[Federal Register Volume 68, Number 162 (Thursday, August 21, 2003)]
[Rules and Regulations]
[Pages 50646-50670]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-21172]



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Part III





Department of Energy





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10 CFR Part 600



Financial Assistance Regulations; Final Rule

  Federal Register / Vol. 68, No. 162 / Thursday, August 21, 2003 / 
Rules and Regulations  

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DEPARTMENT OF ENERGY

10 CFR Part 600

RIN 1991-AB57


Financial Assistance Regulations

AGENCY: Department of Energy.

ACTION: Final rule.

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SUMMARY: The Department of Energy (DOE) is amending its Assistance 
Regulations by adding a new subpart, making minor amendments to 
existing subparts to reflect this change, and eliminating a section 
that contains internal procedures for DOE officials or requirements 
that are contained in other sections. The new subpart establishes 
administrative requirements for awards to for-profit organizations and 
eliminates the need to apply existing uniform administrative 
requirements, applicable to institutions of higher education, 
hospitals, and other nonprofit organizations, to awards with for-profit 
organizations.

EFFECTIVE DATE: This rule will become effective October 1, 2003.

FOR FURTHER INFORMATION CONTACT: Ms. Trudy Wood, Office of Procurement 
and Assistance Policy, Department of Energy, at (202) 586-5625.

SUPPLEMENTARY INFORMATION: 

I. Background
II. Discussion of Public Comments
III. Revisions Incorporated in This Final Rule
IV. Procedural Requirements
    A. Review Under Executive Order 12866
    B. Review Under the Regulatory Flexibility Act
    C. Review Under the Paperwork Reduction Act
    D. Review Under the National Environmental Policy Act
    E. Review Under Executive Order 13132
    F. Review Under Executive Order 12988
    G. Review Under the Unfunded Mandates Reform Act of 1995
    H. Review Under the Treasury and General Government 
Appropriations Act, 1999
    I. Review Under the Treasury and General Government 
Appropriations Act, 2001
    J. Review Under Executive Order 13211
    K. Review Under the Small Business Regulatory Enforcement 
Fairness Act
V. Approval of the Office of the Secretary of Energy

I. Background

    Office of Management and Budget (OMB) Circular A-110 provides 
uniform requirements for the administration of grants and agreements 
with institutions of higher education, hospitals, and other nonprofit 
organizations. OMB Circular A-110 also states that ``Federal agencies 
may apply the provisions of this Circular to commercial organizations. 
* * *'' Consistent with this guidance, when DOE implemented the 
rrequirments of Circular A-110 in its financial assistance regulations 
at 10 CFR part 600, subpart B, the Department, as a matter of 
discretion, also applied the provisions of the Circular to commerical 
organizations.
    This rulemaking began with DOE publishing a notice in the Federal 
Register on May 8, 2001, 66 FR 23197, requesting comments on whether 
DOE should initiate a rulemaking to establish administrative 
requirements for financial assistance awards tailored specifically to 
for-profit organizations. Respondents strongly endorsed the concept of 
administrative requirements specifically tailored to for-profit 
organizations.
    DOE published a Notice of Proposed Rulemaking (NOPR) in the Federal 
Register on August 26, 2002, 67 FR 54850. The NOPR proposed adding a 
new subpart D--Uniform Administrative Requirements for Grants and 
Cooperative Agreements With For-Profit Organizations. This subpart 
contained provisions similar to those in subpart B--Uniform 
Administrative Requirements for Grants and Cooperative Agreements with 
Institutions of Higher Education, Hospitals, Other Nonprofit 
Organizations and Commercial Organizations, but the provisions had been 
tailored specifically for awards to for-profits organizations. The NOPR 
also proposed that for-profit organizations subject to subpart D be 
relieved of obligations that would otherwise apply under subpart B.
    The following section presents a summary of the major comments 
grouped by subject, and the responses to the comments. Where 
appropriate, the responses explain how we have changed the proposed 
subpart D in the final rule.

I. Discussion of Public Comments

Comments on Audit Requirements

    Comment: The proposed section 600.316 is helpful from the point of 
view of publicly held firms but may be an additional and unnecessary 
burden for non-publicly held companies. The benefit in terms of 
assurance of proper use of the public funds might not be produced in a 
way that is proportional to the cost and effort involved. The 
contracting officer should be empowered to require the recipient to 
have an independent auditor arrange for a precise checking of the 
financial details and non-financial activities needed to assure the 
proper use of the public funds. For example, if the recipient is 
working under a cost-share arrangement, where the contractor is 
furnishing service for which a price per hour or day has been agreed, 
an audit of costs and general accounting practices would return no 
value but an audit of whether the services had been provided as 
reported would be of high value. The requirement should be revised to 
allow this type of practice rather than a full scale audit.
    Response: Proposed section 600.316 would not require a full scale 
audit. It would require a recipient that expends $500,000 or more in a 
year under Federal awards to have an audit made for that year by an 
independent auditor in accordance with the requirements in paragraph 
(b) of that section. These requirements are similar to the requirements 
of the Single Audit Act, as implemented by the Office of Management and 
Budget Circular A-133, ``Audits of States, Local Governments, and Non-
profit Organizations.'' In addition, the recipient may elect to have 
the award separately audited if it is more economical, unless the award 
terms and conditions or Federal laws or regulations specify otherwise. 
For both cost shared and non-cost shared awards, the Government needs 
reasonable assurance that the recipient has an effective internal 
control structure (e.g., control over and accountability for cash and 
property) and is complying with Federal laws and regulations and the 
terms and conditions of the award (e.g., whether the services have been 
provided as reported).

Comment on Property Management Requirements

    Comment: The requirements under proposed section 600.323, 
``Property management system,'' appear to be the same as the property 
requirements for assistance agreements with institutions of higher 
education, hospitals, and other non-profit organizations. These 
requirements would involve special record keeping that is similar to 
the Federal Acquisition Regulation (FAR) property clauses. It is 
requested that these requirements be further aligned with the voluntary 
standard that commercial organizations already follow.
    Response: The voluntary standard for customer property management 
systems, established by the International Organization for 
Standardization (commonly referred to as the ISO), merely provides that 
organizations: (1) Exercise care with customer property; (2) identify, 
verify, protect and safeguard customer property; and (3) if property is 
lost, damaged or found unsuitable for use, report to the customer and 
maintain records. To

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ensure uniformity and consistency in the management of property under 
financial assistance awards, DOE believes more specificity is needed. 
Using the OMB Circular A-110, ``Uniform Administrative Requirements for 
Grants and Agreements with Institutions of Higher Education, Hospitals, 
and Other Nonprofit Organizations'' as a guide, the Department 
developed and incorporated into proposed section 600.323 a streamlined 
set of requirements. We believe that this set of requirements is the 
minimum necessary to ensure the proper stewardship of property under 
financial assistance awards.

Comments on Intellectual Property Matters

    Comment: Paragraph (c)(1) of proposed section 600.325 would provide 
that if a recipient is a large business, the agreement must include the 
clause giving ownership of inventions to DOE, unless there is an 
advance waiver. DOE should relieve the parties of the burden of 
justifying an advance waiver on a case-by-case basis, and provide to 
large business recipients treatment similar to that provided to small 
business, i.e., title waived but Government purpose license retained.
    Response: DOE operates under statutory mandates to obtain title to 
subject inventions, unless a patent waiver is granted (42 U.S.C. 2182; 
42 U.S.C. 5908(c)). Patent waivers are to be granted only upon 
consideration of a number of factors specified by statute. While DOE 
has granted ``class waivers'' where appropriate for specific programs, 
DOE does not believe it has authority to grant a ``class waiver'' for 
all assistance programs, as requested by the commenter. Nevertheless, 
DOE is considering mechanisms for ``streamlining'' the patent waiver 
process to minimize time and paperwork burdens on DOE and recipients. 
In addition, DOE is considering issuance of class waivers of broader 
scope than previously granted. It should be noted that using the case-
by-case patent waiver process may allow a recipient to obtain greater 
rights, e.g., rights to subcontractor inventions, than would normally 
be available under the Patent Rights (Small Business Firms and 
Nonprofit Organization) clause.
    Comment: Paragraph (c)(3) of proposed section 600.325 states that 
background patent and data provisions will not normally be required. 
Background patent and data provisions should be included only in 
circumstances where there is an extraordinary risk that the intended 
technological advance would not be commercialized, and only upon mutual 
agreement between recipient and the Contracting Officer.
    Response: Proposed section 600.325, paragraph (c)(3) and the 
preamble of the proposed regulation stated that background rights to 
assure commercialization may be included, but only under special 
circumstances, for example, to provide heightened assurance of 
commercialization. It is expected that these ``special circumstances'' 
will be rare. Paragraph (c)(3) has been modified to expressly state 
that inclusion of background invention (and data) provisions to assure 
commercialization will be done only with the written concurrence of the 
DOE program official setting forth the need for heightened assurance of 
commercialization, and that the scope of any such background licensing 
provisions is subject to negotiation.
    Comment: Paragraph (g) of proposed section 600.325 would make the 
inclusion of the ``Authorization and Consent'' clause an exception 
available only under fairly narrow circumstances. Inclusion of the 
``Authorization and Consent'' clause should be reconsidered. The 
Contracting Officer should have increased flexibility to include the 
clause, or at the very least, the rule should be more specific 
regarding factors to be considered for inclusion of the ``Authorization 
and Consent'' clause (and the ancillary clauses such as ``Notice and 
Assistance'').
    Response: The proposed rule stated that work performed by the 
recipient was not subject to authorization and consent to the use of a 
patented invention except in certain limited circumstances, such as a 
cooperative agreement for research related to homeland security or the 
clean up of a DOE facility. The intent was that DOE would assume no 
liability for patent infringement except in those special circumstances 
where DOE was a secondary beneficiary and could derive some use or 
benefit from the project. DOE generally awards cooperative agreements 
for such projects because DOE's substantial involvement in and 
contribution to the technical aspects of the effort are necessary to 
accomplish the objectives. The proposed rule invited the public to 
comment on whether an authorization and consent provision should be 
included routinely in assistance awards. As a result of our 
consideration of this comment, we have decided to be more specific 
regarding the use of this clause. The final rule includes a revised 
paragraph (g) to specify that the ``Authorization and Consent'' clause 
will not be included in grants, but will be included in all 
cooperative-agreements. DOE decided to include the ``Authorization and 
Consent'' clause in cooperative agreements because these awards are 
virtually always cost-shared, and inclusion of this clause serves as a 
necessary incentive to secure participant cost-sharing. A new 
parargraph (g)(3) has been added to this section. This paragraph 
establishes the policy and clauses for inclusion of ``ancillary'' 
matters such as patent indemnity and notice and assistance. These 
clauses, if included, must be consistent with those in 48 CFR part 927 
for acquisition.
    Comment: The ``Rights in Data--General'' clause in Appendix A to 
subpart D continues to give to the Government unlimited rights in 
``data first produced in the performance of the agreement''. Further, 
paragraph (i), ``Additional data requirements'', of this clause exposes 
the recipient to a disclosure requirement for any data ``first produced 
or specifically used in the performance of the agreement''. DOE should 
have the right to receive only that data that the agreement specifies 
as the deliverable data, so that incidental developments such as basic 
proprietary process improvements, the development of which was not a 
requirement under the agreement, are not at risk.
    Response: Both acquisitions, under the Federal Acquisition 
Regulation (FAR) and the Department of Energy Acquisition Regulation 
(DEAR), and financial assistance, under 10 CFR part 600, give DOE 
rights in data ``first produced'' under an award, e.g., 10 CFR 600.136 
gives DOE the right to ``obtain, reproduce, publish or otherwise use ` 
the data first produced' under an award to an educational and other 
nonprofit organization''. In addition DOE has statutory technical data 
dissemination obligations (e.g., 42 U.S.C. 205(d); 42 U.S.C. 5817(e)). 
Data that is ``specifically used,'' but not first produced in 
performance of an agreement, may be protected by the recipient's 
invoking of the withholding or marking provisions of paragraph (g) 
``Protection of limited rights data and restricted computer software'' 
of the Rights in Data--General clause. Any delivery to the Government 
of limited rights data or restricted computer software is subject to 
negotiation. The fact that the Government has unlimited rights to data 
first produced or specifically used, which does not qualify as limited 
or restricted, does not mean that all data must be delivered. The 
amount of data to be delivered is determined by the program official 
and is subject to negotiation.

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    Comment: The requirement in 10 CFR part 784 for substantial 
manufacture in the United States for a patent title waiver remains 
unchanged. DOE should consider loosening this restriction, since most 
large for-profit corporations today are global and have partnerships 
with many overseas suppliers.
    Response: The requirement for substantial manufacture in the United 
States for assignees and exclusive licensees of a waived invention is 
embodied in a ``Preference for U.S. Industry'' clause implementing a 
statutory requirement applicable to funding agreements with small 
business and nonprofits (35 U.S.C. 204) and made applicable to for-
profit large businesses by the FAR and DOE Patent Waiver regulations, 
10 CFR part 784. That ``preference for U.S. Industry'' provision 
includes authority for a waiver, under certain circumstances. In 
addition, DOE generally requires a ``U.S. Competitiveness'' provision 
as an additional condition for a patent waiver. This ``U.S. 
Competitiveness'' provision is negotiable, depending on circumstances 
surrounding the particular technology involved and DOE programmatic 
concerns. Inclusion of the ``U.S. Competitiveness'' provision is a 
programmatic decision, and therefore may be deleted with the 
concurrence of the DOE program official. However, where 
commercialization of DOE supported technology is the goal, promoting a 
U.S. economic benefit is an essential consideration.

III. Revisions Incorporated in This Final Rule

    In addition to the changes made in response to public comments, DOE 
made the following revisions:
    1. In the proposed rule, section 600.311 encouraged recipients to 
use existing financial management systems established for doing 
business in the commercial marketplace to the extent that the systems 
comply with Generally Accepted Accounting Principles (GAAP) and the 
minimum standards in this section. In the final rule, we have deleted 
the words ``established for doing business in the commercial 
marketplace.'' Recipients are encouraged to use any existing systems 
(i.e., systems used in the commercial marketplace or systems 
established for other government business) as long as the systems 
comply with GAAP and the standards in this section.
    2. In the proposed rule, section 600.316 would require recipients 
that expend $500,000 or more in a year under Federal awards to have an 
audit made for that year by an independent auditor. We have added 
language to paragraph (a) of that section to clarify that if a 
recipient is performing under another Federal award that requires an 
audit by its Federal cognizant agency (e.g., Defense Contract Audit 
Agency), the recipient must also use that agency to conduct the audit 
of the DOE award. The recipient and its Federal cognizant agency should 
develop a coordinated audit approach to ensure that the DOE award is 
included in the recipient's annual Federal audit.
    3. In the proposed rule, section 600.325, paragraph (b) is 
entitled, ``Patent rights--small business concerns and nonprofit 
organizations.'' As this paragraph is within subpart D, which applies 
to for-profit organizations, the title may be misleading or confusing. 
The final rule deletes the references to nonprofit organizations in the 
title and first sentence of paragraph (b), but retains the reference in 
the title of the clause in Appendix A, because this clause implements 
the Bayh-Dole Act (35 U.S.C. 206) and will be used by both small 
businesses and nonprofit organizations.
    4. In section 600.325, paragraph (c)(1) the words ``a large 
business'' have been changed to ``a for-profit organization other than 
a small business concern, as defined in 35 U.S.C. 201(h)'' to comfort 
with the language in the statute. In addition, the words ``pursuant to 
statute'' have been added to clarify that this is a statutory 
requirements.
    5. In the proposed rule, appendix A to subpart D, ``Patent Rights 
(Small Business Firms and Nonprofit Organizations)'' clause, paragraph 
(g)(2) made a reference to, but did not identify, the ``DOE 
implementing regulations'' and did not clearly address subcontracting 
requirements and rights. The final rule clarifies paragraph (g)(2) by 
deleting the reference to ``DOE implementing regulations'' and 
inserting ``10 CFR 600.355(c).'' In addition, a new paragraph (g)(3) 
has been added to this clause to establish requirements for subawards, 
as follows: ``(3) In the case of subawards/contracts at any tier, DOE, 
the Recipient, and the subrecipeint/contractor agree that the mutual 
obligations of the parties created by this clause constitute a contract 
between the subrecipient/contractor and DOE with respect to those 
matters covered by the clause.''
    6. In appendix A to subpart D, ``Rights in Data--Programs Covered 
Under Special Protected Data Statutes'' clause, paragraph (g)(1) has 
been modified to add the following phrase to the end of the first 
sentence: ``that would have been treated as a trade secret if developed 
at private expense.'' This change was made because the Energy Policy 
Act of 1992 limits such protection to data that would have been treated 
as trade secret if developed at private expense (42 U.S.C. 13293).
    7. In the proposed rule, section 600.351(a)(4) allowed DOE to 
terminate a cooperative agreement for convenience of the government. 
While the Federal Acquisition Regulation includes a termination for 
convenience requirement, this is not a standard requirement in 
financial assistance. Neither OMB Circular A-110 nor A-102 includes a 
termination for convenience requirement. After further consideration, 
we have decided to delete paragraph (a)(4) in section 600.351 because 
DOE cooperative agreements are virtually always cost-shared, and 
applicants, lenders, and equity contributors may be reluctant to 
finance these projects if the award includes such a provision. We do 
not want to unnecessarily reduce the number of applicants applying for 
DOE assistance programs.
    8. Minor editorial corrections were made to sections 600.302, 
600.304, and 600.325.

IV. Procedural Requirements

A. Review Under Executive Order 12866

    Today's regulatory action has been determined not to be ``a 
significant regulatory action'' under Executive Order 12866, 
``Regulatory Planning and Review,'' 58 FR 51735 (October 4, 1993). 
Accordingly, this action is not subject to review under that Executive 
Order by the Office of Information and Regulatory Affairs of the Office 
of Management and Budget (OMB).

B. Review Under the Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
preparation of an initial regulatory flexibility analysis for any rule 
that by law must be proposed for public comment, unless the agency 
certifies that the rule, if promulgated, will not have a significant 
economic impact on a substantial number of small entities. Because DOE 
is not required by the Administrative procedure Act (5 U.S.C. 553) or 
any other law to propose financial assistance rules for public comment, 
DOE did not prepare a regulatory flexibility analysis for this rule.

C. Review Under the Paperwork Reduction Act

    This regulatory action will not impose any new reporting or record 
keeping requirements under the Paperwork Reduction Act. Reporting and 
record keeping requirements in subpart D have

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been previously cleared under Office of Management and Budget Paperwork 
Clearance Package Numbers 1910-0400 and 1910-0800 or are those 
promulgated by OMB Circular A-110, which the Office of Management and 
Budget proposed in August 1992 (57 FR 39018), asking for public 
comments, and finalized in November 1993 (58 FR 62992). No new 
collection of information is imposed by this final rule.

D. Review Under the National Environmental Policy Act

    DOE has concluded that promulgation of this rule falls into a class 
of actions that would not individually or cumulatively have a 
significant impact on the human environment, as determined by DOE's 
regulations implementing the National Environmental Policy Act of 1969 
(42 U.S.C. 4321 et seq.). Specifically, this rule deals only with 
agency procedures, and, therefore, is covered under the Categorical 
Exclusion in paragraph A6 to subpart D, 10 CFR part 1021. Accordingly, 
neither an environmental assessment nor an environmental impact 
statement is required.

E. Review Under Executive Order 13132

    Executive Order 13132 (64 FR 43255, August 4, 1999) imposes certain 
requirements on agencies formulating and implementing policies are 
regulations that preempt State law or that have federalism 
implications. Agencies are required to examine the constitutional and 
statutory authority supporting any action that would limit the 
policymaking discretion of the States and carefully assess the 
necessity for such actions. DOE has examined today's final rule and has 
determined that it does not preempt State law and does not have a 
substantial direct effect on the States, on the relationship between 
the national government and the States, or on the distribution of power 
and responsibilities among the various levels of government. No further 
action is required by Execution Order 13132.

F. Review Under Executive Order 12988

    With respect to the review of existing regulations and the 
promulgation of new regulations, section 3(a) of Executive Order 12988, 
``Civil Justice Reform,'' 61 FR 4729 (February 7, 1996), imposes on 
Federal agencies the general duty to adhere to the following 
requirements: (1) Eliminate drafting errors and ambiguity; (2) write 
regulations to minimize litigation; and (3) provide a clear legal 
standard for affected conduct rather than a general standard and 
promote simplification and burden reduction. Section 3(b) of Executive 
Order 12988 specifically requires that Executive agencies make every 
reasonable effort to ensure that the regulations: (1) Clearly specifies 
the preemptive effect, if any; (2) clearly specifies any effect on 
existing Federal law or regulations; (3) provides a clear legal 
standard for affected conduct while promoting simplification and burden 
reduction; (4) specifies the retroactive effect, if any; (5) adequately 
defines key terms; and (6) addresses other important issues affecting 
clarity and general draftsmanship under any guidelines issued by the 
Attorney General, Section 3(c) of Executive Order 12988 requires 
Executive agencies to review regulations in light of applicable 
standards in section 3(a) and section 3(b) to determine whether they 
are met or it is unreasonable to meet one or more of them. DOE has 
completed the required review and determined that, to the extent 
permitted by law, this final rule meets the relevant standards of 
Executive Order 12988.

G. Review Under the Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4) requires each Federal agency to assess the effects of a Federal 
regulatory action on State, local, and tribal governments, and the 
private sector. The Department has determined that today's regulatory 
action does not impose a Federal mandate on State, local or tribal 
governments or on the private sector.

H. Review Under the Treasury and General Government Appropriations Act, 
1999

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family 
Policymaking Assessment for any proposed rule or policy that may affect 
family well-being. Today's rule would not have any impact on the 
autonomy or integrity of the family as an institution. Accordingly, DOE 
has concluded that it is not necessary to prepare a Family Policymaking 
Assessment.

I. Review Under the Treasury and General Government Appropriations Act, 
2001

    The Treasury and General Government Appropriations Act, 2001, 44 
U.S.C. 3516, note, provides for agencies to review most disseminations 
of information to the public under implementing guidelines established 
by each agency pursuant to general guidelines issued by OMB. OMB's 
guidelines were published at 67 FR 8452 (February 22, 2002), and DOE's 
guidelines were published at 67 FR 62446 (October 7, 2002). DOE has 
reviewed today's notice of final rulemaking under the OMB and DOE 
guidelines and has concluded that it is consistent with applicable 
policies in those guidelines.

J. Review Under Executive Order 13211

    Executive Order 13211, Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use, (66 FR 28355, 
May 22, 2001) requires Federal agencies to prepare and submit to the 
Office of Information and Regulatory Affairs (OIRA), Office of 
Management and Budget, a Statement of Energy Effects for any proposed 
significant energy action. A ``significant energy action'' is defined 
as any action by an agency that promulgated or is expected to lead to 
promulgation of a final rule, and that: (1) Is a significant regulatory 
action under Executive Order 12866, or any successor order; and (2) is 
likely to have a significant adverse effect on the supply, 
distribution, or use of energy, or (3) is designated by the 
Administrator of OIRA as a significant energy action. For any proposed 
significant energy action, the agency must give a detailed statement of 
any adverse effects on energy supply, distribution, or use should the 
proposal be implemented, and of reasonable alternatives to the action 
and their expected benefits on energy supply, distribution, and use. 
Today's regulatory action is not a significant energy action. 
Accordingly, DOE has not prepared a Statement of Energy Effects.

K. Review Under the Small Business Regulatory Enforcement Fairness Act

    As required by 5 U.S.C. 801, DOE will report to Congress on the 
promulgation of today's rule prior to its effective date. The report 
will state that it has been determined that the rule is not a ``major 
rule'' as defined by 5 U.S.C. 801(2).

V. Approval of the Office of the Secretary of Energy

    The Office of the Secretary has approved the issuance of this rule.

[[Page 50650]]

List of Subjects in 10 CFR Part 600

    Administrative practice and procedure.

Richard H. Hopf,
Director, Office of Procurement and Assistance Management/Office of 
Management, Budget and Evaluation, Department of Energy.
Robert C. Braden,
Director, Office of Procurement and Assistance Management, National 
Nuclear Security Administration.

0
Part 600 of chapter II, title 10 of the Code of Federal Regulations, is 
amended as follows:

PART 600--FINANCIAL ASSISTANCE RULES

0
1. The authority citation for part 600 continues to read as follows:

    Authority: 42 U.S.C. 7101 et seq; 31 U.S.C. 6301-6308; 50 U.S.C. 
2401 et seq. unless otherwise noted.

0
2. Section 600.3 is amended by revising the definition of ``nonprofit 
organization'' to read as follows:


Sec.  600.3  Definitions.

* * * * *
    Nonprofit organization means any corporation, trust, foundation, or 
institution which is entitled to exemption under section 501(c)(3) of 
the Internal Revenue Code, or which is not organized for profit and no 
part of the net earnings of which inure to the benefit of any private 
shareholder or individual (except that the definition of ``nonprofit 
organization'' at 48 CFR 27.301 shall apply for patent matters set 
forth at Sec. Sec.  600.136 and 600.325).
* * * * *


Sec.  600.4  [Amended]

0
3. Section 600.4 is amended as follows:
0
a. Paragraph (a)(1), the last sentence is amended by removing ``or the 
patent requirements of Sec.  600.27.''
0
b. Paragraph (c)(2)(i), the last sentence is removed.
0
c. Paragraph (c)(2)(ii), the last sentence is removed.


Sec.  600.15  [Amended]

0
4. Section 600.15 is amended by removing paragraphs (b)(4) and (5).


Sec.  600.27  [Removed and Reserved]

0
5. Section 600.27 is removed and reserved.

0
6. The title of subpart B is revised to read as follows:

Subpart B--Uniform Administrative Requirements for Grants and 
Cooperative Agreements With Institutions of Higher Education, 
Hospitals, and Other Nonprofit Organizations


Sec.  600.100  [Amended]

0
7. Section 600.100 is amended by removing ``and commercial'' in the 
first and second sentences.


Sec.  600.104  [Amended]

0
8. Section 600.104 is amended by removing ``or commercial'' in the 
first sentence and by adding a sentence at the end of the paragraph to 
read as follows:


Sec.  600.104  Subawards.

    * * * For-profit subrecipients are subject to the provisions of 10 
CFR part 600, subpart D, Administrative Requirements for Grants and 
Cooperative Agreements with For-Profit Organizations.

0
9. Section 600.126 is amended by removing paragraphs (d) and (e) and 
revising paragraph (c) to read as follows:


Sec.  600.126  Non-Federal audits.

* * * * *
    (c) For-profit organizations that are subrecipients are subject to 
the audit requirements specified in 10 CFR 600.316.


Sec.  600.127  [Amended]

0
10. Section 600.127 is amended in paragraph (c) by removing ``except 
for SBIR recipients as provided in Sec.  600.18(d)(3).''

0
11. Section 600.136 is amended as follows:
0
a. Paragraph (a), the first sentence is amended by removing ``that are 
institutions of higher education, hospitals, and other nonprofit 
organizations,''
0
b. Paragraph (b) is revised.
0
c. Paragraph (d)(3) is removed.
0
d. Paragraph (e), the first sentence is amended by removing ``For 
recipients that are institutions of higher education, hospitals, and 
other nonprofit organizations.''
0
The revision reads as follows:


Sec.  600.136  Intangible property.

* * * * *
    (b) Recipients are subject to applicable regulations governing 
patents and inventions, including government-wide regulations issued by 
the Department of Commerce at 37 CFR part 401, ``Rights to Inventions 
Made by Nonprofit Organizations and Small Business Firms Under 
Government Grants, Contracts and Cooperative Agreements.''
* * * * *


Sec. Sec.  600.180-600.181  [Removed and Reserved]

0
12. Sections 600.180 and 600.181 are removed.
0
13. Subpart D is added in part 600 to read as follows:

Subpart D--Uniform Administrative Requirements for Grants and 
Cooperative Agreemenets With For-Profit Organizations

General

Sec.
600.301 Purpose.
600.302 Definitions.
600.303 Deviations.
600.304 Special award conditions.
600.305 Debarment and suspension.
600.306 Metric system of measurement.

Post-Award Requirements

Financial and Program Management

600.310 Purpose of financial and program management.
600.311 Standards for financial management systems.
600.312 Payment.
600.313 Cost sharing or matching.
600.314 Program income.
600.315 Revision of budget and program plans.
600.316 Audits.
600.317 Allowable costs.
600.318 Fee and profit.

Property Standards

600.320 Purpose of property standards.
600.321 Real property and equipment.
600.322 Federally owned property.
600.323 Property management system.
600.324 Supplies.
600.325 Intellectual property.

Procurement Standards

600.330 Purpose of procurement standards.
600.331 Requirements.

Reports and Records

600.340 Purpose of reports and records.
600.341 Monitoring and reporting program and financial performance.
600.342 Retention and access requirements for records.

Termination and Enforcement

600.350 Purpose of termination and enforcement.
600.351 Termination.
600.352 Enforcement.
600.353 Disputes and appeals.

After-the-Award Requirements

600.360 Purpose.
600.361 Closeout procedures.
600.362 Subsequent adjustments and continuing responsibilities.
600.363 Collection of amounts due.

Additional Provisions

600.380 Purpose.

[[Page 50651]]

600.381 Special provisions for Small Business Innovation Research 
Grants.
Appendix A to Subpart D to Part 600--Patent and Data Rights 
Provisions
Appendix B to Subpart D to Part 600--Contract Provisions

Subpart D--Administrative Requirements for Grants and Cooperative 
Agreements With For-Profit Organizations

General


Sec.  600.301  Purpose.

    (a) This subpart prescribes administrative requirements for awards 
to for-profit organizations.
    (b) Applicability to prime awards and subawards is as follows:
    (1) Prime awards: DOE contracting officers must apply the 
provisions of this part to awards to for-profit organizations. 
Contracting officers must not impose requirements that are in addition 
to, or inconsistent with, the requirements provided in this part, 
except:
    (i) In accordance with the deviation procedures or special award 
conditions in Sec.  600.303 or Sec.  600.304, respectively; or
    (ii) As required by Federal statute, Executive order, or Federal 
regulation implementing a statute or Executive order.
    (2) Subawards. (i) Any legal entity (including any State, local 
government, university or other nonprofit organization, as well as any 
for-profit entity) that receives an award from DOE must apply the 
provisions of this part to subawards with for-profit organizations.
    (ii) For-profit organizations that receive prime awards covered by 
this part must apply to each subaward the administrative requirements 
that are applicable to the particular type of subrecipient (e.g., 10 
CFR part 600, subpart B, contains requirements for institutions of 
higher education, hospitals, or other nonprofit organizations and 10 
CFR part 600, subpart C, specifies requirements for subrecipients that 
are States or local governments).


Sec.  600.302  Definitions.

    In addition to the definitions used in subpart A of this part, the 
following are definitions of terms as used in this subpart:
    Advance means a payment made by Treasury check or other appropriate 
payment mechanism to a recipient upon its request either before outlays 
are made by the recipient or through the use of predetermined payment 
schedules.
    Applied research means efforts that seek to determine and exploit 
the potential of scientific discoveries or improvements in technology, 
and is directed toward the development of new materials, devices, 
methods, and processes.
    Basic research means efforts directed solely toward increasing 
knowledge or understanding in science and engineering.
    Cash contributions means the recipient's cash outlay, including the 
outlay of money contributed to the recipient by third parties.
    Closeout means the process by which DOE determines that all 
applicable administrative actions and all required work of the award 
have been completed by the recipient and DOE.
    Cost sharing or matching means that portion of project or program 
costs not borne by the Federal Government.
    Demonstration means a project designed to determine the technical 
feasibility and economic potential of a technology on either a pilot 
plant or a prototype scale.
    Development means efforts to create or advance new technology or 
demonstrate the viability of applying existing technology to new 
products and processes.
    Disallowed costs means those charges to an award that the DOE 
contracting officer determines to be unallowable, in accordance with 
the applicable Federal cost principles or other terms and conditions 
contained in the award.
    DOE means the Department of Energy, including the National Nuclear 
Security Administration (NNSA).
    Equipment means tangible, nonexpendable personal property charged 
directly to the award having a useful life of more than one year and an 
acquisition cost of $5,000 or more per unit.
    Excess property means property under the control of any DOE 
Headquarters or field office that, as determined by the head thereof, 
is no longer required for its needs or the discharge of its 
responsibilities.
    Federal funds authorized: means the total amount of Federal funds 
obligated by the Federal Government for use by the recipient. This 
amount may include any authorized carryover of unobligated funds from 
prior funding periods.
    Federally owned property means property in the possession of, or 
directly acquired by, the Government and subsequently made available to 
the recipient.
    Funding period means the period of time when Federal funding is 
available for obligation by the recipient.
    Incremental funding means a method of funding a grant or 
cooperative agreement where the funds initially obligated to the award 
are less than the total amount of the award, and DOE anticipates making 
additional obligations of funds when appropriated funds become 
available.
    Obligations means the amount of orders placed, contracts and grants 
awarded, services received and similar transactions during a given 
period that require payment by the recipient during the same or a 
future period.
    Outlays or expenditures means charges made to the project or 
program. They may be reported on cash or accrual basis. For reports 
prepared on a cash basis, outlays are the sum of cash disbursements for 
direct charges for goods and services, the amount of indirect expense 
charged, the value of third party in-kind contributions applied, and 
the amount of cash advances and payments made to subrecipients. For 
reports prepared on an accrual basis, outlays are the sum of cash 
disbursements for direct charges for goods and services, the amount of 
indirect expense incurred, the value of in-kind contributions applied, 
and the net increase (or decrease) in the amounts owed by the recipient 
for goods and other property received, for services performed by 
employees, contractors, subrecipients and other payees, and for other 
amounts becoming owed under programs for which no current services or 
performance are required.
    Personal property means property of any kind except real property. 
It may be:
    (1) Tangible, having physical existence (i.e., equipment and 
supplies); or
    (2) Intangible, having no physical existence, such as patents, 
copyrights, data, and software.
    Prior approval means written or electronic approval by an 
authorized official evidencing prior consent.
    Program income means gross income earned by the recipient that is 
directly generated by a supported activity or earned as a result of the 
award. Program income includes, but is not limited to, income from fees 
for services performed, the use or rental of real or personal property 
acquired under federally-funded projects, the sale of commodities or 
items fabricated under an award, license fees and royalties on patents 
and copyrights, and interest on loans made with award funds. Interest 
earned on advances of Federal funds is not program income. Except as 
otherwise provided in program regulations or the terms and conditions 
of the award, program income does not include the receipt of principal 
on loans, rebates, credits, discounts, etc., or interest earned on any 
of them.

[[Page 50652]]

    Project costs means all allowable costs, as set forth in the 
applicable Federal cost principles, incurred by a recipient and the 
value of the contributions made by third parties in accomplishing the 
objectives of the award during the project period.
    Property means real property and personal property (equipment, 
supplies, and intellectual property), unless otherwise stated.
    Real property means land, including land improvements, structures 
and appurtenances thereto, but excludes movable machinery and 
equipment.
    Small award means an award not exceeding the simplified acquisition 
threshold fixed at 41 U.S.C. 403(11) (currently $100,000).
    Small business concern means a small business as defined at section 
2 of Pub. L. 85-536 (16 U.S.C. 632) and the implementing regulations of 
the Administrator of the Small Business Administration. The criteria 
and size standards for small business concerns are contained in 13 CFR 
part 121.
    Subaward means financial assistance in the form of money, or 
property in lieu of money, provided under an award by a recipient to an 
eligible subrecipient or by a subrecipient to a lower tier 
subrecipient. The term includes financial assistance when provided by 
an legal agreement, even if the agreement is called a contract, but the 
term does not include procurement of goods and services or any form of 
assistance which is not included in the definition of ``award'' in this 
part.
    Subrecipient means the legal entity to which a subaward is made and 
which is accountable to the recipient for the use of the funds or 
property provided.
    Supplies means tangible, expendable personal property that is 
charged directly to the award and that has a useful life of less than 
one year or an acquisition cost of less than $5,000 per unit.
    Suspension means an action by DOE that temporarily withdraws 
Federal sponsorship under an award, pending corrective action by the 
recipient or pending a decision to terminate the award by DOE. 
Suspension of an award is a separate action from suspension of a 
recipient under 10 CFR part 1036.
    Termination means the cancellation of an award, in whole or in 
part, under an agreement at any time prior to either:
    (1) The date on which all work under an award is completed; or
    (2) The date on which Federal sponsorship ends, as provided in the 
award document or any supplement or amendment thereto.
    Third party in-kind contributions means the value of non-cash 
contributions provided by non-Federal third parties. Third party in-
kind contributions may be in the form of real property, equipment, 
supplies and other expendable property, and the value of goods and 
services directly benefiting and specifically identifiable to the 
project or program.
    Unobligated balance means the portion of the funds authorized by 
DOE that has not been obligated by the recipient and is determined by 
deducting the cumulative obligations from the cumulative funds 
authorized.


Sec.  600.303  Deviations.

    (a) Individual deviations. Individual deviations affecting only one 
award are subject to the procedures stated in 10 CFR 600.4
    (b) Class deviations. Class deviations affecting more than one 
financial assistance transaction are subject to the procedures states 
in 10 CFR 600.4.


Sec.  600.304  Special award conditions.

    (a) Contracting officers may impose additional requirements as 
needed, over and above those provided in this subpart, if an applicant 
or recipient:
    (1) Has a history of poor performance;
    (2) Is not financially stable;
    (3) Has a management system that does not meet the standards 
prescribed in this subpart;
    (4) Has not conformed to the terms and conditions of a previous 
award; or
    (5) Is not otherwise responsible.
    (b) Before imposing additional requirements, DOE must notify the 
applicant or recipient in writing as to:
    (1) The nature of the additional requirements;
    (2) The reason why the additional requirements are being imposed;
    (3) The nature of the corrective action needed;
    (4) The time allowed for completing the corrective actions; and
    (5) The method for requesting reconsideration of the additional 
requirements imposed.
    (c) The contracting officer must remove any special conditions if 
the circumstances that prompted them have been corrected.


Sec.  600.305  Debarment and suspension.

    Recipients must comply with the nonprocurement debarment and 
suspension common rule implemented in 10 CFR part 1036. This common 
rule restricts subawards and contracts with certain parties that are 
debarred, suspended, or otherwise excluded from or ineligible for 
participation in Federal assistance programs or activities.


Sec.  600.306  Metric system of measurement.

    (a) The Metric Conversion Act of 1975, as amended by the Omnibus 
Trade and Competitiveness Act of 1988 (15 U.S.C. 205) and implemented 
by Executive Order 12770, states that:
    (1) The metric system is the preferred measurement system for U.S. 
trade and commerce.
    (2) The metric system of measurement will be used, to the extent 
economically feasible, in Federal agencies' procurements, grants, and 
other business-related activities.
    (3) Metric implementation is not required if such use is likely to 
cause significant inefficiencies or loss of markets to United States 
firms.
    (b) Recipients are encouraged to use the metric system to the 
maximum extent practicable in measurement-sensitive activities and in 
measurement-sensitive outputs resulting from DOE funded programs.

Post-Award Requirements

Financial and Program Management


Sec.  600.310  Purpose of financial and program management.

    Sections 600.311 through 600.318 prescribe standards for financial 
management systems; methods for making payments; and rules for cost 
sharing and matching, program income, revisions to budgets and program 
plans, audits, allowable costs, and fee and profit.


Sec.  600.311  Standards for financial management systems.

    (a) Recipients are encouraged to use existing financial management 
systems to the extent that the systems comply with Generally Accepted 
Accounting Principles (GAAP) and the minimum standards in this section. 
At a minimum, a recipient's financial management system must provide:
    (1) Effective control of all funds. Control systems must be 
adequate to ensure that costs charged to Federal funds and those 
counted as the recipient's cost share or match are consistent with 
requirements for cost reasonableness, allowability, and allocability in 
the applicable cost principles (see Sec.  600.317) and in the terms and 
conditions of the award.
    (2) Accurate, current and complete records that document, for each 
project funded wholly or in part with Federal funds, the source and 
application of the Federal funds and the recipient's required cost 
share or match. These records must:
    (i) Contain information about receipts, authorizations, assets, 
expenditures, program income, and interest.

[[Page 50653]]

    (ii) Be adequate to make comparisons of outlays with amounts 
budgeted for each award (as required for programmatic and financial 
reporting under Sec.  600.341). Where appropriate, financial 
information should be related to performance and unit cost data.
    (3) To the extent that advance payments are authorized under Sec.  
600.312, procedures that minimize the time elapsing between the 
transfer of funds to the recipient from the Government and the 
recipient's disbursement of the funds for program purposes.
    (4) A system to support charges to Federal awards for salaries and 
wages, whether treated as direct or indirect costs. If employees work 
on multiple activities or cost objectives, a distribution of their 
salaries and wages must be supported by personnel activity reports 
which:
    (i) Reflect an after the fact distribution of the actual activity 
of each employee.
    (ii) Account for the total activity for which each employee is 
compensated.
    (iii) Are prepared at least monthly, and coincide with one or more 
pay periods.
    (b) If the Federal Government guarantees or insures the repayment 
of money borrowed by the recipient, DOE, at its discretion, may require 
adequate bonding and insurance if the bonding and insurance 
requirements of the recipient are not deemed adequate to protect the 
interest of the Federal Government.
    (c) DOE may require adequate fidelity bond coverage if the 
recipient lacks sufficient coverage to protect the Federal Government's 
interest.
    (d) If bonds are required in the situations described in paragraphs 
(b) and (c) of this section, the bonds must be obtained from companies 
holding certificates of authority as acceptable sureties, as prescribed 
in 31 CFR part 223, ``Surety Companies Doing Business with the United 
States.''


Sec.  600.312  Payment.

    (a) Methods available. Payment methods for awards with for-profit 
organizations are:
    (1) Reimbursement. Under this method, the recipient requests 
reimbursement for costs incurred during a particular time period. In 
cases where the recipient submits requests for payment to the 
contracting officer, the DOE payment office reimburses the recipient by 
electronic funds transfer after approval of the request by the 
designated contracting officer.
    (2) Advance payments. Under this method, DOE makes a payment to a 
recipient based upon projections of the recipient's cash needs. The 
payment generally is made upon the recipient's request, although 
predetermined payment schedules may be used when the timing of the 
recipient's needs to disburse funds can be predicted in advance with 
sufficient accuracy to ensure compliance with paragraph (b)(2)(iii) of 
this section.
    (b) Selecting a method. (1) The preferred payment method is the 
reimbursement method, as described in paragraph (a)(1) of this section.
    (2) Advance payments, as described in paragraph (a)(2) of this 
section, may be used in exceptional circumstances, subject to the 
following conditions:
    (i) The contracting officer, in consultation with the program 
official, determines in writing that advance payments are necessary or 
will materially contribute to the probability of success of the project 
contemplated under the award (e.g., as startup funds for a project 
performed by a newly formed company).
    (ii) Cash advances must be limited to the minimum amounts needed to 
carry out the program.
    (iii) Recipients and DOE must maintain procedures to ensure that 
the timing of cash advances is as close as is administratively feasible 
to the recipients' disbursements of the funds for program purposes, 
including direct program or project costs and the proportionate share 
of any allowable indirect costs.
    (iv) Recipients must maintain advance payments of Federal funds in 
interest-bearing accounts, and remit annually the interest earned to 
the contracting officer for return to the Department of Treasury's 
miscellaneous receipts account, unless one of the following applies:
    (A) The recipient receives less than $120,000 in Federal awards per 
year.
    (B) The best reasonably available interest bearing account would 
not be expected to earn interest in excess of $250 per year on Federal 
cash balances.
    (C) The depository would require an average or minimum balance so 
high that establishing an interest bearing account would not be 
feasible, given the expected Federal and non-Federal cash resources.
    (c) Frequency of payments. For either reimbursements or advance 
payments, recipients may submit requests for payment monthly, or more 
often if authorized by the contracting officer.
    (d) Forms for requesting payment. DOE may authorize recipients to 
use the SF-270, ``Request for Advance or Reimbursement;'' the SF-271, 
``Outlay Report and Request for Reimbursement for Construction 
Programs;'' or prescribe other forms or formats as necessary.
    (e) Timeliness of payments. Payments normally will be made within 
30 calendar days of the receipt of a recipient's request for 
reimbursement or advance by the office designated to receive the 
request, unless the billing is improper.
    (f) Precedence of other available funds. Recipients must disburse 
funds available from program income, rebates, refunds, contract 
settlements, audit recoveries, credits, discounts, and interest earned 
on such funds before requesting additional cash payments.
    (g) Withholding of payments. Unless otherwise required by statute, 
contracting officers may not withhold payments for proper charges made 
by recipients during the project period for reasons other than the 
following:
    (1) A recipient failed to comply with project objectives, the terms 
and conditions of the award, or Federal reporting requirements, in 
which case the contracting officer may suspend payments in accordance 
with Sec.  600.352.
    (2) The recipient is delinquent on a debt to the United States (see 
definitions of ``debt'' and ``delinquent debt'' in 32 CFR 22.105). In 
that case, the contracting officer may, upon reasonable notice, 
withhold payments to the recipient until the debt owed is resolved.


Sec.  600.313  Cost sharing or matching.

    (a) Acceptable contributions. All contributions, including cash 
contributions and third party in-kind contributions, must be accepted 
as part of the recipient's cost sharing or matching if such 
contributions meet all of the following criteria:
    (1) They are verifiable from the recipient's records.
    (2) They are not included as contributions for any other federally-
assisted project or program.
    (3) They are necessary and reasonable for proper and efficient 
accomplishment of project or program objectives.
    (4) They are allowable under Sec.  600.317.
    (5) They are not paid by the Federal Government under another award 
unless authorized by Federal statute to be used for cost sharing or 
matching.
    (6) They are provided for in the approved budget.
    (7) They conform to other provisions of this part, as applicable.
    (b) Valuing and documenting contributions.
    (1) Valuing recipient's property or services of recipient's 
employees. Values are established in accordance with the applicable 
cost principles in Sec.  600.317,

[[Page 50654]]

which means that amounts chargeable to the project are determined on 
the basis of costs incurred. For real property or equipment used on the 
project, the cost principles authorize depreciation or use charges. The 
full value of the item may be applied when the item will be consumed in 
the performance of the award or fully depreciated by the end of the 
award. In cases where the full value of a donated capital asset is to 
be applied as cost sharing or matching, that full value must be the 
lesser or the following:
    (i) The certified value of the remaining life of the property 
recorded in the recipient's accounting records at the time of donation; 
or
    (ii) The current fair market value. If there is sufficient 
justification, the contracting officer may approve the use of the 
current fair market value of the donated property, even if it exceeds 
the certified value at the time of donation to the project. The 
contracting officer may accept the use of any reasonable basis for 
determining the fair market value of the property.
    (2) Valuing services of others' employees. If an employer other 
than the recipient furnishes the services of an employee, those 
services are valued at the employee's regular rate of pay plus an 
amount of fringe benefits and overhead (at an overhead rate appropriate 
for the location where the services are performed), provided these 
services are in the same skill for which the employee is normally paid.
    (3) Valuing volunteer services. Volunteer services furnished by 
professional and technical personnel, consultants, and other skilled 
and unskilled labor may be counted as cost sharing or matching if the 
service is an integral and necessary part of an approved project or 
program. Rates for volunteer services must be consistent with those 
paid for similar work in the recipient's organization. In those markets 
in which the required skills are not found in the recipient 
organization, rates must be consistent with those paid for similar work 
in the labor market in which the recipient competes for the kind of 
services involved. In either case, paid fringe benefits that are 
reasonable, allowable, and allocable may be included in the valuation.
    (4) Valuing property donated by third parties.
    (i) Donated supplies may include such items as office supplies or 
laboratory supplies. Value assessed to donated supplies included in the 
cost sharing or matching share must be reasonable and must not exceed 
the fair market value of the property at the time of the donation.
    (ii) Normally only depreciation or use charges for equipment and 
buildings may be applied. However, the fair rental charges for land and 
the full value of equipment or other capital assets may be allowed, 
when they will be consumed in the performance of the award or fully 
depreciated by the end of the award, provided that the contracting 
officer has approved the charges. When use charges are applied, values 
must be determined in accordance with the usual accounting policies of 
the recipient, with the following qualifications:
    (A) The value of donated space must not exceed the fair rental 
value of comparable space as established by an independent appraisal of 
comparable space and facilities in a privately-owned building in the 
same locality.
    (B) The value of loaned equipment must not exceed its fair rental 
value.
    (5) Documentation. The following requirements pertain to the 
recipient's supporting records for in-kind contributions from third 
parties:
    (i) Volunteer services must be documented and, to the extent 
feasible, supported by the same methods used by the recipient for its 
own employees.
    (ii) The basis for determining the valuation for personal services 
and property must be documented.


Sec.  600.314  Program income.

    (a) DOE must apply the standards in this section to the disposition 
of program income from projects financed in whole or in part with 
Federal funds.
    (b) Unless program regulations or the terms and conditions of the 
award provide otherwise, recipients, without any further accounting to 
DOE, may retain program income earned:
    (1) From license fees and royalties for copyrighted material, 
patents, patent applications, trademarks, and inventions produced under 
an award.
    (2) After the end of the project period.
    (c) Unless program regulations or the terms and conditions of the 
award provide otherwise, costs incident to the generation of program 
income for which there is some obligation to the Government may be 
deducted from gross income to determine program income, provided these 
costs have not been charged to the award.
    (d) Other than any program income excluded pursuant to paragraph 
(b) and (c) of this section, program income earned during the project 
period must be retained by the recipient and used in one or more of the 
following ways, as specified in program regulations or the terms and 
conditions of the award:
    (1) Added to funds committed to the project by DOE and recipient 
and used to further eligible project or program objectives.
    (2) Used to finance the non-Federal share of the project or 
program.
    (3) Deducted from the total project or program allowable cost in 
determining the net allowable costs on which the Federal share of costs 
is based.
    (e) If the program regulation or terms and conditions of an award 
authorize the disposition of program income as described in paragraph 
(d)(1) or (d)(2) of this section, and stipulate a limit on the amounts 
that may be used in those ways, program income in excess of the 
stipulated limits must be used in accordance with paragraph (d)(3) of 
this section.
    (f) In the event that the program regulation or terms and 
conditions of the award do not specify how program income is to be 
used, paragraph (d)(3) of this section applies automatically to all 
projects or programs except research. For awards that support basic or 
applied research, paragraph (d)(1) of this section applies 
automatically unless the terms and conditions specify another 
alternative or the recipient is subject to special award conditions, as 
indicated in Sec.  600.304.
    (g) Proceeds from the sale of property that is acquired, rather 
than fabricated, under an award are not program income and must be 
handled in accordance with the requirements of Sec. Sec.  600.320 
through 600.325 of this part.


Sec.  600.315  Revision of budget and program plans.

    (a) The budget plan is the financial expression of the project or 
program as approved during the award process. It includes the sum of 
the Federal and non-Federal shares when there are cost sharing 
requirements. The budget plan must be related to performance for 
program evaluation purposes, whenever appropriate.
    (b) The recipient must obtain the contracting officer's prior 
approval if a revision is necessary for either of the following two 
reasons:
    (1) A change in the scope or the objective of the project or 
program (even if there is no associated budget revision requiring prior 
written approval).
    (2) A need for additional Federal funding.
    (c) The recipient must obtain the contracting officer's prior 
approval if a revision is necessary for any of the following six 
reasons, unless the requirement for prior approval is specifically 
waived in the program regulation or terms and conditions of the award:
    (1) A change in the approved project director, principal 
investigator, or other

[[Page 50655]]

key person specified in the application or award document.
    (2) The absence for more than three months, or a 25 percent 
reduction in time devoted to the project, by the approved project 
director or principal investigator.
    (3) The inclusion of any additional costs that require prior 
approval in accordance with the applicable costs principles for Federal 
funds and the requirements applicable to the recipient's cost share or 
match, as provided in Sec.  600.313 and Sec.  600.317, respectively.
    (4) The inclusion of pre-award costs for periods greater than the 
90 calendar days immediately preceding the effective date of the award.
    (5) A ``no-cost'' extension of the project period.
    (6) Any subaward, transfer, or contracting out of substantive 
program performance under an award, unless described in the application 
and funded in the approved awards.
    (d) If specifically required in the program regulation or the terms 
and conditions of the award, the recipient must obtain the contracting 
officer's prior approval for the following revisions:
    (1) The transfer of funds among direct cost categories, functions, 
and activities for awards in which the Federal share of the project 
exceeds $100,000 and the cumulative amount of such transfers exceeds or 
is expected to exceed 10 percent of the total budget as last approved 
by DOE.
    (2) For awards that provide support for both construction and 
nonconstruction work, any fund or budget transfers between the two 
types of work supported.
    (e) Within 30 calendar days from the date of receipt of the 
recipient's request for budget revisions, the contracting officer must 
review the request and notify the recipient whether the budget 
revisions have been approved. If the revision is still under 
consideration at the end of 30 calendar days, the contracting officer 
must inform the recipient in writing of the date when the recipient may 
expect the decision.


Sec.  600.316  Audits.

    (a) Any recipient that expends $500,000 or more in a year under 
Federal awards must have an audit made for that year by an independent 
auditor, in accordance with paragraph (b) of this section. If a 
recipient is currently performing under a Federal award that requires 
an audit by its Federal cognizant agency, that auditor must perform the 
independent audit. The audit generally should be made a part of the 
regularly scheduled, annual audit of the recipient's financial 
statements. However, it may be more economical in some cases to have 
Federal awards separately audited, and a recipient may elect to do so, 
unless that option is precluded by award terms and conditions or by 
Federal laws or regulations applicable to the program(s) under which 
the awards were made.
    (b) The auditor must determine and report on whether:
    (1) The recipient has an internal control structure that provides 
reasonable assurance that it is managing Federal awards in compliance 
with Federal laws and regulations and the terms and conditions of the 
awards.
    (2) Based on a sampling of Federal award expenditures, the 
recipient has complied with laws, regulations, and award terms that may 
have a direct and material effect on Federal awards.
    (c) The recipient must make the auditor's report available to the 
DOE contracting officers whose awards are affected.
    (d) Before requesting an audit in addition to the independent 
audit, the contracting officer must:
    (1) Consider whether the independent audit satisfies his or her 
requirements;
    (2) Limit the scope of such additional audit to areas not 
adequately addressed by the independent audit; and
    (3) If DOE is not the Federal agency with the predominant fiscal 
interest in the recipient, coordinate with the agency that has the 
predominant fiscal interest.
    (e) The recipient and its Federal cognizant agency for audit should 
develop a coordinated audit approach to minimize duplication of audit 
work.
    (f) Audit costs (including a reasonable allocation of the costs of 
the audit of the recipient's financial statement, based on the relative 
benefit to the Government and the recipient) are allowable costs of DOE 
awards.


Sec.  600.317  Allowable costs.

    (a) DOE determines allowability of costs in accordance with the 
cost principles applicable to the type of entity incurring the cost as 
follows:
    (1) For-profit organizations. Allowability of costs incurred by 
for-profit organizations and those nonprofit organizations listed in 
Attachment C to OMB Circular A-122 is determined in accordance with the 
for-profit costs principles in 48 CFR part 31 in the Federal 
Acquisition Regulation, except that patent prosecution costs are not 
allowable unless specifically authorized in the award document.
    (2) Other types of organizations. Allowability of costs incurred by 
other types of organizations that may be subrecipients under a prime 
award to a for-profit organization is determined as follows:
    (i) Institutions of higher education. Allowability is determined in 
accordance with OMB Circular A-21, ``Cost Principles for Educational 
Institutions.''
    (ii) Other nonprofit organizations. Allowability is determined in 
accordance with OMB Circular A-122, ``Cost Principles for Nonprofit 
Organizations.''
    (iii) Hospitals. Allowability is determined in accordance with the 
provisions of 45 CFR part 74, Appendix E, ``Principles for Determining 
Costs Applicable to Research and Development Under Grants and Contracts 
with Hospitals.''
    (iv) Governmental organizations. Allowability for State, local, or 
federally recognized Indian tribal government is determined in 
accordance with OMB Circular A-87, ``Cost Principles for State and 
Local Governments.''
    (b) Pre-award costs. If a recipient incurs pre-award costs without 
the prior approval of the contracting officer, DOE may pay those costs 
incurred within the ninety calendar day period immediately preceding 
the effective date of the award, if such costs are:
    (1) Necessary for the effective and economical conduct of the 
project;
    (2) Otherwise allowable in accordance with the applicable cost 
principles; and
    (3) Less than the total value of the award.


Sec.  600.318  Fee and profit.

    (a) Grants and cooperative agreements may not provide for the 
payment of fee or profit to recipients or subrecipients, except for 
awards made pursuant to the Small Business Innovation Research or Small 
Business Technology Transfer Research programs.
    (b) A recipient or subrecipient may pay a fee or profit to a 
contractor providing goods or services under a contract.

Property Standards


Sec.  600.320  Purpose of property standards.

    Sections 600.321 through 600.325 set forth uniform standards for 
management, use, and disposition of property. DOE encourages recipients 
to use existing property-management systems to the extent that the 
systems meet these minimum requirements.


Sec.  600.321  Real property and equipment.

    (a) Prior approvals for acquisition with Federal funds. Recipients 
may purchase real property or equipment in whole or in part with 
Federal funds

[[Page 50656]]

under an award only with the prior approval of the contracting officer.
    (b) Title. Unless a statute specifically authorizes and the award 
specifies that title to property vests unconditionally in the 
recipient, title to real property or equipment vests in the recipient 
subject to the conditions that the recipient:
    (1) Use the real property or equipment for the authorized purposes 
of the project until funding for the project ceases, or until the 
property is no longer needed for the purposes of the project;
    (2) Not encumber the property without approval of the contracting 
officer; and
    (3) Use and dispose of the property in accordance with paragraphs 
(d) and (e) of this section.
    (c) Federal interest in real property or equipment offered as cost-
share. A recipient may offer the full value of real property or 
equipment that is purchased with recipient's funds or that is donated 
by a third party to meet a portion of any required cost sharing or 
matching, subject to the requirements in Sec.  600.313. If a resulting 
award includes such property as a portion of the recipient's cost 
share, the Government has a financial interest in the property, (i.e., 
a share of the property value equal to the Federal participation in the 
project). The property is considered as if it had been acquired in part 
with Federal funds, and is subject to the provisions of paragraphs 
(b)(1), (b)(2), and (b)(3) of this section and to the provisions of 
Sec.  600.323.
    (d) Insurance. Recipients must, at a minimum, provide the 
equivalent insurance coverage for real property and equipment acquired 
with DOE funds as provided to property owned by the recipient.
    (e) Use. If real property or equipment is acquired in whole or in 
part with Federal funds under an award and the award does not specify 
that title vests unconditionally in the recipient, the real property or 
equipment is subject to the following:
    (1) During the time that the real property or equipment is used on 
the project or program for which it was acquired, the recipient must 
make it available for use on other projects or programs, if such other 
use does not interfere with the work on the project or program for 
which the real property or equipment was originally acquired. Use of 
the real property or equipment on other projects is subject to the 
following order of priority:
    (i) Activities sponsored by DOE grants, cooperative agreements, or 
other assistance awards;
    (ii) Activities sponsored by other Federal agencies' grants, 
cooperative agreements, or other assistance awards;
    (iii) Activities under Federal procurement contracts or activities 
not sponsored by any Federal agency. If so used, use charges must be 
assessed to those activities. For real property or equipment, the use 
charges must be at rates equivalent to those for which comparable real 
property or equipment may be leased.
    (2) After Federal funding for the project ceases or if the real 
property or equipment is no longer needed for the purposes of the 
project, the recipient may use the real property or equipment for other 
projects, insofar as:
    (i) There are Federally sponsored projects for which the real 
property or equipment may be used. If the only use for the real 
property or equipment is for projects that have no Federal sponsorship, 
the receipt must proceed with disposition of the real property or 
equipment, in accordance with paragraph (f) of this section.
    (ii) The recipient obtains written approval from the contracting 
officer to do so. The contracting officer must ensure that there is a 
formal change of accountability for the real property or equipment to a 
currently funded, Federal award.
    (iii) The recipient's use of the real property or equipment for 
other projects is in the same order of priority as described in 
paragraph (e)(1) of this section.
    (f) Disposition.
    (1) If an item of real property or equipment is no longer needed 
for Federally sponsored projects, the recipient has the following 
options:
    (i) If the property is equipment with a current per unit fair 
market value of less than $5,000, it may be retained, sold, or 
otherwise disposed of with no further obligation to DOE.
    (ii) If the property that is no longer needed is equipment (rather 
than real property), the recipient may wish to replace it with an item 
that is needed currently for the project by trading in or selling to 
offset the costs of the replacement equipment, subject to the approval 
of the contracting officer.
    (iii) The recipient may elect to retain title, without further 
obligation to the Federal Government, by compensating the Federal 
Government for that percentage of the current fair market value of the 
real property or equipment that is attributable to the Federal 
participation in the project.
    (iv) If the recipient does not elect to retain title to real 
property or equipment or does not request approval to use equipment as 
trade-in or offset for replacement equipment, the recipient must 
request disposition instructions from the responsible agency.
    (2) If a recipient requests disposition instructions, the 
contracting officer must:
    (i) For equipment (but not real property), consult with the DOE 
Project Director to determine whether the condition and nature of the 
equipment warrant excess screening within DOE. If screening is 
warranted, the equipment will be made available for reutilization 
within DOE through the Energy Asset Disposal System (EADS). If no DOE 
requirement is identified within a 30-day period, EADS automatically 
reports the availability of the equipment to the General Services 
Administration, to determine whether a requirement for the equipment 
exists in other Federal agencies.
    (ii) For either real property or equipment, issue instructions to 
the recipient for disposition of the property no later than 120 
calendar days after the recipient's request. The contracting officer's 
options for disposition are to direct the recipient to:
    (A) Transfer title to the real property or equipment to the Federal 
Government or to an eligible third party provided that, in such cases, 
the recipient is entitled to compensation for its attributable 
percentage of the current fair market value of the real property or 
equipment, plus any reasonable shipping or interim storage costs 
incurred.
    (B) Sell the real property or equipment and pay the Federal 
Government for that percentage of the current fair market value of the 
property that is attributable to the Federal participation in the 
project (after deducting actual and reasonable selling and fix-up 
expenses, if any, from the sale proceeds). If the recipient is 
authorized or required to sell the real property or equipment, the 
recipient must use competitive procedures that result in the highest 
practicable return.
    (3) If the responsible agency fails to issue disposition 
instructions within 120 calendar days of the recipient's request, the 
recipient must dispose of the real property or equipment through the 
option described in paragraph (f)(2)(ii)(B) of this section.


Sec.  600.322  Federally owned property.

    (a) Annual inventory. The recipient must submit annually to the 
contracting officer an inventory listing of all Federally owned 
property in its custody, i.e., property furnished by the Federal 
Government, rather than acquired by the recipient with Federal funds 
under the award.

[[Page 50657]]

    (b) Insurance. The recipient may not insure Federally owned 
property unless required by the terms and conditions of the award.
    (c) Use on other activities. (1) Use of federally owned property on 
other activities is permissible, if authorized by the contracting 
officer responsible for administering the award to which the property 
currently is charged.
    (2) Use on other activities must be in the following order of 
priority:
    (i) Activities sponsored by DOE grants, cooperative agreements, or 
other assistance awards;
    (ii) Activities sponsored by other Federal agencies' grants, 
cooperative agreements, or other assistance awards;
    (iii) Activities under Federal procurement contracts or activities 
not sponsored by any Federal agency. If so used, use charges must be 
assessed to those activities. For real property or equipment, the use 
charges must be at rates equivalent to those for which comparable real 
property or equipment may be leased.
    (d) Disposition or property. Upon completion of the award, the 
recipient must submit to the contracting officer a final inventory of 
Federal owned property. DOE may:
    (1) Use the property to meet another Federal Government need (e.g., 
by transferring accountability for the property to another Federal 
award to the same recipient, or by directing the recipient to transfer 
the property to a Federal agency that needs the property or to another 
recipient with a currently funded award).
    (2) Declare the property to be excess property and either:
    (i) Report the property to the General Services Administration 
through EADS, in accordance with the Federal Property and 
Administrative Services Act of 1949 (40 U.S.C. 483(b)(2)), as 
implemented by General Services Administration regulations at 41 CFR 
101-47.202; or
    (ii) Dispose of the property by alternative methods, if there is 
authority under law, such as 15 U.S.C. 3710(i).


Sec.  600.323  Property management system.

    The recipient's property management system must include the 
following:
    (a) Property records must be maintained, to include the following 
information for property that is Federally owned, equipment that is 
acquired in whole or in part with Federal funds, or property or 
equipment that is used as cost sharing or matching:
    (1) A description of the property.
    (2) Manufacturer's serial number, model number, Federal stock 
number, national stock number, or any other identification number.
    (3) Source of the property, including the award number.
    (4) Whether title vests in the recipient or the Federal Government.
    (5) Acquisition date (or date received, if the property was 
furnished by the Federal Government) and cost.
    (6) Information from which one can calculate the percentage of 
Federal participation in the cost of the property (not applicable to 
property furnished by the Federal Government).
    (7) The location and condition of the property and the date the 
information was reported.
    (8) Ultimate disposition data, including data of disposal and sales 
price or the method used to determine current fair market value where a 
recipient compensates the Federal Government for its share.
    (b) Federal owned equipment must be marked to indicate Federal 
ownership.
    (c) A physical inventory must be taken and the results reconciled 
with the property records at least once every two years. Any 
differences between quantities determined by the physical inspection 
and those shown in the accounting records must be investigated to 
determine the causes of the difference. The recipient must, in 
connection with the inventory, verify the existence, current 
utilization, and continued need for the property.
    (d) A control system must be in effect to insure adequate 
safeguards to prevent loss, damage, or theft of the property. Any loss, 
damage, or theft of property must be investigated and fully documented. 
If the property is owned by the Federal Government, the recipient must 
promptly notify the Federal agency responsible for administering the 
property.
    (e) Adequate maintenance procedures must be implemented to keep the 
property in good condition.


Sec.  600.324  Supplies.

    (a) Title vests in the recipient upon acquisition of supplies 
acquired with Federal funds under an award.
    (b) Upon termination or completion of the project or program, the 
recipient may retain any unused supplies. If the inventory of unused 
supplies exceeds $5,000 in total aggregate value and the items are not 
needed for any other Federally sponsored project or program, the 
recipient may retain the items for use on non-Federal sponsored 
activities or sell them, but must, in either case, compensate the 
Federal Government for its share.


Sec.  600.325  Intellectual property.

    (a) Scope. This section sets forth the policies with regard to 
disposition of rights to data and to inventions conceived or first 
actually reduced to practice in the course of, or under, a grant or 
cooperative agreement with DOE.
    (b) Patents right--small business concerns. In accordance with 35 
U.S.C. 202, if the recipient is a small business concern and receives a 
grant, cooperative agreement, subaward, or contract for research, 
developmental, or demonstration activities, then, unless there are 
``exceptional circumstances'' as described in 35 U.S.C. 202(e), the 
award must contain the standard clause in Appendix A to this subpart, 
entitled ``Patents Rights (Small Business Firms and Nonprofit 
Organizations'' which provides to the recipient the right to elect 
ownership of inventions made under the award.
    (c) Patent rights--other than small business concerns, e.g., large 
businesses.
    (1) No Patent Waiver. Except as provided by paragraph (c)(2) of 
this section, if the recipient is a for-profit organization other than 
a small business concern, as defined in 35 U.S.C. 201(h) and receives 
an award or a subaward for research, development, and demonstration 
activities, then, pursuant to statute, the award must contain the 
standard clause in Appendix A to this subpart, entitled ``Patent Rights 
(Large Business Firms)--No Waiver'' which provides that DOE owns the 
patent rights to inventions made under the award.
    (2) Patent Waiver Granted. Paragraph (c)(1) of this section does 
not apply if:
    (i) DOE grants a class waiver for a particular program under 10 CFR 
part 784;
    (ii) The applicant requests and receives an advance patent waiver 
under 10 CFR part 784; or
    (iii) A subaward is covered by a waiver granted under the prime 
award.
    (3) Special Provision. Normally, an award will not include a 
background patent and data provision. However, under special 
circumstances, in order to provide heightened assurance of 
commercialization, a provision providing for a right to require 
licensing of third parties to background inventions, limited rights 
data and/or restricted computer software, may be included. Inclusion of 
a background patent and/or a data provision to assure commercialization 
will be done only with the written concurrence of the DOE program 
official setting forth the need for such assurance. An award may 
include the right to license the Government and third party contractors 
for special Government purposes when future availability of the 
technology would also benefit the government, e.g.,

[[Page 50658]]

clean-up of DOE facilities. The scope of any such background patent 
and/or data licensing provision is subject to negotiation.
    (d) Rights in data--general rule.
    (1) Subject to paragraphs (d)(2) and (3) of this section, and 
except as otherwise provided by paragraphs (e) and (f) of this section 
or other law, any award under this subpart must contain the standard 
clause in Appendix A to this subpart, entitled ``Rights in Data--
General''.
    (2) Normally, an award will not require the delivery of limited 
rights data or restricted computer software. However, if the 
contracting officer, in consultation with DOE patent counsel and the 
DOE program official, determines that delivery of limited rights data 
or restricted computer software is necessary, the contracting officer, 
after negotiation with the applicant, may insert in the award the 
standard clause as modified by Alternates I and/or II set forth in 
Appendix A to this subpart.
    (3) If software is specified for delivery to DOE, or if other 
special circumstances exist, e.g., DOE specifying ``open-source'' 
treatment of software, then the contracting officer, after negotiation 
with the recipient, may include in the award special provisions 
requiring the recipient to obtain written approval of the contracting 
officer prior to asserting copyright in the software, modifying the 
retained Government license, and/or otherwise altering the copyright 
provisions.
    (e) Rights in data--programs covered under special protected data 
statutes.
    (1) If a statute, other than those providing for the Small Business 
Innovation Research (SBIR) and Small Business Technology Transfer 
Research (STTR) programs, provides for a period of time, typically up 
to five years, during which data produced under an award for research, 
development, and demonstration may be protected from public disclosure, 
then the contracting officer must insert in the award the standard 
clause in Appendix A to this subpart entitled ``Rights in Data--
Programs Covered Under Special Protected Data Statutes'' or, as 
determined in consultation with DOE patent counsel and the DOE program 
official, a modified version of such clause which may identify data or 
categories of data that the recipient must make available to the 
public.
    (2) An award under paragraph (e)(1) of this section is subject to 
the provisions of paragraphs (d)(2) and (3) of this section.
    (f) Rights in data--SBIR/STTR programs. (1) If an applicant 
receives an award under the SBIR or STTR program, then the contracting 
officer must insert in the award the standard data clause in the 
General Terms and Conditions for SBIR Grants, entitled ``Rights in 
Data--SBIR Program''.
    (2) The data rights provisions for SBIR/STTR grants are contained 
in the award terms and conditions for SBIR grants located at http://e-center.doe.gov on the Professionals Homepage under Financial 
Assistance, Regulations and Guidance.
    (g) Authorization and consent. (1) Work performed by a recipient 
under a grant is not subject to authorization and consent to the use of 
a patented invention, and the Government assumes no liability for 
patent infringement by the recipient under 28 U.S.C. 1498.
    (2) Work performed by a recipient under a cooperative agreement is 
subject to authorization and consent to the use of a patented invention 
consistent with the principles set forth in 48 CFR 27.201-1.
    (3) The contracting officer, in consultation with patent counsel, 
may also include clauses in the cooperative agreement addressing other 
patent matters related to authorization and consent, such as patent 
indemnification of the Government by recipient and notice and 
assistance regarding patent and copyright infringement. The policies 
and clauses for these other patent matters will be the same or 
consistent with those in 48 CFR part 927.

Procurement Standards


Sec.  600.330  Purpose of procurement standards.

    Section 600.331 sets forth requirements necessary to ensure:
    (a) Recipients' procurements that use Federal funds comply with 
applicable Federal statutes, regulations, and executive orders.
    (b) Proper stewardship of Federal funds used in recipients' 
procurements.


Sec.  600.331  Requirements.

    The following requirements pertain to recipients' procurements 
funded in whole or in part with Federal funds or with recipients' cost-
share or match:
    (a) Reasonable cost. Recipients' procurement procedures must use 
best commercial practices to ensure reasonable cost for procured goods 
and services. Recipients are encouraged to buy commercial items, if 
practicable.
    (b) Pre-award review of certain procurements. If the contracting 
officer determines that there is a compelling need to perform a pre-
award review of a specific transaction and the terms of the award 
identify the specific transaction and provide for such a review, then 
the recipient must obtain the contracting officer's approval prior to 
awarding the transaction and must provide the contracting officer the 
following documents to review:
    (1) Request for proposals or invitation to bid, if any;
    (2) Cost estimate;
    (3) Proposal/bid;
    (4) Proposed award document; and
    (5) Summary of negotiations or justification for award.
    (c) Contract provisions. (1) Contracts in excess of the simplified 
acquisition threshold must contain contractual provisions or conditions 
that allow for administrative, contractual, or legal remedies in 
instances in which a contractor violates or breaches the contract 
terms, and provide for such remedial actions as may be appropriate.
    (2) All contracts in excess of the simplified acquisition threshold 
must contain suitable provisions for termination for default by the 
recipient and for termination due to circumstances beyond the control 
of the contractor.
    (3) All negotiated contracts in excess of the simplified 
acquisition threshold must include a provision permitting access of 
DOE, the Inspector General, the Comptroller General of the United 
States, or any of their duly authorized representatives, to any books, 
documents, papers, and records of the contractor that are directly 
pertinent to a specific programs, for the purpose of making audits, 
examinations, excerpts, transcriptions, and copies of such documents.
    (4) All contracts, including those for amounts less than the 
simplified acquisition threshold, awarded by recipients and their 
contractors must contain the procurement provisions of Appendix B to 
this subpart, as applicable.
    (d) Recipient responsibilities. The recipient is the responsible 
authority, without recourse to DOE, regarding the settlement and 
satisfaction of all contractual and administrative issues arising out 
of procurements entered into in support of an award. This includes 
disputes, claims, protests of award, source evaluation or other matters 
of a contractual nature. The recipient should refer matters concerning 
violations of statutes to such Federal, State or local authority as may 
have proper jurisdiction.

Reports and Records


Sec.  600.340  Purpose of reports and records.

    Sections 600.341 and 600.342 prescribe requirements for monitoring

[[Page 50659]]

and reporting financial and program performance and for records 
retention.


Sec.  600.341  Monitoring and reporting program and financial 
performance.

    (a) The terms and conditions of the award prescribe the reporting 
requirements, the frequency, and the due dates for reports. At a 
minimum, requirements must include:
    (1) Periodic progress reports (at least annually, but no more 
frequently than quarterly) addressing both program status and business 
status, as follows:
    (i) The program portions of the reports must address progress 
toward achieving program performance goals and milestones, including 
current issues, problems, or developments.
    (ii) The business portions of the reports must provide summarized 
details on the status of resources (Federal funds and non-Federal cost 
sharing or matching), including an accounting of expenditures for the 
period covered by the report. The report should compare the resource 
status with any payment and expenditure schedules or plans provided in 
the original award, explain any major deviations from those schedules, 
and discuss actions that will be taken to address the deviations.
    (2) A final technical report if the award is for research and 
development.
    (b) If the contracting officer previously authorized advance 
payments, pursuant to Sec.  600.312(a)(2), he/she should consult with 
the DOE project director and consider whether program progress reported 
in the periodic progress report, in relation to reported expenditures, 
is sufficient to justify continued authorization of advance payments.


Sec.  600.342  Retention and access requirements for records.

    (a) This section sets forth requirements for records retention and 
access to records for awards to recipients and subrecipients.
    (b) Financial records, supporting documents, statistical records, 
and all other records pertinent to an award must be retained for a 
period of three years from the date of submission of the final 
expenditure report. The only exceptions are the following.
    (1) If any litigation, claim, or audit is started before the 
expiration of the 3-year period, the records must be retained until all 
litigation, claims, or audit findings involving the records have been 
resolved and final action taken.
    (2) Records for real property and equipment acquired with Federal 
funds must be retained for 3 years after final disposition.
    (3) If records are transferred to or maintained by DOE, the 3-year 
retention requirement is not applicable to the recipient.
    (4) Indirect cost rate proposals, cost allocation plans, and 
related records must be retained in accordance with the requirements 
specified in paragraph (g) of this section.
    (c) Copies of original records may be substituted for the original 
records if authorized by the contracting officer.
    (d) The contracting officer may request that recipients transfer 
certain records to DOE custody if he or she determines that the records 
possess long term retention value. However, in order to avoid duplicate 
recordkeeping, a contracting officer may make arrangements for 
recipients to retain any records that are continuously needed for joint 
use.
    (e) DOE, the Inspector General, Comptroller General of the United 
States, or any of their duly authorized representatives, have the right 
of timely and unrestricted access to any books, documents, papers, or 
other records of recipients that are pertinent to the awards, in order 
to make audits, examinations, excerpts, transcripts and copies of such 
documents. This right also includes timely and reasonable access to a 
recipient's personnel for the purpose of interview and discussion 
related to such documents. The rights of access in this paragraph are 
not limited to the required retention period, but must last as long as 
records are retained.
    (f) Unless required by statute, DOE must not place restrictions on 
recipients that limit public access to the records of recipients that 
are pertinent to an award, except when DOE can demonstrate that such 
records would be kept confidential and would be exempt from disclosure 
pursuant to the Freedom of Information Act (5 U.S.C. 552) if the 
records belonged to DOE.
    (g) Indirect cost proposals, cost allocation plans, and other cost 
accounting documents (such as documents related to computer usage 
chargeback rates), along with their supporting records, must be 
retained for a 3-year period, as follows:
    (1) If the recipient or the subrecipient is required to submit an 
indirect-cost proposal, cost allocation plan, or other computation to 
the cognizant Federal agency for purposes of negotiating an indirect 
cost rate or other rates, the 3-year retention period starts on the 
date of the submission.
    (2) If the recipient or the subrecipient is not required to submit 
the documents or supporting records for negotiating an indirect cost 
rate or other rates, the 3-year retention period for the documents and 
records starts at the end of the fiscal year (or other accounting 
period) covered by the proposal, plan, or other computation.
    (h) If the information described in this section is maintained on a 
computer, recipients must retain the computer data on a reliable medium 
for the time periods prescribed. Recipients may transfer computer data 
in machine readable form from one reliable computer medium to another. 
Recipients' computer data retention and transfer procedures must 
maintain the integrity, reliability, and security of the original 
computer data. Recipients must also maintain an audit trail describing 
the data transfer. For the record retention time periods prescribed in 
this section, recipients must not destroy, discard, delete, or write 
over such computer data.

Termination and Enforcement


Sec.  600.350  Purpose of termination and enforcement.

    Sections 600.351 through 600.353 set forth uniform procedures for 
suspension, termination, enforcement, and disputes.


Sec.  600.351  Termination.

    (a) Awards may be terminated in whole or in part only in accordance 
with one of the following:
    (1) By the contracting officer, if a recipient materially fails to 
comply with the terms and conditions of an award.
    (2) By the contracting officer with the consent of the recipient, 
in which case the two parties must agree upon the termination 
conditions, including the effective date and, in the case of partial 
termination, the portion to be terminated.
    (3) By the recipient upon sending to the contracting officer 
written notification setting forth the reasons for such termination, 
the effective date, and, in the case of partial termination, the 
portion to be terminated. The recipient must provide such notice at 
least 30 calendar days prior to the effective date of the termination. 
However, if the contracting officer determines in the case of partial 
termination that the reduced or modified portion of the award will not 
accomplish the purposes for which the award was made, he or she may 
terminate the award in its entirety.
    (b) If the recipient incurred allowable costs prior to the 
termination, the responsibilities of the recipient referred to in Sec.  
600.361(b), including those related to property, apply to the 
termination of the award, and provision must be made for continuing

[[Page 50660]]

responsibilities of the recipient after termination, as appropriate.


Sec.  600.352  Enforcement.

    (a) Remedies for noncompliance. If a recipient materially fails to 
comply with the terms and conditions of an award, whether stated in a 
Federal statute, regulation, assurance, application, or notice of 
award, the contracting officer may, in addition to imposing any of the 
special conditions outlined in Sec.  600.304, take one or more of the 
following actions, as appropriate:
    (1) Temporarily withhold cash payments pending correction of the 
deficiency by the recipient or more severe enforcement action by the 
contracting officer.
    (2) Disallow (that is, deny both the use of funds and any 
applicable matching credit for) all or part of the cost of the activity 
or action not in compliance.
    (3) Wholly or partly suspend or terminate the current award.
    (4) Withhold further awards for the project or program.
    (5) Apply other remedies that may be legally available.
    (b) Hearings and appeals. In taking an enforcement action, DOE must 
provide the recipient an opportunity for hearing, appeal, or other 
administrative proceeding to which the recipient is entitled under any 
statute or regulation applicable to the action involved.
    (c) Effects of suspension and termination. Costs resulting from 
obligations incurred by the recipient during a suspension or after 
termination of an award are not allowable, unless the contracting 
officer expressly authorizes them in the notice of suspension or 
termination or subsequently authorizes such costs. Other recipient 
costs during suspension or after termination, which are necessary and 
not reasonably avoidable, are allowable if the costs:
    (1) Result from obligations which were properly incurred by the 
recipient before the effective date of suspension or termination, are 
not in anticipation of it, and in the case of a termination, are 
noncancellable; and
    (2) Would be allowable if the award expired normally at the end of 
the funding period.
    (d) Relationship to debarment and suspension. The enforcement 
remedies identified in this section, including suspension and 
termination, do not preclude a recipient from being subject to 
debarment and suspension under 10 CFR part 1036.


Sec.  600.353  Disputes and appeals.

    Consistent with 10 CFR 600.22 and part 1024, recipients have the 
right to appeal certain decisions by contracting officers.

After-the-Award Requirements


Sec.  600.360  Purpose.

    Sections 600.361 through 600.363 contain procedures for closeout 
and for subsequent disallowances and adjustments.


Sec.  600.361  Closeout procedures.

    (a) Recipients must submit, within 90 calendar days after the date 
of completion of the award, all reports required by the terms and 
conditions of the award. DOE may approve extensions when requested by 
the recipient.
    (b) The following provisions must apply to the closeout:
    (1) Unless DOE authorizes an extension, a recipient must liquidate 
all obligations incurred under the award not later than 90 calendar 
days after the funding period or the date of completion of the award as 
specified in the terms and conditions of the award or in agency 
implementing instructions.
    (2) DOE must make prompt, final payments to a recipient for 
allowable reimbursable costs under the award being closed out.
    (3) The recipient must promptly refund any unobligated balances of 
cash that DOE has advanced or paid and that are not authorized to be 
retained by the recipient for use in other projects. OMB Circular A-129 
governs unreturned amounts that become delinquent debts.
    (4) When authorized by the terms and conditions of the award, the 
contracting officer must make a settlement for any upward or downward 
adjustments to the Federal share of costs after closeout reports are 
received.
    (5) The recipient must account for any real property and equipment 
acquired with Federal funds or received from the Federal Government in 
accordance with Sec. Sec.  600.321 through 600.325.
    (6) If a final audit is required and has not been performed prior 
to the closeout of an award, DOE retains the right to recover an 
appropriate amount after fully considering the recommendations on 
disallowed costs resulting from the final audit.


Sec.  600.362  Subsequent adjustments and continuing responsibilities.

    (a) The closeout of an award does not affect any of the following:
    (1) The right of DOE to disallow costs and recover funds on the 
basis of a later audit or other review.
    (2) The obligation of the recipient to return any funds due as a 
result of later refunds, corrections, or other transactions.
    (3) Audit requirements in Sec.  600.316.
    (4) Property management requirements in Sec. Sec.  600.321 through 
600.325.
    (5) Records retention requirements in Sec.  600.342.
    (b) After closeout of an award, the continuing responsibilities 
under an award may be modified or ended in whole or in part with the 
consent of the contracting officer and the recipient, provided property 
management requirements are considered and provisions made for the 
continuing responsibilities of the recipient, as appropriate.


Sec.  600.363  Collection of amounts due.

    (a) Any funds paid to a recipient in excess of the amount to which 
the recipient is finally determined to be entitled under the terms and 
conditions of the award constitute a debt to the Federal Government. If 
not paid within 30 days after the demand for payment, DOE may reduce 
the debt in accordance with the procedures and techniques described in 
10 CFR part 1015 and OMB Circular A-129, including:
    (1) Making an administrative offset against other requests for 
reimbursements.
    (2) Withholding advance payments otherwise due to the recipient.
    (3) Taking other action permitted by statute or regulation.
    (b) Except as otherwise provided by law, DOE may charge interest 
and administrative fees on an overdue debt in accordance with 31 CFR 
Chapter IX, parts 900-904, ``Federal Claims Collection Standards.''

Additional Provisions


Sec.  600.380  Purpose.

    The purpose of ``Additional Provisions'' is to provide alternative 
requirements for recipients otherwise covered by this subpart D, when 
they are performing under Small Business Innovation Research grants.


Sec.  600.381  Special provisions for Small Business Innovation 
Research Grants.

    (a) General. This section contains provisions applicable to the 
Small Business Innovation Reserach (SBIR) Program.
    (b) Provisions Applicable to Phase I SBIR Awards: Phase I SBIR 
awards may be made on a fixed obligation basis, subject to the 
following requirements.
    (1) While proposed costs must be analyzed in detail to ensure 
consistency with applicable cost principles, incurred costs are not 
subject to review under the standards of cost allowability.
    (2) Although detailed budgets are submitted by a recipient and 
reviewed by DOE for purposes of establishing the

[[Page 50661]]

amount to be awarded, budget categories are not stipulated in making an 
award;
    (3) Prior approval from the DOE for rebudgeting among categories by 
the recipient is not required. Prior approval from DOE is required for 
any variation from the requirement that no more than one-third of Phase 
I work can be done by subcontractors or consortium partners;
    (4) Pre-award expenditure approval is not required;
    (5) Payments are to be made in the same manner as other financial 
assistance (see Sec.  600.312), except that, when determined 
appropriate by the cognizant program official and contracting officer, 
a lump sum payment may be made. If a lump sum payment is made, the 
award must contain a condition that requires the recipient to return to 
DOE amounts remaining unexpended at the end of the project if those 
amounts exceed $500;
    (6) Recipients will certify in writing to the Contracting Officer 
at the end of the project that the activity was completed or the level 
of effort was expended. Should the activity or effort not be carried 
out, the recipeint would be expected to make appropriate 
reimbursements;
    (7) Requirements for periodic reports may be established for each 
award so long as they are consistent with Sec.  600.341;
    (8) Changes in principal investigator or project leader, scope of 
effort, or institution, require the prior approval of DOE.
    (c) Provision Applicable to Phase II SBIR Awards. Phase II SBIR 
awards may be made for a single budget period of 24 months.
    (d) Provisions Applicable to Phase I and Phase II SBIR Awards.
    (1) The prior approval of the cognizant DOE Contracting Officer is 
required before the final budget period of the project period may be 
extended without additional funds.
    (2) A fee or profit may be paid to SBIR recipients.

Appendix A to Subpart D to Part 600--Patent and Data Provisions

1. Patent Rights (Small Business Firms and Nonprofit Organizations)
2. Patent Rights (Large Business Firms)--No Waiver
3. Rights in Data--General
4. Rights in Data--Programs Covered Under Special Protected Data 
Statutes

Patent Rights (Small Business Firms and Nonprofit Organizations)

(a) Definitions

    Invention means any invention or discovery which is or may be 
patentable or otherwise protectable under title 35 of the United 
States Code, or any novel variety of plant which is or may be 
protected under the Plant Variety Protection Act (7 U.S.C. 2321 et 
seq.).
    Made when used in relation to any invention means the conception 
or first actual reduction to practice of such invention.
    Nonprofit organization means a university or other institution 
of higher education or an organization of the type described in 
section 501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C. 
501(c)) and exempt from taxation under section 501(a) of the 
Internal Revenue Code (26 U.S.C. 501(a)) or any nonprofit scientific 
or educational organization qualified under a State nonprofit 
organization statute.
    Practical application means to manufacture in the case of a 
composition or product, to practice in the case of a process or 
method, or to operate in the case of a machine or system; and, in 
each case, under such conditions as to establish that the invention 
is being utilized and that its benefits are to the extent permitted 
by law or Government regulations available to the public on 
reasonable terms.
    Small business firm means a small business concern as defined at 
section 2 of Public Law 85-536 (16 U.S.C. 632) and implementing 
regulations of the Administrator of the Small Business 
Administration. For the purpose of this clause, the size standards 
for small business concerns involved in Government procurement and 
subcontracting at 13 CFR 121.3 through 121.8 and 13 CFR 121.3 
through 121.12, respectively, will be used.
    Subject invention means any invention of the Recipient conceived 
or first actually reduced to practice in the performance of work 
under this award, provided that in the case of a variety of plant, 
the date of determination (as defined in section 41(d) of the Plant 
Variety Protection Act, 7 U.S.C. 2401(d) must also occur during the 
period of award performance.

(b) Allocation of Principal Rights

    The Recipient may retain the entire right, title, and interest 
throughout the world to each subject invention subject to the 
provisions of this Patent Rights clause and 35 U.S.C. 203. With 
respect to any subject invention in which the Recipient retains 
title, the Federal Government shall have a non-exclusive, 
nontransferable, irrevocable, paid-up license to practice or have 
practiced for or on behalf of the U.S. the subject invention 
throughout the world.

(c) Invention Disclosure, Election of Title and Filing of Patent 
Applications by Recipient

    (1) The Recipient will disclose each subject invention to DOE 
within two months after the inventor discloses it in writing to 
Recipient personnel responsible for the administration of patent 
matters. The disclosure to DOE shall be in the form of a written 
report and shall identify the award under which the invention was 
made and the inventor(s). It shall be sufficiently complete in 
technical detail to convey a clear understanding to the extent known 
at the time of disclosure, of the nature, purpose, operation, and 
the physical, chemical, biological or electrical characteristics of 
the invention. The disclosure shall also identify any publication, 
on sale or public use of the invention and whether a manuscript 
describing the invention has been submitted for publication and, if 
so, whether it has been accepted for publication at the time of 
disclosure. In addition, after disclosure to DOE, the Recipient will 
promptly notify DOE of the acceptance of any manuscript describing 
the invention for publication or of any on sale or public use 
planned by the Recipient.
    (2) The Recipient will elect in writing whether or not to retain 
title to any such invention by notifying DOE within two years of 
disclosure to DOE. However, in any case where publication, on sale, 
or public use has initiated the one-year statutory period wherein 
valid patent protection can still be obtained in the U.S., the 
period for election of title may be shortened by the agency to a 
date that is no more than 60 days prior to the end of the statutory 
period.
    (3) The Recipient will file its initial patent application on an 
invention to which it elects to retain title within one year after 
election of title or, if earlier, prior to the end of any statutory 
period wherein valid patent protection can be obtained in the U.S. 
after a publication, on sale, or public use. The Recipient will file 
patent applications in additional countries or international patent 
offices within either ten months of the corresponding initial patent 
application, or six months from the date when permission is granted 
by the Commissioner of Patents and Trademarks to file foreign patent 
applications when such filing has been prohibited by a Secrecy 
Order.
    (4) Requests for extension of the time for disclosure to DOE, 
election, and filing under subparagraphs (c)(1), (2), and (3) of 
this clause may, at the discretion of DOE, be granted.

(d) Conditions When the Government May Obtain Title

    The Recipient will convey to DOE, upon written request, title to 
any subject invention:
    (1) If the Recipient fails to disclose or elect the subject 
invention within the times specified in paragraph (c) of this patent 
rights clause, or elects not to retain title; provided that DOE may 
only request title within 60 days after learning of the failure of 
the Recipient to disclose or elect within the specified times;
    (2) In those countries in which the Recipient fails to file 
patent applications within the times specified in paragraph (c) of 
this Patent Rights clause; provided, however, that if the Recipient 
has filed a patent application in a country after the times 
specified in paragraph (c) of this Patent Rights clause, but prior 
to its receipt of the written request of DOE, the Recipient shall 
continue to retain title in that country; or
    (3) In any country in which the Recipient decides not to 
continue the prosecution of any application for, to pay the 
maintenance fees on, or defend in a reexamination or opposition 
proceeding on, a patent on a subject invention.

[[Page 50662]]

(e) Minimum Rights to Recipient and Protection of the Recipient Right 
To File

    (1) The Recipient will retain a non-exclusive royalty-free 
license throughout the world in each subject invention to which the 
Government obtains title, except if the Recipient fails to disclose 
the subject invention within the times specified in paragraph (c) of 
this Patent Rights clause. The Recipient's license extends to its 
domestic subsidiaries and affiliates, if any, within the corporate 
structure of which the Recipient is a party and includes the right 
to grant sublicenses of the same scope of the extent the Recipient 
was legally obligated to do so at the time the award was awarded. 
The license is transferable only with the approval of DOE except 
when transferred to the successor of that part of the Recipient's 
business to which the invention pertains.
    (2) The Recipient's domestic license may be revoked or modified 
by DOE to the extent necessary to achieve expeditious practical 
application of the subject invention pursuant to an application for 
an exclusive license submitted in accordance with applicable 
provisions at 37 CFR part 404 and the agency's licensing regulation, 
if any. This license will not be revoked in that field of use or the 
geographical areas in which the Recipient has achieved practical 
application and continues to make the benefits of the invention 
reasonably accessible to the public. The license in any foreign 
country may be revoked or modified at discretion of the funding 
Federal agency to the extent the Recipient, its licensees, or its 
domestic subsidiaries or affiliates have failed to achieve practical 
application in that foreign country.
    (3) Before revocation or modification of the license, the 
funding Federal agency will furnish the Recipient a written notice 
of its intention to revoke or modify the license, and the Recipient 
will be allowed thirty days (or such other time as may be authorized 
by DOE for good cause shown by the Recipient) after the notice to 
show cause why the license should not be revoked or modified. The 
Recipient has the right to appeal, in accordance with applicable 
regulations in 37 CFR part 404 and the agency's licensing 
regulations, if any, concerning the licensing of Government-owned 
inventions, any decision concerning the revocation or modification 
of its license.

(f) Recipient Action To Protect Government's Interest

    (1) The Recipient agrees to execute or to have executed and 
promptly deliver to DOE all instruments necessary to:
    (i) Establish or confirm the rights the Government has 
throughout the world in those subject inventions for which the 
Recipient retains title; and
    (ii) Convey title to DOE when requested under paragraph (d) of 
this Patent Rights clause, and to enable the government to obtain 
patent protection throughout the world in that subject invention.
    (2) The Recipient agrees to require, by written agreement, its 
employees, other than clerical and non-technical employees, to 
disclose promptly in writing to personnel identified as responsible 
for the administration of patent matters and in a format suggested 
by the Recipient each subject invention made under this award in 
order that the Recipient can comply with the disclosure provisions 
of paragraph (c) of this Patent Rights clause, and to execute all 
papers necessary to file patent applications on subject inventions 
and to establish the Government's rights in the subject inventions. 
The disclosure format should require, as a minimum, the information 
requested by paragraph (c)(1) of this Patent Rights clause. The 
Recipient shall instruct such employees through the employee 
agreements or other suitable educational programs on the importance 
of reporting inventions in sufficient time to permit the filing of 
patent applications prior to U.S. or foreign statutory bars.
    (3) The Recipient will notify DOE of any decision not to 
continue prosecution of a patent application, pay maintenance fees, 
or defend in a reexamination or opposition proceeding on a patent, 
in any country, not less than 30 days before the expiration of the 
response period required by the relevant patent office.
    (4) The Recipient agrees to include, within the specification of 
any U.S. patent application and any patent issuing thereon covering 
a subject invention, the following statement: ``This invention was 
made with Government support under (identify the award) awarded by 
(identify DOE). The Government has certain rights in this 
invention.''

(g) Subaward/Contract

    (1) The Recipient will include this Patent Rights clause, 
suitably modified to identify the parties, in all subawards/
contracts, regardless of tier, for experimental, developmental or 
research work to be performed by a small business firm or nonprofit 
organization. The subrecipient/contractor will retain all rights 
provided for the Recipient in this Patent Rights clause, and the 
Recipient will not, as part of the consideration for awarding the 
subcontract, obtain rights in the subcontractors' subject 
inventions.
    (2) The Recipient will include in all other subawards/contracts, 
regardless of tier, for experimental, developmental or research 
work, the patent rights clause required by 10 CFR 600.325(c).
    (3) In the case of subawards/contracts at any tier, DOE, the 
Recipient, and the subrecipient/contractor agree that the mutual 
obligations of the parties created by this clause constitute a 
contract between the subrecipient/contractor and DOE with respect to 
those matters covered by the clause.

(h) Reporting on Utilization of Subject Inventions

    The Recipient agrees to submit on request periodic reports no 
more frequently than annually on the utilization of a subject 
invention or on efforts at obtaining such utilization that are being 
made by the Recipient or its licensees or assignees. Such reports 
shall include information regarding the status of development, date 
of first commercial sale or use, gross royalties received by the 
Recipient and such other data and information as DOE may reasonably 
specify. The Recipient also agrees to provide additional reports in 
connection with any march-in proceeding undertaken by DOE in 
accordance with paragraph (j) of this Patent Rights clause. As 
required by 35 U.S.C. 202(c)(5), DOE agrees it will not disclose 
such information to persons outside the Government without the 
permission of the Recipient.

(i) Preference for United States Industry.

    Notwithstanding any other provision of this Patent Rights 
clause, the Recipient agrees that neither it nor any assignee will 
grant to any person the exclusive right to use or sell any subject 
invention in the U.S. unless such person agrees that any products 
embodying the subject invention or produced through the use of the 
subject invention will be manufactured substantially in the U.S. 
However, in individual cases, the requirement for such an agreement 
may be waived by DOE upon a showing by the Recipient or its assignee 
that reasonable but unsuccessful efforts have been made to grant 
licenses on similar terms to potential licensees that would be 
likely to manufacture substantially in the U.S. or that under the 
circumstances domestic manufacture is not commercially feasible.

(j) March-in-Rights

    The Recipient agrees that with respect to any subject invention 
in which it has acquired title, DOE has the right in accordance with 
procedures at 37 CFR 401.6 and any supplemental regulations of the 
Agency to require the Recipient, an assignee or exclusive licensee 
of a subject invention to grant a non-exclusive, partially 
exclusive, or exclusive license in any field of use to a responsible 
applicant or applicants, upon terms that are reasonable under the 
circumstances and if the Recipient, assignee, or exclusive licensee 
refuses such a request, DOE has the right to grant such a license 
itself if DOE determines that:
    (1) Such action is necessary because the Recipient or assignee 
has not taken or is not expected to take within a reasonable time, 
effective steps to achieve practical application of the subject 
invention in such field of use;
    (2) Such action is necessary to alleviate health or safety needs 
which are not reasonably satisfied by the Recipient, assignee, or 
their licensees;
    (3) Such action is necessary to meet requirements for public use 
specified by Federal regulations and such requirements are not 
reasonably satisfied by the Recipient, assignee, or licensee; or
    (4) Such action is necessary because the agreement required by 
paragraph (i) of this Patent Rights clause has not been obtained or 
waived or because a licensee of the exclusive right to use or sell 
any subject invention in the U.S. is in breach of such agreement.

(k) Special Provisions for Awards With Nonprofit Organizations

    If the Recipient is a nonprofit organization, it agrees that:
    (1) Rights to a subject invention in the U.S. may not be 
assigned without the approval of DOE, except where such assignment 
is made

[[Page 50663]]

to an organization which has as one of its primary functions the 
management of inventions, provided that such assignee will be 
subject to the same provisions as the Recipient;
    (2) The Recipient will share royalties collected on a subject 
invention with the inventor, including Federal employee co-inventors 
(when DOE deems it appropriate) when the subject invention is 
assigned in accordance with 35 U.S.C. 202(e) and 37 CFR 401.10;
    (3) The balance of any royalties or income earned by the 
Recipient with respect to subject inventions, after payment of 
expenses (including payments to inventors) incidental to the 
administration of subject inventions, will be utilized for the 
support of scientific or engineering research or education; and
    (4) It will make efforts that are reasonable under the 
circumstances to attract licensees of subject inventions that are 
small business firms and that it will give preference to a small 
business firm if the Recipient determines that the small business 
firm has a plan or proposal for marketing the invention which, if 
executed, is equally likely to bring the invention to practical 
application as any plans or proposals from applicants that are not 
small business firms; provided that the Recipient is also satisfied 
that the small business firm has the capability and resources to 
carry out its plan or proposal. The decision whether to give a 
preference in any specific case will be at the discretion of the 
Recipient. However, the Recipient agrees that the Secretary of 
Commerce may review the Recipient's licensing program and decisions 
regarding small business applicants, and the Recipient will 
negotiate changes to its licensing policies, procedures or practices 
with the Secretary when the Secretary's review discloses that the 
Recipient could take reasonable steps to implement more effectively 
the requirements of this paragraph (k)(4).

(l) Communications

    All communications required by this Patent Rights clause should 
be sent to the DOE Patent Counsel address listed in the Award 
Document.

(m) Electronic Filing

    Unless otherwise Specified in the award, the information 
identified in paragraphs (f)(2) and (f)(3) may be electronically 
filed.

[End of clause]

Patent Rights (Large Business Firms)--No Waiver

(a) Definitions

    DOE patent waiver regulations, as used in this clause, means the 
Department of Energy patent waiver regulations in effect on the date 
of award. See 10 CFR part 784.
    Invention, as used in this clause, means any invention or 
discovery which is or may be patentable of otherwise protectable 
under title 35 of the United States Code or any novel variety of 
plant that is or may be protectable under the Plant Variety 
Protection Act (7 U.S.C. 2321, et seq.).
    Patent Counsel, as used in this clause, means the Department of 
Energy Patent Counsel assisting the awarding activity.
    Subject invention, as used in this clause, means any invention 
of the Recipient conceived or first actually reduced to practice in 
the course of or under this agreement.

(b) Allocations of Principal Rights

    (1) Assignment to the Government. The Recipient agrees to assign 
to the Government the entire right, title, and interest throughout 
the world in and to each subject invention, except to the extent 
that rights are retained by the Recipient under subparagraph (b)(2) 
and paragraph (d) of this clause.
    (2) Greater rights determinations. The Recipient, or an 
employee-inventor after consultation with the Recipient, may request 
greater rights than the nonexclusive license an the foreign patent 
rights provided in paragraph (d) of this clause on identified 
inventions in accordance with the DOE patent waiver regulation. Each 
determination of greater rights under this agreement shall be 
subject to paragraph (c) of this clause, unless otherwise provided 
in the greater rights determination, and to the reservations and 
conditions deemed to be appropriate by the Secretary of Energy or 
designee.

(c) Minimum Rights Acquired by the Government

    With respect to each subject invention to which the Department 
of Energy grants the Recipient principal or exclusive rights, the 
Recipient agrees to grant to the Government: A nonexclusive, 
nontransferable, irrevocable, paid-up license to practice or have 
practiced each subject invention throughout the world by or on 
behalf of the Government of the United States (including any 
Government agency); ``march-in rights'' as set forth in 37 CFR 
401.14(a)(J)); preference for U.S. industry as set forth in 37 CFR 
401.14(a)(I); periodic reports upon request, no more frequently than 
annually, on the utilization or intent of utilization of a subject 
invention in a manner consistent with 35 U.S.C. 202(c)(50; and such 
Government rights in any instrument transferring rights in a subject 
invention.

(d) Minimum Rights to the Recipient

    (1) The Recipient is hereby granted a revocable, nonexclusive, 
royalty-free license in each patent application filed in any country 
on a subject invention and any resulting patent in which the 
Government obtains title, unless the Recipient fails to disclose the 
subject invention within the times specified in subparagraph (e)(2) 
of this clause. The Recipient's license extends to its domestic 
subsidiaries and affiliates, if any, within the corporate structure 
of which the Recipient is a part and includes the right to grant 
sublicenses of the same scope to the extent the Recipient was 
legally obligated to do so at the time the agreement was awarded. 
The license is transferable only with the approval of DOE except 
when transferred to the successor of that part of the Recipient's 
business to which the invention pertains.
    (2) The Recipient may request the right to acquire patent rights 
to a subject invention in any foreign country where the Government 
has elected not to secure such rights, subject to the minimum rights 
acquired by the Government similar to paragraph (c) of this clause. 
Such request must be made in writhing to the Patent Counsel as part 
of the disclosure required by subparagraph (e)(2) of this clause, 
with a copy to the DOE Contracting Officer. DOE approval, if given, 
will be based on a determination that this would best serve the 
national interest.

(e) Invention Identification, Disclosures, and Reports

    (1) The Recipient shall establish and maintain active and 
effective procedures to assure that subject inventions are promptly 
identified and disclosed to Recipient personnel responsible for 
patent matters within 6 months of conception and/or first actual 
reduction to practice, whichever occurs first in the performance of 
work under this agreement. These procedures shall include the 
maintenance of laboratory notebooks or equivalent records and other 
records as are reasonably necessary to document the conception and/
or the first actual reduction to practice of subject inventions, and 
records that show that the procedures for identifying and disclosing 
the inventions are followed. Upon request, the Recipient shall 
furnish the Contracting Officer a description of such procedures for 
evaluation and for determination as to their effectiveness.
    (2) The Recipient shall disclose each subject invention to the 
DOE Patent Counsel with a copy to the Contracting Officer within 2 
months after the inventor discloses it in writing to Recipient 
personnel responsible for patent matters or, if earlier, within 6 
months after the Recipient becomes aware that a subject invention 
has been made, but in any event before any on sale, public use, or 
publication of such invention known to the Recipient. The disclosure 
to DOE shall be in the form of a written report and shall identify 
the agreement under which the invention was made and the 
inventor(s). It shall be sufficiently complete in technical detail 
to convey a clear understanding, to the extent known at the time of 
the disclosure, of the nature, purpose, operation, and physical, 
chemical, biological, or electrical characteristics of the 
invention. The disclosure shall also identify any publication, on 
sale, or public use of the invention and whether a manuscript 
describing the invention has been submitted for publication and, if 
so, whether it has been accepted for publication at the time of 
disclosure. In addition, after disclosure to DOE, the Recipient 
shall promptly notify Patent Counsel of the acceptance of any 
manuscript describing the invention for publication or of any on 
sale or public use planned by the Recipient. The report should also 
include any request for a greater rights determination in accordance 
with subparagraph (b)(2) of this clause. When an invention is 
disclosed to DOE under this paragraph, it shall be deemed to have 
been made in the manner specified in Sections (a)(1) and (a)(2) of 
42 U.S.C. 5908, unless the Recipient contends in writing at the time 
the invention is disclosed that it was not so made.
    (3) The Recipient shall furnish the Contracting Officer a final 
report, within 3 months after completion of the work listing all 
subject inventions or containing a statement that there were no such 
inventions,

[[Page 50664]]

and listing all subawards/contracts at any tier containing a patent 
rights clause or containing a statement that there were no such 
subawards/contracts.
    (4) The Recipient agrees to require, by written agreement, its 
employees, other than clerical and nontechnical employees, to 
disclose promptly in writing to personnel identified as responsible 
for the administration of patent matters and in a format suggested 
by the Recipient each subject invention made under subaward/contract 
in order that the Recipient can comply with the disclosure 
provisions of paragraph (c) of this clause, and to execute all 
papers necessary to file patent applications on subject inventions 
and to establish the Government's rights in the subject inventions. 
This disclosure format should require, as a minimum, the information 
required by subparagraph (e)(2) of this clause.
    (5) The Recipient agrees, subject to FAR 27.302(j), that the 
Government may duplicate and disclose subject invention disclosures 
and all other reports and papers furnished or required to be 
furnished pursuant to this clause.

(f) Examination of Records Relating to Inventions

    (1) The Contracting Officer or any authorized representative 
shall, until 3 years after final payment under this agreement, have 
the right to examine any books (including laboratory notebooks), 
records, and documents of the Recipient relating to the conception 
or first actual reduction to practice of inventions in the same 
field of technology as the work under this agreement to determine 
whether--
    (i) Any such inventions are subject inventions;
    (ii) The Recipient has established and maintains the procedures 
required by subparagraphs (e)(1) and (4) of this clause;
    (iii) The Recipient and its inventors have complied with the 
procedures.
    (2) If the Contracting Officer learns of an unreported Recipient 
invention which the Contracting Officer believes may be a subject 
invention, the Recipient may be required to disclose the invention 
to DOE for a determination of ownership rights.
    (3) Any examination of records under this paragraph will be 
subject to appropriate conditions to protect the confidentiality of 
the information involved.

(g) Subaward/Contract

    (1) The recipient shall include the clause PATENT RIGHTS (SMALL 
BUSINESS FIRMS AND NONPROFIT ORGANIZATIONS) (suitably modified to 
identify the parties) in all subawards/contracts, regardless of 
tier, for experimental, developmental, demonstration, or research 
work to be performed by a small business firm or domestic nonprofit 
organization, except where the work of the subaward/contract is 
subject to an Exceptional Circumstances Determination by DOE. In all 
other subawards/contracts, regardless of tier, for experimental, 
developmental, demonstration, or research work, the Recipient shall 
include this clause (suitably modified to identify the parties), or 
an alternate clause as directed by the contracting officer. The 
Recipient shall not, as part of the consideration for awarding the 
subaward/contract, obtain rights in the subrecipient's/contractor's 
subject inventions.
    (2) In the event of a refusal by a prospective subrecipient/
contractor to accept such a clause the Recipient:
    (i) Shall promptly submit a written notice to the Contracting 
Officer setting forth the subrecipient/contractor's reasons for such 
refusal and other pertinent information that may expedite 
disposition of the matter; and
    (ii) Shall not proceed with such subaward/contract without the 
written authorization of the Contracting Officer.
    (3) In the case of subawards/contracts at any tier, DOE, the 
subrecipient/contractor, and Recipient agree that the mutual 
obligations of the parties created by this clause constitute a 
contract between the subrecipient/contractor and DOE with respect to 
those matters covered by this clause.
    (4) The Recipient shall promptly notify the Contracting Officer 
in writing upon the award of any subaward/contract at any tier 
containing a patent rights clause by identifying the subrecipient/
contractor, the applicable patent rights clause, the work to be 
performed under the subaward/contract, and the dates of award and 
estimated completion. Upon request of the Contracting Officer, the 
Recipient shall furnish a copy of such subaward/contract, and, no 
more frequently than annually, a listing of the subawards/contracts 
that have been awarded.
    (5) The Recipient shall identify all subject inventions of a 
subrecipient/contractor of which it acquires knowledge in the 
performance of this agreement and shall notify the Patent Counsel, 
with a copy to the contracting officer, promptly upon identification 
of the inventions.

(h) Atomic Energy

    (1) No claim for pecuniary award of compensation under the 
provisions of the Atomic Energy Act of 1954, as amended, shall be 
asserted with respect to any invention or discovery made or 
conceived in the course of or under this agreement.
    (2) Except as otherwise authorized in writing by the Contracting 
Officer, the Recipient will obtain patent agreements to effectuate 
the provisions of subparagraph (h)(1) of this clause from all 
persons who perform any part of the work under this agreement, 
except nontechnical personnel, such as clerical employees and manual 
laborers.

(i) Publication

    It is recognized that during the course of the work under this 
agreement, the Recipient or its employees may from time to time 
desire to release or publish information regarding scientific or 
technical developments conceived or first actually reduced to 
practice in the course of or under this agreement. In order that 
public disclosure of such information will not adversely affect the 
patent interests of DOE or the Recipient, patent approval for 
release of publication shall be secured from Patent Counsel prior to 
any such release or publication.

(j) Forfeiture of Rights in Unreported Subject Inventions

    (1) The Recipient shall forfeit and assign to the Government, at 
the request of the Secretary of Energy or designee, all rights in 
any subject invention which the Recipient fails to report to Patent 
Counsel within six months after the time the Recipient:
    (i) Files or causes to be filed a United States or foreign 
patent application thereon; or
    (ii) Submits the final report required by subparagraph (e)(3) of 
this clause, whichever is later.
    (2) However, the Recipient shall not forfeit rights in a subject 
invention if, within the time specified in subparagraph (e)(2) of 
this clause, the Recipient:
    (i) Prepares a written decision based upon a review of the 
record that the invention was neither conceived nor first actually 
reduced to practice in the course of or under the agreement and 
delivers the decision to Patent Counsel, with a copy to the 
Contracting Officer, or
    (ii) Contending that the invention is not a subject invention, 
the Recipient nevertheless discloses the invention and all facts 
pertinent to this contention to the Patent Counsel, with a copy of 
the Contracting Officer; or
    (iii) Establishes that the failure to disclose did not result 
from the Recipient's fault or negligence.
    (3) Pending written assignment of the patent application and 
patents on a subject invention determined by the Secretary of Energy 
or designee to be forfeited (such determination to be a final 
decision under the Disputes clause of this agreement), the Recipient 
shall be deemed to hold the invention and the patent applications 
and patents pertaining thereto in trust for the Government. The 
forfeiture provision of this paragraph (j) shall be in addition to 
and shall not supersede other rights and remedies which the 
Government may have with respect to subject inventions.

(End of clause)

Rights in Data--General

(a) Definitions

    Computer Data Bases, as used in this clause, means a collection 
of data in a form capable of, and for the purpose of, being stored 
in, processed, and operated on by a computer. The term does not 
include computer software.
    Computer software, as used in this clause, means (i) computer 
programs which are data comprising a series of instructions, rules, 
routines or statements, regardless of the media in which recorded, 
that allow or cause a computer to perform a specific operation or 
series of operations and (ii) data comprising source code listings, 
design details, algorithms, processes, flow charts, formulae, and 
related material that would enable the computer program to be 
produced, created or compiled. The term does not include computer 
data bases.
    Data, as used in this clause, means recorded information, 
regardless of form or the media on which it may be recorded. The 
term includes technical data and computer software. The term does 
not include

[[Page 50665]]

information incidental to administration, such as financial, 
administrative, cost or pricing, or management information.
    Form, fit, and function data, as used in this clause, means data 
relating to items, components, or processes that are sufficient to 
enable physical and functional interchangeability, as well as data 
identifying source, size, configuration, mating, and attachment 
characteristics, functional characteristics, and performance 
requirements; except that for computer software it means data 
identifying source, functional characteristics, and performance 
requirements but specifically excludes the source code, algorithm, 
process, formulae, and flow charts of the software.
    Limited rights, as used in this clause, means the rights of the 
Government in limited rights data as set forth in the Limited Rights 
Notice of subparagraph (g)(2) if included in this clause.
    Limited rights data, as used in this clause, means data (other 
than computer software) developed at private expense that embody 
trade secrets or are commercial or financial and confidential or 
privileged.
    Restricted computer software, as used in this clause, means 
computer software developed at private expense and that is a trade 
secret; is commercial or financial and is confidential or 
privileged; or is published copyrighted computer software; including 
minor modifications of such computer software.
    Restricted rights, as used in this clause, means the rights of 
the Government in restricted computer software, as set forth in a 
Restricted Rights Notice of subparagraph (g)(3) if included in this 
clause, or as otherwise may be provided in a collateral agreement 
incorporated in and made part of this contract, including minor 
modifications of such computer software.
    Technical data, as used in this clause, means data (other than 
computer software) which are of a scientific or technical nature. 
Technical data does not include computer software, but does include 
manuals and instructional materials and technical data formatted as 
a computer data base.
    Unlimited rights, as used in this clause, means the right of the 
Government to use, disclose, reproduce, prepare derivative works, 
distribute copies to the public, and perform publicly and display 
publicly, in any manner and for any purpose, and to have or permit 
others to do so.

(b) Allocations of Rights

    (1) Except as provided in paragraph (c) of this clause regarding 
copyright, the Government shall have unlimited rights in--
    (i) Data first produced in the performance of this agreement;
    (ii) Form, fit, and function data delivered under this 
agreement;
    (iii) Data delivered under this agreement (except for restricted 
computer software) that constitute manuals or instructional and 
training material for installation, operation, or routine 
maintenance and repair of items, components, or processes delivered 
or furnished for use under this agreement; and
    (iv) All other data delivered under this agreement unless 
provided otherwise for limited rights data or restricted computer 
software in accordance with paragraph (g) of this clause.
    (2) The Recipient shall have the right to--
    (i) Use, release to others, reproduce, distribute, or publish 
any data first produced or specifically used by the Recipient in the 
performance of this agreement, unless provided otherwise in 
paragraph (d) of this clause;
    (ii) Protect from unauthorized disclosure and use those data 
which are limited rights data or restricted computer software to the 
extent provided in paragraph (g) of this clause;
    (iii) Substantiate use of, add or correct limited rights, 
restricted rights, or copyright notices and to take over appropriate 
action, in accordance with paragraphs (e) and (f) of this clause; 
and
    (iv) Establish claim to copyright subsisting in data first 
produced in the performance of this agreement to the extent provided 
in subparagraph (c)(1) of this clause.

(c) Copyright

    (1) Data first produced in the performance of this agreement. 
Unless provided otherwise in paragraph (d) of this clause, the 
Recipient may establish, without prior approval of the Contracting 
Officer, claim to copyright subsisting in data first produced in the 
performance of this agreement. When claim to copyright is made, the 
Recipient shall affix the applicable copyright notices of 17 U.S.C. 
401 or 402 and acknowledgement of Government sponsorship (including 
agreement number) to the data when such data are delivered to the 
Government, as well as when the data are published or deposited for 
registration as a published work in the U.S. Copyright Office. For 
such copyrighted data, including computer software, the Recipient 
grants to the Government, and others acting on its behalf, a paid-up 
nonexclusive, irrevocable worldwide license in such copyrighted data 
to reproduce, prepare derivative works, distribute copies to the 
public, and perform publicly and display publicly, by or on behalf 
of the Government.
    (2) Data not first produced in the performance of this 
agreement. The Recipient shall not, without prior written permission 
of the Contracting Officer, incorporate in data delivered under this 
agreement any data not first produced in the performance of this 
agreement and which contains the copyright notice of 17 U.S.C. 401 
or 402, unless the Recipient identifies such data and grants to the 
Government, or acquires on its behalf, a license of the same scope 
as set forth in subparagraph (c)(1) of this clause; provided, 
however, that if such data are computer software the Government 
shall acquire a copyright license as set forth in subparagraph 
(g)(3) of this clause if included in this agreement or as otherwise 
may be provided in a collateral agreement incorporated in or made 
part of this agreement.
    (3) Removal of copyright notices. The Government agrees not to 
remove any copyright notices placed on data pursuant to this 
paragraph (c), and to include such notices on all reproductions of 
the data.

(d) Release, Publication and Use of Data

    (1) The Recipient shall have the right to use, release to 
others, reproduce, distribute, or publish any data first produced or 
specifically used by the Recipient in the performance of this 
agreement, except to the extent such data may be subject to the 
Federal export control or national security laws or regulations, or 
unless otherwise provided in this paragraph of this clause or 
expressly set forth in this agreement.
    (2) The Recipient agrees that to the extent it receives or is 
given access to data necessary for the performance of this award, 
which contain restrictive markings, the Recipient shall treat the 
data in accordance with such markings unless otherwise specifically 
authorized in writing by the contracting officer.

(e) Unauthorized Marking of Data

    (1) Notwithstanding any other provisions of this agreement 
concerning inspection or acceptance, if any data delivered under 
this agreement are marked with the notices specified in subparagraph 
(g)(2) or (g)(3) of this clause and use of such is not authorized by 
this clause, or if such data bears any other restrictive or limiting 
markings not authorized by this agreement, the Contracting Officer 
may at any time either return the data to the Recipient or cancel or 
ignore the markings. However, the following procedures shall apply 
prior to canceling or ignoring the markings.
    (i) The Contracting Officer shall make written inquiry to the 
Recipient affording the Recipient 30 days from receipt of the 
inquiry to provide written justification to substantiate the 
propriety of the markings;
    (ii) If the Recipient fails to respond or fails to provide 
written justification to substantiate the propriety of the markings 
within the 30-day period (or a longer time not exceeding 90 days 
approved in writing by the Contracting Officer for good cause 
shown), the Government shall have the right to cancel or ignore the 
markings at any time after said period and the data will no longer 
be made subject to any disclosure prohibitions.
    (iii) If the Recipient provides written justification to 
substantiate the propriety of the markings within the period set in 
subparagraph (e)(1)(i) of this clause, the Contracting Officer shall 
consider such written justification and determine whether or not the 
markings are to be cancelled or ignored. If the Contracting Officer 
determines that the markings are authorized, the Recipient shall be 
so notified in writing. If the Contracting Officer determines, with 
concurrence of the head of the contracting activity, that the 
markings are not authorized, the Contracting Officer shall furnish 
the Recipient a written determination, which determination shall 
become the final agency decision regarding the appropriateness of 
the markings unless the Recipient files suit in a court of competent 
jurisdiction within 90 days of receipt of the Contracting Officer's 
decision. The Government shall continue to abide by the markings 
under this subparagraph (e)(1)(iii) until final resolution of the 
matter either by the Contracting Officer's determination becoming 
final (in which instance the Government shall thereafter have the 
right to cancel or ignore the markings at any time and the data will 
no longer be made subject to any disclosure

[[Page 50666]]

prohibitions), or by final disposition of the matter by court 
decision if suit is filed.
    (2) The time limits in the procedures set forth in subparagraph 
(e)(1) of this clause may be modified in accordance with agency 
regulations implementing the Freedom of Information Act (5 U.S.C. 
552) if necessary to respond to a request thereunder.

(f) Omitted or Incorrect Markings

    (1) Data delivered to the Government without either the limited 
rights or restricted rights notice as authorized by paragraph (g) of 
this clause, or the copyright notice required by paragraph (c) of 
this clause, shall be deemed to have been furnished with unlimited 
rights, and the Government assumes no liability for the disclosure, 
use, or reproduction of such data. However, to the extent the data 
has not been disclosed without restriction outside the Government, 
the Recipient may request, within 6 months (or a longer time 
approved by the Contracting Officer for good cause shown) after 
delivery or such data, permission to have notices placed on 
qualifying data at the Recipient's expense, and the Contracting 
Officer may agree to do so if the Recipient:
    (i) Identifies the data to which the omitted notice is to be 
applied;
    (ii) Demonstrates that the omission of the notice was 
inadvertent;
    (iii) Establishes that the use of the proposed notice is 
authorized; and
    (iv) Acknowledges that the Government has no liability with 
respect to the disclosure, use, or reproduction of any such data 
made prior to the addition of the notice or resulting from the 
omission of the notice.
    (2) The Contracting Officer may also:
    (i) Permit correction at the Recipient's expense of incorrect 
notices if the Recipient identifies the data on which correction of 
the notice is to be made, and demonstrates that the correct notice 
is authorized, or
    (ii) Correct any incorrect notices.

(g) Protection of Limited Rights Data and Restricted Computer Software

    When data other than that listed in subparagraphs (b)(1)(i), 
(ii), and (iii) of this clause are specified to be delivered under 
this agreement and qualify as either limited rights data or 
restricted computer software, if the Recipient desires to continue 
protection of such data, the Recipient shall withhold such data and 
not furnish them to the Government under this agreement. As a 
condition to this withholding, the Recipient shall identify the data 
being withheld and furnish form, fit, and function data in lieu 
thereof. Limited rights data that are formatted as a computer data 
base for delivery to the Government are to be treated as limited 
rights data and not restricted computer software.

(h) Subaward/Contract

    The Recipient has the responsibility to obtain from its 
subrecipients/contractors all data and rights therein necessary to 
fulfill the Recipient's obligations to the Government under this 
agreement. If a subrecipient/contractor refuses to accept terms 
affording the Government such rights, the Recipient shall promptly 
bring such refusal to the attention of the Contracting Officer and 
not proceed with the subaward/contract award without further 
authorization.

(i) Additional Data Requirements

    In addition to the data specified elsewhere in this agreement to 
be delivered, the Contracting Officer may, at anytime during 
agreement performance or within a period of 3 years after acceptance 
of all items to be delivered under this agreement, order any data 
first produced or specifically used in the performance of this 
agreement. This clause is applicable to all data ordered under this 
subparagraph. Nothing contained in this subparagraph shall require 
the Recipient to deliver any data the withholding of which is 
authorized by this clause, or data which are specifically identified 
in this agreement as not subject to this clause. When data are to be 
delivered under this subparagraph, the Recipient will be compensated 
for converting the data into the prescribed form, for reproduction, 
and for delivery.
    (j) The recipient agrees, except as may be otherwise specified 
in this award for specific data items listed as not subject to this 
paragraph, that the Contracting Officer or an authorized 
representative may, up to three years after acceptance of all items 
to be delivered under this award, inspect at the Recipient's 
facility any data withheld pursuant to paragraph (g) of this clause, 
for purposes of verifying the Recipient's assertion pertaining to 
the limited rights or restricted rights status of the data or for 
evaluating work performance. Where the Recipient whose data are to 
be inspected demonstrates to the Contracting Officer that there 
would be a possible conflict of interest if the inspection were made 
by a particular representative, the Contracting Officer shall 
designate an alternate inspector.
    As prescribed in 600.325(d)(1), the following Alternate I and/or 
II may be inserted in the clause in the award instrument.

Alternate I:
    (g)(2) Notwithstanding subparagraph (g)(1) of this clause, the 
agreement may identify and specify the delivery of limited rights 
data, or the Contracting Officer may require by written request the 
delivery of limited rights data that has been withheld or would 
otherwise be withholdable. If delivery of such data is so required, 
the Recipient may affix the following ``Limited Rights Notice'' to 
the data and the Government will thereafter treat the data, in 
accordance with such Notice:

LIMITED RIGHTS NOTICE

    (a) These data are submitted with limited rights under 
Government agreement No. -------- (and subaward/contract No. ------
--, if appropriate). These data may be reproduced and used by the 
Government with the express limitation that they will not, without 
written permission of the Recipient, be used for purposes of 
manufacture nor disclosed outside the Government; except that the 
Government may disclose these data outside the Government for the 
following purposes, if any, provided that the Government makes such 
disclosure subject to prohibition against further use and 
disclosure:
    (1) Use (except for manufacture) by Federal support services 
contractors within the scope of their contracts;
    (2) This ``limited rights data'' may be disclosed for evaluation 
purposes under the restriction that the ``limited rights data'' be 
retained in confidence and not be further disclosed;
    (3) This ``limited rights data'' may be disclosed to other 
contractors participating in the Government's program of which this 
Recipient is a part for information or use (except for manufacture) 
in connection with the work performed under their awards and under 
the restriction that the ``limited rights data'' be retained in 
confidence and not be further disclosed;
    (4) This ``limited rights data'' may be used by the Government 
or others on its behalf for emergency repair or overhaul work under 
the restriction that the ``limited rights data'' be retained in 
confidence and not be further disclosed; and
    (5) Release to a foreign government, or instrumentality thereof, 
as the interests of the United States Government may require, for 
information or evaluation, or for emergency repair or overhaul work 
by such government. This Notice shall be marked on any reproduction 
of this data in whole or in part.
    (b) This Notice shall be marked on any reproduction of these 
data, in whole or in part.

(End of notice)

Alternate II:
    (g)(3)(i) Notwithstanding subparagraph (g)(1) of this clause, 
the agreement may identify and specify the delivery of restricted 
computer software, or the Contracting Officer may require by written 
request the delivery of restricted computer software that has been 
withheld or would otherwise be withholdable. If delivery of such 
computer software is so required, the Recipient may affix the 
following ``Restricted Rights Notice'' to the computer software and 
the Government will thereafter treat the computer software, subject 
to paragraphs (e) and (f) of this clause, in accordance with the 
Notice.

RESTRICTED RIGHTS NOTICE

    (a) This computer software is submitted with restricted rights 
under Government Agreement No. -------- (and subaward/contract ----
----, if appropriate). It may not be used, reproduced, or disclosed 
by the Government except as provided in paragraph (b) of this Notice 
or as otherwise expressly stated in the agreement.
    (b) This computer software may be--
    (1) Used or copies for use in or with the computer or computers 
for which it was acquired, including use at any Government 
installation to which such computer or computers may be transferred;
    (2) Used or copied for use in a backup computer if any computer 
for which it was acquired is inoperative;
    (3) Reproduced for safekeeping (archiv3es) or backup purposes;
    (4) Modified, adapted, or combined with other computer software, 
provided that the modified, combined, or adapted portions of the 
derivative software are made subject to the same restricted rights;
    (5) Disclosed to and reproduced for use by support service 
Recipients in accordance with subparagraph (b)(1) through (4) of 
this

[[Page 50667]]

clause, provided the Government makes such disclosure or 
reproduction subject to these restricted rights; and
    (6) Used or copied for use in or transferred to a replacement 
computer.
    (c) Notwithstanding the foregoing, if this computer software is 
published copyrighted computer software, it is licensed to the 
Government, without disclosure prohibitions, with the minimum rights 
set forth in paragraph (b) of this clause.
    (d) Any other rights or limitations regarding the use, 
duplication, or disclosure of this computer software are to be 
expressly stated, in, or incorporated in, the agreement.
    (e) This Notice shall be marked on any reproduction of this 
computer software, in whole or in part.

(End of notice)

    (ii) Where it is impractical to include the Restricted Rights 
Notice on restricted computer software, the following short-form 
Notice may be used in lieu thereof:

RESTRICTED RIGHTS NOTICE

    Use, reproduction, or disclosure is subject to restrictions set 
forth in agreement No. -------- (and subaward/contract --------, If 
appropriate) with -------- (name of Recipient and subrecipient/
contractor).

(End of notice)

    (iii) If restricted computer software is delivered with the 
copyright notice of 17 U.S.C. 401, it will be presumed to be 
published copyrighted computer software licensed to the government 
without disclosure prohibitions, with the minimum rights set forth 
in paragraph (b) of this clause, unless the Recipient includes the 
following statement with such copyright notice: ``Unpublished--
rights reserved under the Copyright Laws of the United States.''

(End of clause)

Rights in Data--Programs Covered Under Special Data Statutes

(a) Definitions

    Computer Data Bases, as used in this clause, means a collection 
of data in a form capable of, and for the purpose of, being stored 
in, processed, and operated on by a computer. The term does not 
include computer software.
    Computer software, as used in this clause, means (i) computer 
programs which are data comprising a series of instructions, rules, 
routines, or statements, regardless of the media in which recorded, 
that allow or cause a computer to perform a specific operation or 
series of operations and (ii) data comprising source code listings, 
design details, algorithms, processes, flow charts, formulae and 
related material that would enable the computer program to be 
produced, created or compiled. The term does not include computer 
data bases.
    Data, as used in this clause, means recorded information, 
regardless of form or the media on which it may be recorded. The 
term includes technical data and computer software. The term does 
not include information incidental to administration, such as 
financial, administrative, cost or pricing or management 
information.
    Form, fit, and function data, as used in this clause, means data 
relating to items, components, or processes that are sufficient to 
enable physical and functional interchangeability as well as data 
identifying source, size, configuration, mating and attachment 
characteristics, functional characteristics, and performance 
requirements except that for computer software it means data 
identifying source, functional characteristics, and performance 
requirements but specifically excludes the source code, algorithm, 
process, formulae, and flow charts of the software.
    Limited rights data, as used in this clause, means data (other 
than computer software) developed at private expense that embody 
trade secrets or are commercial or financial and confidential or 
privileged.
    Restricted computer software, as used in this clause, means 
computer software developed at private expense and that is a trade 
secret; is commercial or financial and confidential or privileged; 
or is published copyrighted computer software; including 
modifications of such computer software.
    Protected data, as used in this clause, means technical data or 
commercial or financial data first produced in the performance of 
the award which, if it had been obtained from and first produced by 
a non-federal party, would be a trade secret or commercial or 
financial information that is privileged or confidential under the 
meaning of 5 U.S.C. 552(b)(4) and which data is marked as being 
protected data by a party to the award.
    Protected rights, as used in this clause, mean the rights in 
protected data set forth in the Protected Rights Notice of paragraph 
(g) of this clause.
    Technical data, as used in this clause, means that data which 
are of a scientific or technical nature. Technical data does not 
include computer software, but does include manuals and 
instructional materials and technical data formatted as a computer 
data base.
    Unlimited rights, as used in this clause, means the right of the 
Government to use, disclose, reproduce, prepare derivative works, 
distribute copies to the public, and perform publicly and display 
publicly, in any manner and for any purpose whatsoever, and to have 
or permit others to do so.

(b) Allocation of Rights

    (1) Except as provided in paragraph (c) of this clause regarding 
copyright, the Government shall have unlimited rights in--
    (i) Data specifically identified in this agreement as data to be 
delivered without restriction;
    (ii) Form, fit, and function data delivered under this 
agreement;
    (iii) Data delivered under this agreement (except for restricted 
computer software) that constitute manuals or instructional and 
training material for installation, operation, or routine 
maintenance and repair of items, components, or processes delivered 
or furnished for use under this agreement; and
    (iv) All other data delivered under this agreement unless 
provided otherwise for protected data in accordance with paragraph 
(g) of this clause or for limited rights data or restricted computer 
software in accordance with paragraph (h) of this clause.
    (2) The Recipient shall have the right to--
    (i) Protect rights in protected data delivered under this 
agreement in the manner and to the extent provided in paragraph (g) 
of this clause;
    (ii) Withhold from delivery those data which are limited rights 
data or restricted computer software to the extent provided in 
paragraph (h) of this clause;
    (iii) Substantiate use of, add, or correct protected rights or 
copyrights notices and to take other appropriate action, in 
accordance with paragraph (e) of this clause; and
    (iv) Establish claim to copyright subsisting in data first 
produced in the performance of this agreement to the extent provided 
in subparagraph (c)(1) of this clause.

(c) Copyright

    (1) Data first produced in the performance of this agreement. 
Except as otherwise specifically provided in this agreement, the 
Recipient may establish, without the prior approval of the 
Contracting Officer, claim to copyright subsisting in any data first 
produced in the performance of this agreement. If claim to copyright 
is made, the Recipient shall affix the applicable copyright notice 
of 17 U.S.C. 401 or 402 and acknowledgment of Government sponsorship 
(including agreement number) to the data when such data are 
delivered to the Government, as well as when the data are published 
or deposited for registration as a published work in the U.S. 
Copyright Office. For such copyrighted data, including computer 
software, the Recipient grants to the Government, and others acting 
on its behalf, a paid-up nonexclusive, irrevocable, worldwide 
license to reproduce, prepare derivative works, distribute copies to 
the public, and perform publicly and display publicly, by or on 
behalf of the Government, for all such data.
    (2) Data not first produced in the performance of this 
agreement. The Recipient shall not, without prior written permission 
of the Contracting Officer, incorporate in data delivered under this 
agreement any data that are not first produced in the performance of 
this agreement and that contain the copyright notice of 17 U.S.C. 
401 or 402, unless the Recipient identifies such data and grants to 
the Government, or acquires on its behalf, a license of the same 
scope as set forth in subparagraph (c)(1) of this clause; provided, 
however, that if such data are computer software, the Government 
shall acquire a copyright license as set forth in subparagraph 
(h)(3) of this clause if included in this agreement or as otherwise 
may be provided in a collateral agreement incorporated or made a 
part of this agreeement.
    (3) Removal of copyright notices. The Government agrees not to 
remove any copyright notices placed on data pursuant to this 
paragraph (c), and to include such notices on all reproductions of 
the data.

(d) Release, Publication and Use of Data

    (1) The Receipt shall have the right to use, release to others, 
reproduce, distribute, or publish any data first produced or 
specifically used by the Recipient in the performance of this 
contract, except to the extent such data may be subject to the 
Federal export control or national security laws or regulations, or 
unless otherwise

[[Page 50668]]

provided in this paragraph of this clause or expressly set forth in 
this contract.
    (2) The Recipient agrees that to the extent it receives or is 
given access to data necessary for the performance of this agreement 
which contain restrictive markings, the Recipient shall treat the 
data in accordance with such markings unless otherwise specifically 
authorized in writing by the Contracting Officer.

(e) Unauthorized Marking of Data

    (1) Notwithstanding any other provisions of this agreement 
concerning inspection or acceptance, if any data delivered under 
this agreement are marked with the notices specified in subparagraph 
(g)(2) or (g)(3) of this clause and use of such is not authorized by 
this clause, or if such data bears any other restrictive or limiting 
markings not authorized by this agreement, the Contracting Officer 
may at any time either return the data to the Recipient or cancel or 
ignore the markings. However, the following procedures shall apply 
prior to canceling or ignoring the markings.
    (i) The Contracting Officer shall make written inquiry to the 
Recipient affording the Recipient 30 days from receipt of the 
inquiry to provide written justification to substantiate the 
propriety of the markings;
    (ii) If the Recipient fails to respond or fails to provide 
written justification to substantiate the propriety of the markings 
within the 30-day period (or a longer time not exceeding 90 days 
approved in writing by the Contracting Officer for good cause 
shown), the Government shall have the right to cancel or ignore the 
markings at any time after said period and the data will no longer 
be made subject to any disclosure prohibitions.
    (iii) If the Recipient provides written justification to 
substantiate the propriety of the markings within the period set in 
subdivision (e)(1)(i) of this clause, the Contracting Officer shall 
consider such written justification and determine whether or not the 
markings are to be cancelled or ignored. If the Contracting Officer 
determines that the markings are authorized, the Recipient shall be 
so notified in writing. If the Contracting Officer determines, with 
concurrence of the head of the contracting activity, that the 
markings are not authorized, the Contracting Officer shall furnish 
the Recipient a written determination, which determination shall 
become the final agency decision regarding the appropriateness of 
the markings unless the Recipient files suit in a court of competent 
jurisdiction within 90 days of receipt of the Contracting Officer's 
decision. The Government shall continue to abide by the markings 
under this subdivision (e)(1)(iii) until final resolution of the 
matter either by the Contracting Officer's determination become 
final (in which instance the Government shall thereafter have the 
right to cancel or ignore the markings at any time and the data will 
no longer be made subject to any disclosure prohibitions), or by 
final disposition of the matter by court decision if suit is filed.
    (2) The time limits in the procedures set forth in subparagraph 
(e)(1) of this clause may be modified in accordance with agency 
regulations implementing the Freedom of Information Act (5 U.S.C. 
552) if necessary to respond to a request thereunder.

(f) Omitted or Incorrect Markings

    (1) Data delivered to the Government without either the limited 
rights or restricted rights notice as authorized by paragraph (g) of 
this clause, or the copyright notice required by paragraph (c) of 
this clause, shall be deemed to have been furnished with unlimited 
rights, and the Government assumes no liability for the disclosure, 
use, or reproduction of such data. However, to the extent the data 
has not been disclosed without restriction outside the Government, 
the Recipient may request, within 6 months (or a longer time 
approved by the Contracting Officer for good cause shown) after 
delivery of such data, permission to have notices placed on 
qualifying data at the Recipient's expense, and the Contracting 
Officer may agree to do so if the Recipient--
    (i) Identifies the data to which the omitted notice is to be 
applied;
    (ii) Demonstrates that the omission of the notice was 
inadvertent;
    (iii) Establishes that the use of the proposed notice is 
authorized; and
    (iv) Acknowledges that the Government has no liability with 
respect to the disclosure, use, or reproduction of any such data 
made prior to the addition of the notice or resulting from the 
omission of the notice.
    (2) The Contracting Officer may also:
    (i) Permit correction at the Recipient's expense of incorrect 
notices if the Recipient identifies the data on which correction of 
the notice is to be made, and demonstrates that the correct notice 
is authorized; or
    (ii) Correct any incorrect notices.

(g) Rights to Protected Data

    (1) The Recipient may, with the concurrence of DOE, claim and 
mark as protected data, any data first produced in the performance 
of this award that would have been treated as a trade secret if 
developed at private expense. Any such claimed ``protected data'' 
will be clearly marked with the following Protected Rights Notice, 
and will be treated in accordance with such Notice, subject to the 
provisions of paragraphs (e) and (f) of this clause.

PROTECTED RIGHTS NOTICE

    These protected data were produced under agreement no. ------ 
with the U.S. Department of Energy and may not be published, 
disseminated, or disclosed to others outside the Government until 
(Note:) The period of protection of such data is fully negotiable, 
but cannot exceed the applicable statutorily authorized maximum), 
unless express written authorization is obtained from the recipient. 
Upon expiration of the period of protection set forth in this 
Notice, the Government shall have unlimited rights in this data. 
This Notice shall be marked on any reproduction of this data, in 
whole or in part.

(End of notice).

    (2) Any such marked Protected Data may be disclosed under 
obligations of confidentiality for the following purposes:
    (a) For evaluation purposes under the restriction that the 
``Protected Data'' be retained in confidence and not be further 
disclosed; or
    (b) To subcontractors or other team members performing work 
under the Government's (insert name of program or other applicable 
activity) program of which this award is a part, for information or 
use in connection with the work performed under their activity, and 
under the restriction that the Protected Data be retained in 
confidence and not be further disclosed.
    (3) The obligations of confidentiality and restrictions on 
publication and dissemination shall end for any Protected Data.
    (a) At the end of the protected period;
    (b) If the data becomes publicly known or available from other 
sources without a breach of the obligation of confidentiality with 
respect to the Protected Data;
    (c) If the same data is independently developed by someone who 
did not have access to the Protected Data and such data is made 
available without obligations of confidentiality; or
    (d) If the Recipient disseminates or authorizes another to 
disseminate such data without obligations of confidentiality.
    (4) However, the Recipient agrees that the following types of 
data are not considered to be protected and shall be provided to the 
Government when required by this award without any claim that the 
data are Protected Data. The parties agree that notwithstanding the 
following lists of types of data, nothing precludes the Government 
from seeking delivery of additional data in accordance with this 
award, or from making publicly available additional non-protected 
data, nor does the following list constitute any admission by the 
Government that technical data not on the list is Protected Data. 
(Note: It is expected that this paragraph will specify certain types 
of mutually agreed upon data that will be available to the public 
and will not be asserted by the recipient/contractor as limited 
rights or protected data).
    (5) The Government's sole obligation with respect to any 
protected data shall be as set forth in this paragraph (g).

(h) Protection of Limited Rights Data

    When data other than that listed in subparagraphs (b)(1)(i), 
(ii), and (iii) of this clause are specified to be delivered under 
this agreement and such data qualify as either limited rights data 
or restricted computer software, the Recipient, if the Recipient 
desires to continue protection of such data, shall withhold such 
data and not furnish them to the Government under this agreement. As 
a condition to this withholding the Recipient shall identify the 
data being withheld and furnish form, fit, and function data in lieu 
thereof.

(i) Subaward/Contract

    The Recipient has the responsibility to obtain from its 
subrecipients/contractors all data and rights therein necessary to 
fulfill the Recipient's obligations to the Government under this 
agreement. If a subrecipient/contractor refuses to accept terms 
affording the Government such rights, the Recipient shall promptly 
bring such refusal to the attention of the Contracting Officer and 
not proceed with subaward/contract award without further 
authorization.

[[Page 50669]]

(j) Additional Data Requirements

    In addition to the data specified elsewhere in this agreement to 
be delivered, the Contracting Officer may, at anytime during 
agreement performance or within a period of 3 years after acceptance 
of all items to be delivered under this agreement, order any data 
first produced or specifically used in the performance of this 
agreement. This clause is applicable to all data ordered under this 
subparagraph. Nothing contained in this subparagraph shall require 
the Recipient to deliver any data the withholding of which is 
authorized by this clause or data which are specifically identified 
in this agreement as not subject to this clause. When data are to be 
delivered under this subparagraph, the Recipient will be compensated 
for converting the data into the prescribed form, for reproduction, 
and for delivery.
    (k) The Recipient agrees, except as may be otherwise specified 
in this agreement for specific data items listed as not subject to 
this paragraph, that the Contracting Officer or an authorized 
representative may, up to three years after acceptance of all items 
to be delivered under this contract, inspect at the Recipient's 
facility any data withheld pursuant to paragraph (h) of this clause, 
for purposes of verifying the Recipient's assertion pertaining to 
the limited rights or restricted rights status of the data or for 
evaluating work performance. Where the Recipient whose data are to 
be inspected demonstrates to the Contracting Officer that there 
would be a possible conflict of interest if the inspection were made 
by a particular representative, the Contracting Officer shall 
designate an alternate inspector.
    As prescribed in 600.325(e)(2), the following Alternate I and/or 
II may be inserted in the clause in the award instrument.

Alternate I:
    (h)(2) Notwithstanding subparagraph (h)(1) of this clause, the 
agreement may identify and specify the delivery of limited rights 
data, or the Contracting Officer may require by written request the 
delivery of limited rights data that has been withheld or would 
otherwise be withholdable. If delivery of such data is so required, 
the Recipient may affix the following ``Limited Rights Notice'' to 
the data and the Government will thereafter treat the data, in 
accordance with such Notice:

LIMITED RIGHTS NOTICE

    (a) These data are submitted with limited rights under 
Government agreement No. -------- (and subaward/contract No. ------
--, if appropriate). These data may be reproduced and used by the 
Government with the express limitation that they will not, without 
written permission of the Recipient, be used for purposes of 
manufacture nor disclosed outside the Government; except that the 
Government may disclose these data outside the Government for the 
following purposes, if any, provided that the Government makes such 
disclosure subject to prohibition against further use and 
disclosure:
    (1) Use (except for manufacture) by Federal support services 
contractors within the scope of their contracts;
    (2) This ``limited rights data'' may be disclosed for evaluation 
purposes under the restriction that the ``limited rights data'' be 
retained in confidence and not be further disclosed;
    (3) This ``limited rights data'' may be disclosed to other 
contractors participating in the Government's program of which this 
Recipient is a part for information or use (except for manufacture) 
in connection with the work performed under their awards and under 
the restriction that the ``limited rights data'' be retained in 
confidence and not be further disclosed;
    (4) This ``limited rights data'' may be used by the Government 
or others on its behalf for emergency repair or overhaul work under 
the restriction that the ``limited rights data'' be retained in 
confidence and not be further disclosed; and
    (5) Release to a foreign government, or instrumentality thereof, 
as the interests of the United States Government may require, for 
information or evaluation, or for emergency repair or overhaul work 
by such government. This Notice shall be marked on any reproduction 
of this data in whole or in part.
    (b) This Notice shall be marked on any reproduction of these 
data, in whole or in part.

(End of notice)

Alternate II:
    (h)(3)(i) Notwithstanding subparagraph (h)(1) of this clause, 
the agreement may identify and specify the delivery of restricted 
computer software, or the Contracting Officer may require by written 
request the delivery of restricted computer software that has been 
withheld or would otherwise be withholdable. If delivery of such 
computer software is so required, the Recipient may affix the 
following ``Restricted Rights Notice'' to the computer software and 
the Government will thereafter treat the computer software, subject 
to paragraphs (d) and (e) of this clause, in accordance with the 
Notice:

RESTRICTED RIGHTS NOTICE

    (a) This computer software is submitted with restricted rights 
under Government Agreement No. -------- (and subaward/contract ----
----, if appropriate). It may not be used, reproduced, or disclosed 
by the Government except as provided in paragraph (c) of this Notice 
or as otherwise expressly stated in the agreement.
    (b) This computer software may be--
    (1) Used or copied for use in or with the computer or computers 
for which it was acquired, including use at any Government 
installation to which such computer or computers may be transferred;
    (2) Used or copies for use in a backup computer if any computer 
for which it was acquired is inoperative;
    (3) Reproduced for safekeeping (archives) or backup purposes;
    (4) Modified, adapted, or combined with other computer software, 
provided that the modified, combined, or adapted portions of the 
derivative software are made subject to the same restricted rights;
    (5) Disclosed to and reproduced for use by Federal support 
service Contractors in accordance with subparagraphs (b)(1) through 
(4) of this clause, provided the Government makes such disclosure or 
reproduction subject to these restricted rights; and
    (6) Used or copies for use in or transferred to a replacement 
computer.
    (c) Notwithstanding the foregoing, if this computer software is 
published copyrighted computer software, it is licensed to the 
Government, without disclosure prohibitions, with the minimum rights 
set forth in paragraph (b) of this clause.
    (d) Any other rights or limitations regarding the use, 
duplication, or disclosure of this computer software are to be 
expressly stated in, or incorporated in, the agreement.
    (e) This Notice shall be marked on any reproduction of this 
computer software, in whole or in part.

(End of notice)

    (ii) Where it is impractical to include the Restricted Rights 
Notice on restricted computer software, the following short-form 
Notice may be used in lieu thereof:

RESTRICTED RIGHTS NOTICE

    Use, reproduction, or disclosure is subject to restrictions set 
forth in Agreement No. -------- (and subaward/contract --------, if 
appropriate) with -------- (name of Recipient and subrecipient/
contractor).
(End of notice)

    (iii) If restricted computer software is delivered with the 
copyright notice of 17 U.S.C. 401, it will be presumed to be 
published copyrighted computer software licensed to the Government 
without disclosure prohibitions, with the minimum rights set forth 
in paragraph (b) of this clause, unless the Recipient includes the 
following statement with such copyright notice: ``Unpublished--
rights reserved under the Copyright Laws of the United States.''

(End of clause)

Appendix B to Subpart D to Part 600--Contract Provisions

    All contracts awarded by a recipient, including those for 
amounts less than the simplified acquisition threshold, must contain 
the following provisions as applicable:
    1. Equal Employment Opportunity--All contracts must contain a 
provision requiring compliance with E.O. 11246 (3 CFR, 1964-1965 
Comp., p. 339), ``Equal Employment Opportunity,'' as amended by E.O. 
11375 (3 CFR, 1966-1970 Comp., p. 684), ``Amending Executive Order 
11246 Relating to Equal Employment Opportunity,'' and as 
supplemented by regulations at 41 CFR chapter 60, ``Office of 
Federal Contract Compliance Programs, Equal Employment Opportunity, 
Department of Labor.''
    2. Copeland ``Anti-Kickback'' Act (18 U.S.C. 874 and 40 U.S.C. 
276c)--All contracts and subawards in excess of $2,000 for 
construction or repair awarded by recipients and subrecipients must 
include a provision for compliance with the Copeland ``Anti-
Kickback'' Act (18 U.S.C. 874), as supplemented by Department of 
Labor regulations (29 CFR part 3, ``Contractors and Subcontractors 
on Public Building or Public Work Financed in Whole or in Part by 
Loans

[[Page 50670]]

or Grants from the United States''). The Act provides that each 
contractor or subrecipient must be prohibited from inducing, by any 
means, any person employed in the construction, completion, or 
repair of public work, to give up any part of the compensation to 
which he is otherwise entitled. The recipient must report all 
suspected or reported violations to the responsible DOE contracting 
officer.
    3. Contact Work Hours and Safety Standards Act (40 U.S.C. 327-
333)--Where applicable, all contracts awarded by recipients in 
excess of $100,000 for construction and other purposes that involve 
the employment of mechanics or laborers must include a provision for 
compliance with Sections 102 and 107 of the Contract Work Hours and 
Safety Standards Act (40 U.S.C. 327-333), as supplemented by 
Department of Labor regulations (29 CFR part 5). Under Section 102 
of the Act, each contractor is required to compute the wages of 
every mechanic and laborer on the basis of a standard work week of 
40 hours. Work in excess of the standard work week is permissible 
provided that the worker is compensated at a rate of not less than 
1\1/2\ times the basic rate of pay for all hours worked in excess of 
40 hours in the work week. Section 107 of the Act is applicable to 
construction work and provides that no laborer or mechanic is 
required to work in surroundings or under working conditions which 
are unsanitary, hazardous or dangerous. These requirements do not 
apply to the purchases of supplies or materials or articles 
ordinarily available on the open market, or contracts for 
transportation or transmission of intelligence.
    4. Rights to Inventions and Data Made Under a Contract or 
Agreement--Contracts or agreements for the performance of 
experimental, development, or research work must provide for the 
rights of the Federal Government and the recipient in any resulting 
invention in accordance with 10 CFR 600.325 and Appendix A--Patent 
and Data Rights to Subpart D, Part 600.
    5. Clean Air Act (42 U.S.C. 7401 et seq.) and the Federal Water 
Pollution Control Act (33 U.S.C. 1251 et seq.), as amended--
Contracts and subawards of amounts in excess of $100,000 must 
contain a provision that requires the recipient to agree to comply 
with all applicable standards, orders or regulations issued pursuant 
to the Clean Air Act (41 U.S.C. 7401 et seq.) and the Federal Water 
Pollution control act as amended (33 U.S.C. 1251 et seq.). 
Violations must be reported to the responsible DOE contracting 
officer and the Regional Office of the Environmental Protection 
Agency (EPA).
    6. Byrd Anti-Lobbying Amendment (31 U.S.C. 1352)--Contractors 
who apply or bid for an award of $100,000 or more must file the 
required certification. Each tier certifies to the tier above that 
it will not and has not used Federal appropriated funds to pay any 
person or organization for influencing or attempting to influence an 
officer or employee of any agency, a member of Congress, officer or 
employee of Congress, or an employee of a member of Congress in 
connection with obtaining any Federal contract, grant or any other 
award covered by 31 U.S.C.1352. Each tier must also disclose any 
lobbing with non-Federal funds that takes place in connection with 
obtaining any Federal award. Such disclosures are forwarded from 
tier to tier up to the recipient.
    7.Debarment and Suspension (E.O.s 12549 and 12689--Contract 
awards that exceed the simplified acquisition threshold and certain 
other contract awards must not be made to parties listed on 
nonprocurement portion of the General Services Administration's 
Lists of Parties Excluded from Federal Procurement and 
Nonprocurement Programs in accordance with E.O.s 12549 (3 CFR, 1986 
Comp., p. 189) and 12689 (3 CFR, 1989 Comp., p. 235),``Debarment and 
Suspension.'' This list contains the names of parties debarred, 
suspended, or otherwise excluded by agencies, and contractors 
declared ineligible under statutory or regulatory authority other 
than E.O. 12549. Contractors with awards that exceed the small 
purchase threshold must provide the required certification regarding 
its exclusion status and that of its principals.
    8. Davis-Bacon Act (40 U.S.C. 276a)--As a general rule, it is 
unlikely that the Davis-Bacon Act, which among other things requires 
payment of prevailing wages on projects for the construction of 
public works, would apply to financial assistance awards. However, 
the presence of certain factors (e.g., requirement of particular 
program statues; title to a construction facility resting in the 
Government) might necessitate a closer analysis of the award, to 
determine if the Davis-Bacon Act would apply in the particular 
factual situation presented.
[FR Doc. 03-21172 Filed 8-20-03; 8:45 am]
BILLING CODE 6450-01-P