (5) A civil penalty assessed under this subsection 
        may be recovered in an action brought by the Attorney 
        General on behalf of the United States in the 
        appropriate district court of the United States. In 
        such action, the validity and appropriateness of the 
        final order imposing the civil penalty shall not be 
        subject to review.
          (6) For the purpose of conducting any hearing under 
        this section, the Secretary may issue subpoenas for the 
        attendance and testimony of witnesses and the 
        production of relevant papers, books, and documents, 
        and may administer oaths. Witnesses summoned shall be 
        paid the same fees and mileage that are paid to 
        witnesses in the courts of the United States. In case 
        of contempt or refusal to obey a subpoena served upon 
        any person pursuant to this paragraph, the district 
        court of the United States for any district in which 
        such person is found, resides, or transacts business, 
        upon application by the United States and after notice 
        to such person, shall have jurisdiction to issue an 
        order requiring such person to appear and give 
        testimony before the Secretary or to appear and produce 
        documents before the Secretary, or both, and any 
        failure to obey such order of the court may be punished 
        by such court as a contempt thereof.
  (c) Criminal Penalties.--
          (1) Whoever knowingly certifies, marks, offers for 
        sale, or sells a fastener in violation of this Act [15 
        U.S.C. 5401 et seq.] or a regulation under this Act 
        shall be fined under title 18, United States Code [18 
        U.S.C. 1 et seq.], or imprisoned not more than 5 years, 
        or both.
          (2) Whoever intentionally fails to maintain records 
        relating to a fastener in violation of this Act or a 
        regulation under this Act [15 U.S.C. 5401 et seq.] 
        shall be fined under title 18, United States Code [18 
        U.S.C. 1 et seq.], or imprisoned not more than 5 years, 
        or both.
          (3) Whoever negligently fails to maintain records 
        relating to a fastener in violation of this Act [15 
        U.S.C. 5401 et seq.] or a regulation under this Act 
        shall be fined under title 18, United States Code [18 
        U.S.C. 1 et seq.], or imprisoned not more than 2 years, 
        or both.
  (d) Enforcement._The Secretary may designate officers or 
employees of the Department of Commerce to conduct 
investigations pursuant to this Act. In conducting such 
investigations, those officers or employees may, to the extent 
necessary or appropriate to the enforcement of this Act, 
exercise such authorities as are conferred upon them by other 
laws of the United States, subject to policies and procedures 
approved by the Attorney General.

Sec.  5409. Recordkeeping requirements

  (a) Laboratories.--Laboratories which perform inspections and 
testing under section 5(b) [15 U.S.C. 5404(b)] shall retain for 
[10 years] 5 years all records concerning the inspection and 
testing, and certification, of fasteners under section 5 [15 
U.S.C. 5404].
  (b) Manufacturers, Importers, Private Label Distributors, and 
Persons Who Make Significant Alterations.--Manufacturers, 
importers, private label distributors, and persons who make 
significant alterations shall retain for [10 years] 5 years all 
records concerning the inspection and testing, and 
certification, of fasteners under section 5 [15 U.S.C. 5401 et 
seq.], and shall provide copies of any applicable laboratory 
testing report or manufacturer's certificate upon request to 
[any subsequent] the subsequent purchaser of fasteners taken 
from the lot to which such testing report or manufacturer's 
certificate relates.

Sec.  5412. Regulations

  The Secretary shall [within 180 days after the date of 
enactment of this Act] issue such regulations as may be 
necessary to implement this Act [15 U.S.C. 5401 et seq.].

[Sec.  5413. Advisory committee]

  [Within 90 days after the date of enactment of this Act, the 
Secretary shall appoint an advisory committee consisting of 
representatives of fastener manufacturers, importers, 
distributors, end-users, independent laboratories, and 
standards organizations. The Secretary and Director shall 
consult with the advisory committee--
          [(1) prior to promulgating any regulations under this 
        Act [15 U.S.C. 5401 et seq.]; and
          [(2) in such other matters related to fasteners as 
        the Secretary may determine.]

                      TITLE 35, UNITED STATES CODE

       PART II--PATENTABILITY OF INVENTIONS AND GRANT OF PATENTS

  CHAPTER 18--PATENT RIGHTS IN INVENTIONS MADE WITH FEDERAL ASSISTANCE

Sec.  210. Precedence of chapter

  (a) This chapter [35 U.S.C. 200 et seq.] shall take 
precedence over any other Act which would require a disposition 
of rights in subject inventions of small business firms or 
nonprofit organizations contractors in a manner that is 
inconsistent with this chapter [35 U.S.C. 200 et seq.], 
including but not necessarily limited to the following:
          (1) section 10(a) of the Act of June 29, 1935, as 
        added by title I of the Act of August 14, 1946 (7 
        U.S.C. 427i(a); 60 Stat. 1085);
          (2) section 205(a) of the Act of August 14, 1946 (7 
        U.S.C. 1624(a); 60 Stat. 1090);
          (3) section 501(c) of the Federal Mine Safety and 
        Health Act of 1977 (30 U.S.C. 951(c); 83 Stat. 742);
          (4) section 30168(e) of title 49;
          (5) section 12 of the National Science Foundation Act 
        of 1950 (42 U.S.C. 1871(a); 82 Stat. 360);
          (6) section 152 of the Atomic Energy Act of 1954 (42 
        U.S.C. 2182; 68 Stat. 943);
          (7) section 305 of the National Aeronautics and Space 
        Act of 1958 (42 U.S.C. 2457);
          (8) section 6 of the Coal Research Development Act of 
        1960 (30 U.S.C. 666; 74 Stat. 337);
          (9) section 4 of the Helium Act Amendments of 1960 
        (50 U.S.C. 167b; 74 Stat. 920);
          (10) section 32 of the Arms Control and Disarmament 
        Act of 1961 (22 U.S.C. 2572; 75 Stat. 634);
          (11) subsection (e) of section 302 of the Appalachian 
        Regional Development Act of 1965 (40 U.S.C. App. 
        302(e); 79 Stat. 5);
          (12) section 9 of the Federal Nonnuclear Energy 
        Research and Development Act of 1974 (42 U.S.C. 5908; 
        88 Stat. 1878);
          (13) section 5(d) of the Consumer Product Safety Act 
        (15 U.S.C. 2054(d); 86 Stat. 1211);
          (14) section 3 of the Act of April 5, 1944 (30 U.S.C. 
        323; 58 Stat. 191);
          (15) section 8001(c)(3) of the Solid Waste Disposal 
        Act (42 U.S.C. 6981(c); 90 Stat. 2829);
          (16) section 219 of the Foreign Assistance Act of 
        1961 (22 U.S.C. 2179; 83 Stat. 806);
          (17) section 427(b) of the Federal Mine Health and 
        Safety Act of 1977 (30 U.S.C. 937(b); 86 Stat. 155);
          (18) section 306(d) of the Surface Mining and 
        Reclamation Act of 1977 (30 U.S.C. 1226(d); 91 Stat. 
        455);
          (19) section 21(d) of the Federal Fire Prevention and 
        Control Act of 1974 (15 U.S.C. 2218(d); 88 Stat. 1548);
          (20) section 6(b) of the Solar Photovoltaic Energy 
        Research Development and Demonstration Act of 1978 (42 
        U.S.C. 5585(b); 92 Stat. 2516);
          (21) section 12 of the Native Latex Commercialization 
        and Economic Development Act of 1978 (7 U.S.C. 178(j); 
        92 Stat. 2533); and
          (22) section 408 of the Water Resources and 
        Development Act of 1978 (42 U.S.C. 7879; 92 Stat. 
        1360).
The Act creating this chapter shall be construed to take 
precedence over any future Act unless that Act specifically 
cites this Act and provides that it shall take precedence over 
this Act.
  (b) Nothing in this chapter [35 U.S.C. 200 et seq.] is 
intended to alter the effect of the laws cited in paragraph (a) 
of this section or any other laws with respect to the 
disposition of rights in inventions made in the performance of 
funding agreements with persons other than nonprofit 
organizations or small business firms.
  (c) Nothing in this chapter [35 U.S.C. 200 et seq.] is 
intended to limit the authority of agencies to agree to the 
disposition of rights in inventions made in the performance of 
work under funding agreements with persons other than nonprofit 
organizations or small business firms in accordance with the 
Statement of Government Patent Policy issued on February 18, 
1983, agency regulations, or other applicable regulations or to 
otherwise limit the authority of agencies to allow such persons 
to retain ownership of inventions. Any disposition of rights in 
inventions made in accordance with the Statement or 
implementing regulations, including any disposition occurring 
before enactment of this section, are hereby authorized except 
that all funding agreements, including those with other than 
small business firms and nonprofit organizations, shall include 
the requirements established in paragraph 202(c)(4) and section 
203 of this title.
  (d) Nothing in this chapter [35 U.S.C. 200 et seq.] shall be 
construed to require the disclosure of intelligence sources or 
methods or to otherwise affect the authority granted to the 
Director of Central Intelligence by statute or Executive order 
for the protection of intelligence sources or methods.
  (e) The provisions of the Stevenson-Wydler Technology 
Innovation Act of 1980 [15 U.S.C. 3701 et seq.], [as amended by 
the Federal Technology Transfer Act of 1986 [15 U.S.C. 3701 et 
seq.],] shall take precedence over the provisions of this 
chapter to the extent that they permit or require a disposition 
of rights in subject inventions which is inconsistent with this 
chapter.

                                
