[Federal Register Volume 88, Number 55 (Wednesday, March 22, 2023)]
[Rules and Regulations]
[Pages 17340-17345]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-05672]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 227, 237, 239, and 252

[Docket DARS-2019-0067]
RIN 0750-AK87


Defense Federal Acquisition Regulation Supplement: Noncommercial 
Computer Software (DFARS Case 2018-D018)

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Final rule.

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SUMMARY: DoD is issuing a final rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to implement a section of the 
National Defense Authorization Act for Fiscal Year 2018.

DATES: Effective March 22, 2023.

FOR FURTHER INFORMATION CONTACT: Mr. David E. Johnson, telephone 202-
913-5764.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD published a proposed rule in the Federal Register at 87 FR 4546 
on January 28, 2022, to implement section 871 of the National Defense 
Authorization Act (NDAA) for Fiscal Year (FY) 2018 (Pub. L. 115-91). 
Section 871 established new direction at 10 U.S.C. 4576 (formerly 10 
U.S.C. 2322a), Requirement for consideration of certain matters during 
acquisition of noncommercial computer software. The statute requires 
that DoD, as part of any negotiation for such software, consider all 
noncommercial computer software and related materials necessary to meet 
the needs of the agency throughout the life cycle of the software. This 
rule provides direction to DoD both to improve acquisition planning and 
to identify and negotiate for software deliverables and license rights 
at a fair and reasonable price before contract award. Eight respondents 
submitted public comments in response to the proposed rule. DoD also 
held a public meeting on March 10, 2022.

II. Discussion and Analysis

    DoD reviewed the public comments in the development of the final 
rule. A discussion of the comments and the changes made to the rule as 
a result of those comments is provided as follows:

A. Summary of Significant Changes From the Proposed Rule

    Based on comments received, DFARS 227.7203-2 and the clauses at 
DFARS 252.227-7014 and 252.227-7018 are revised as follows:
     DFARS 227.7203-2(c)(6)(ii)(A) and (B) and 227.7203-
2(c)(6)(iii) are revised to state ``license rights sufficient to meet 
the Government's needs'', rather than ``all necessary license rights.''
     The list of factors in DFARS 227.7203-2(b)(1)(ii) is 
revised to include the Government's costs to develop computer software.
     Paragraph (iii) of the definition of ``restricted rights'' 
in DFARS 252.227-7014 and 252.227-7018 is revised to remove the 
purposes added in the proposed rule and to permit the Government to 
make a reasonable number of copies of computer software required for 
the other purposes authorized under the clause.
     Paragraphs (v) through (vii) of the definition of the of 
``restricted rights'' in DFARS 252.227-7014 and 252.227-7018 are 
revised to expressly indicate that the Government has the right to use 
computer software and other rights to computer software already 
provided to covered Government support contractors.

B. Analysis of Public Comments

1. Areas of Alignment With Industry
    Comment: One of the respondents noted several areas of alignment 
between DoD and industry in the proposed rule, including: (1) removal 
of the definition of the term ``data''; (2) consideration of 
development at private expense; (3) consideration of alternatives to 
the formal delivery of source code and software design details; and (4) 
conformance of the DFARS definition of ``technical data'' to the 
statutory definition at 10 U.S.C. 3013 (formerly 10 U.S.C. 2302).
    Response: DoD acknowledges the respondent's comments.
2. Application to Commercial Computer Software
    Comment: Several respondents asserted that a plain language 
interpretation of 10 U.S.C. 4576 demonstrates that Congress intended 
for the provision to apply to only noncommercial computer software. 
Based on this interpretation, the respondents asserted that the 
proposed rule should not apply to commercial software, contrary to 
DoD's proposed revisions in DFARS 227.7202-1(d). The respondents also 
asserted that application of the proposed rule to commercial software 
is detrimental to the availability of commercial software, creates a 
barrier for nontraditional contractors, and is inconsistent with the 
commercial software industry's licensing models. Several respondents 
also asserted that the term ``all necessary license rights'' in DFARS 
227.7203-2(b)(6)(ii)(A) and (B) may be improperly applied to commercial 
software or misconstrued to mean a government purpose rights license or 
an unlimited rights license.
    Response: DoD acknowledges that 10 U.S.C. 4576 includes express 
references to noncommercial software and therefore must apply to 
noncommercial software. However, the statute does not prohibit the 
prescribed consideration of the Government's life-cycle needs from 
applying to negotiations for commercial software. Contrary to the 
respondents' interpretation, paragraph (a) of the statute directs the 
Government to consider the acquisition of ``all software'' and 
``related materials'' necessary to satisfy the Government's needs for 
certain activities throughout the life cycle of the noncommercial 
software being acquired, without any

[[Page 17341]]

limitations on commerciality of the additional software or related 
materials. Paragraph (b)(2) of 10 U.S.C. 4576 also indicates that the 
software deliverables should not rely on external or additional 
software with no limitations with respect to commerciality of that 
external or additional software. Similar to the respondents' comments 
about commercial software, paragraph (b) of the statute explicitly 
acknowledges circumstances where delivery of software is not feasible. 
In such cases, the statute and the final rule acknowledge alternative 
deliverable requirements. Accordingly, the statute may be applied to 
both noncommercial and commercial software, and the statute considers 
how DoD may consider and protect the intellectual property (IP) 
interests of its industry partners (including commercial vendors and 
nontraditional contractors).
    DoD asserts that application of the statutory requirements for the 
Government to consider acquiring all of the additional software and 
related materials necessary to meet the Government's needs for 
deploying, operating, testing, and supporting acquired software over 
its life cycle is consistent with long-standing policy regarding the 
acquisition of commercial software. DoD's established policies and 
practices for acquiring commercial computer software and related 
documentation recognize that the Government may negotiate for 
additional deliverables and license rights that are necessary to meet 
the Government's needs when the standard commercial deliverables or 
rights do not meet agency needs (see DFARS 227.7202-1(a) and (c) and 
227.7202-3(b)). For these reasons, DoD asserts that the final rule 
should apply to commercial software and documentation, while 
maintaining the policies set forth in DFARS 227.7202-1(c). The final 
rule has been revised to emphasize consistency with DFARS 227.7202-
1(c), while permitting contracting officers the discretion to consider 
the factors identified in DFARS 227.7203-2(b) and (c), unless 
inappropriate under the specific circumstances of the acquisition. 
Because the final rule is consistent with the policies at DFARS 
227.7202-1(c), this facilitates alignment with commercial licensing 
models, thereby incentivizing commercial vendors to do business with 
DoD.
    In response to the respondents' concerns about the scope of the 
term ``all necessary license rights'' in DFARS 227.7203-2(b)(6)(ii)(A) 
and (B), this phrase has been changed to ``license rights sufficient to 
meet the Government's needs.'' The final rule is consistent with the 
policies and directives at DFARS 227.7203 and Department of Defense 
Instruction (DoDI) 5010.44, Intellectual Property (IP) Acquisition and 
Licensing, which encourage contracting officers to tailor the 
Government's license rights to the meet agency needs.
3. Minimum Rights
    Comment: Several respondents recommended that the proposed rule 
should retain the term ``minimum'' in the phrase ``the Government's 
minimum needs'' in DFARS 227.7103-2(b)(1) and 227.7203-2(b)(1). The 
respondents asserted that removal of this term will be construed as 
expanding the scope of the Government's needs and encouraging an 
unbounded consideration of life-cycle needs. The respondents asserted 
that the Government may risk overpricing its requirements, based on an 
overly expansive interpretation of the proposed rule. The respondents 
also posited that an unbounded assessment of life-cycle needs may not 
consider obsolescence of software due to various factors, including 
future changes to hardware and software specifications, entrances and 
exits of software vendors to the market, and new disruptive 
technologies. One of the respondents also noted that the phrase ``the 
Government's minimum needs'' reflects long-standing DFARS policy, which 
was recommended by the Section 807 Committee in 1995.
    Response: DoD notes that the proposed revisions were made partially 
in response to recommendations made in Tension Point Paper 2 in the 
2018 Report Government-Industry Advisory Panel on Technical Data Rights 
(the ``Section 813 Panel Final Report''). In response to the advance 
notice of proposed rulemaking (ANPR) published at 85 FR 2101 on January 
14, 2020, one respondent previously recommended that DoD should adopt 
the recommendations in Tension Point Paper 2. In Tension Point Paper 2, 
the Government and industry panel members recommended that the term 
``minimum needs'' should be changed to ``lifecycle needs'' in the 
context of the Government determining its needs, including 
consideration of alternatives to traditional delivery methods.
    As acknowledged by respondents during the public meeting held on 
March 10, 2022, there are long-standing concerns that the phrase ``the 
Government's minimum needs'' and the term ``minimum'' in particular, 
are ambiguous and purportedly misunderstood by contracting officers. 
Accordingly, the final rule removes the source of the ambiguity by 
removing ``minimum needs'' and replacing it with ``life-cycle needs.'' 
In addition, the phrase ``the Government's life-cycle needs'' is 
aligned with the recitation of ``life cycle'' in 10 U.S.C. 4576, which 
does not reference ``minimum needs.'' The statute supersedes 
recommendations made by the Section 807 Committee nearly three decades 
ago.
    In response to the respondents' concerns about the scope of the 
term ``life-cycle needs,'' DoD notes that the assessment of life-cycle 
needs is informed and shaped by the considerations and factors in DFARS 
227.7103-2(b)(1) and 227.7203-2(b)(1). The final rule further bolsters 
the list of factors in DFARS 227.7203-2(b)(1)(i) by including the 
Government's costs to develop computer software.
4. Guidance on Procurement Planning and Solicitation/Contract 
Requirements
    Comment: One respondent expressed concerns that the proposed 
changes to DFARS 227.7202-1(d) and 227.7203-2(b) and (c) do not 
adequately address the complex state of software development across 
innovative, cloud-based technology firms. Another respondent asserted 
that the proposed rule disregards the value of the IP and investment of 
software developers. This respondent recommended that the final rule 
consider how acquisition requirements will impact the willingness of 
businesses (and specifically small businesses) to do business with the 
Government. The respondent suggested that DoD's assessments of life-
cycle needs should consider incentives for traditional and 
nontraditional contractors (such as small businesses) to continue to 
develop computer software solutions at private expense for Government 
applications and to submit bids for Government contracts.
    Another respondent recommended that the proposed rule at DFARS 
227.7203-2(b)(2)(ii) should be changed to require consideration of the 
alternatives to delivery of source code and related software design 
details listed in DFARS 227.7203-2(b)(2)(ii), rather than merely 
recommending consideration of alternatives. One respondent also 
recommended changing the title of this section to ``Alternatives to 
delivery of source code and related software design details.''
    Response: In accordance with 10 U.S.C. 3771 and DoDI 5010.44, the 
final rule was developed to respect and protect the IP interests and 
technology investment of industry (including small

[[Page 17342]]

businesses and nontraditional contractors), while considering DoD's 
investments and life-cycle needs. Accordingly, DoD adopted several of 
the respondents' recommendations. In particular, DFARS 227.7203-
2(b)(1)(i) was revised to emphasize the economic interests of small 
businesses and nontraditional contractors. The final rule also 
clarifies guidance in the proposed rule related to access to technical 
data or computer software. The final rule references ``access 
agreements for cloud-based or subscription-based software products or 
services'' as an alternative to delivery of source code and design 
details in DFARS 227.7203-2(b)(2)(ii). The final rule also changes the 
title of DFARS 227.7203-2(b)(2)(ii), as recommended.
    However, DoD has not adopted the respondent's recommendation to 
change the prescriptive guidance at DFARS 227.7203-2(b)(2)(ii) to 
require consideration of these alternatives to source code and related 
software design details. In accordance with FAR 2.101, the term 
``should'' denotes that the instruction will be followed unless 
inappropriate for a particular circumstance. As acknowledged by various 
respondents, DoD must consider the feasibility or practicality of 
applying these policies. To that end, the term ``should'' provides 
contracting officers with the flexibility to consider the specific 
circumstances or nuances of an acquisition in applying the 
considerations in DFARS 227.7203-2(b)(2)(ii).
5. Proposed Changes to Part 237
    Comment: Some respondents recommended that the proposed rule at 
DFARS 237.102 should not apply to service contracts, such as software-
as-a-service contracts.
    Response: DoDI 5000.74, Defense Acquisition of Services, indicates 
that IP needs must be addressed in acquisition strategies for service 
contracts. DoDI 5010.44 also indicates that acquisition, licensing, and 
management of IP is an important factor in acquisition, operation, 
maintenance, modernization, and sustainment, whether the IP is 
delivered as a product or as a service. In view of these DoD policies, 
the prescriptive guidance at DFARS 237.102 merely notes that 
contracting officers should consider the guidance in 227.7202 and 
227.7203, and references existing, long-standing DFARS guidance. For 
these reasons, DoD has not adopted the respondents' recommendation that 
the rule should not apply to service contracts.
6. ``Restricted Rights'' Definition
    Comment: Several respondents asserted that the revisions to the 
definition of ``restricted rights'' should be removed. The respondents 
asserted that the proposed revisions: (1) do not balance the interests 
of Government and industry; (2) conflict with existing DoD policies and 
statutes; and (3) are vague and internally inconsistent with respect to 
the terms ``reasonable'', ``development'', and ``use''. Several 
respondents indicated that the proposed rule does not adequately 
protect the developer's economic interests in software developed 
exclusively at private expense. Some respondents asserted that the 
proposed rule may impact the economic interests of small businesses and 
that it will discourage ongoing private investment and the delivery of 
privately developed software. The respondents also asserted that the 
proposed rule conflicts with existing DoD policies and statutes (e.g., 
the statutory preference for specially negotiated licenses and Small 
Business Innovation Research/Small Business Technology Transfer 
Programs policy objectives), and is not supported by 10 U.S.C. 3771 and 
3206.
    Response: DoD notes that the revisions to the ``restricted rights'' 
definition were made partially in response to recommendations made in 
Tension Point Paper 13 in the Section 813 Panel Final Report. In 
response to the ANPR published at 85 FR 2101 on January 14, 2020, one 
respondent previously recommended that DoD should adopt the 
recommendation in Tension Point Paper 13. In Tension Point Paper 13, 
industry panel members agreed that the definition of ``restricted 
rights'' should be revised to permit the Government to make a 
``reasonable'' number of copies to satisfy the Government's life-cycle 
needs, including DoD's programmatic and operational needs. Although the 
respondents indicated that the term ``reasonable'' is unbounded or 
vague, DoD notes that the current term ``minimum'' is also not limited 
or defined by a specific number of software copies. For these reasons, 
DoD has not adopted the respondents' recommendation to reinstate the 
phrase ``minimum number of copies.''
    The proposed rule changed the number of copies that the Government 
is permitted to make for otherwise-authorized activities. The proposed 
rule does not expand the Government's license rights to distribute or 
use computer software. Because there are no purpose-based limitations 
on the Government's use of computer programs in paragraph (i) of the 
``restricted rights'' definition, a ``restricted rights'' license 
permits Government use of computer programs for any purpose. 
Accordingly, the proposed rule included revisions that sought to 
reference and provide examples of the Government's authorized purposes 
and activities provided within the existing rights under the definition 
of ``restricted rights.''
    For clarity, DoD revised paragraph (iii) of these definitions by: 
(1) removing the additional listing of specific, exemplary purposes 
included in the proposed rule; (2) removing the reference to ``use'' of 
computer software; and (3) permitting copies for ``other activities 
authorized in [the `restricted rights' definition]'' to leverage 
existing rights under the clauses. The final rule also resolves an 
ambiguity in the ``restricted rights'' definition. Although the current 
rule expressly recognizes the Government's rights to use computer 
programs for any purpose in paragraph (i) of the definition, the rule 
only implicitly recognizes the Government's rights to use unmodified 
computer software for the specific purposes and activities for which 
the license expressly authorizes the software to be released to non-
Government persons. To resolve this ambiguity, DoD revised paragraphs 
(v) through (vii) to expressly indicate that the Government has the 
right to use computer software for those same purposes, as well as 
other rights to computer software already provided to covered 
Government support contractors.
7. Future Rulemaking Should Address Recommendations Presented by the 
2018 Government-Industry Advisory Panel on Technical Data Rights
    Comment: Although the respondent acknowledged that this 
recommendation is outside the scope of implementing 10 U.S.C. 4576, the 
respondent recommended that DoD's future rulemaking address the 
specific Government-industry recommendations included in Tension Point 
Paper 12 of the Section 813 Panel Final Report. In particular, the 
respondent recommended that DoD should, in a separate rule, consider 
DFARS revisions that identify factors to be considered in determining 
whether to adopt a traditional acquisition approach or a software-as-a-
service approach.
    Response: To the extent that such recommendations fall within the 
scope of implementation of 10 U.S.C. 4576 and existing DoD policies, 
DoD considered recommendations in the Section 813 Panel Final Report.

[[Page 17343]]

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold, for Commercial Services, and for Commercial Products, 
Including Commercially Available Off-the-Shelf Items

    This rule does not create any new solicitation provisions or 
contract clauses. It does not impact any existing provisions or clauses 
or their applicability to contracts valued at or below the simplified 
acquisition threshold, for commercial services, or for commercial 
products, including commercially available off-the-shelf items.

IV. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under section 6(b) of E.O. 12866, Regulatory Planning 
and Review, dated September 30, 1993.

V. Congressional Review Act

    As required by the Congressional Review Act (5 U.S.C. 801-808) 
before an interim or final rule takes effect, DoD will submit a copy of 
the interim or final rule with the form, Submission of Federal Rules 
Under the Congressional Review Act, to the U.S. Senate, the U.S. House 
of Representatives, and the Comptroller General of the United States. A 
major rule under the Congressional Review Act cannot take effect until 
60 days after it is published in the Federal Register. The Office of 
Information and Regulatory Affairs has determined that this rule is not 
a major rule as defined by 5 U.S.C. 804.

VI. Regulatory Flexibility Act

    A final regulatory flexibility analysis (FRFA) has been prepared 
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. 
The FRFA is summarized as follows:
    This rule implements section 871 of the National Defense 
Authorization Act (NDAA) for Fiscal Year (FY) 2018 (Pub. L. 115-91). 
Section 871 established new direction at 10 U.S.C. 2322a, Requirement 
for consideration of certain matters during acquisition of 
noncommercial computer software. The statute requires that DoD, as part 
of any negotiation for such software, consider all noncommercial 
computer software and related materials necessary to meet the needs of 
the agency.
    DoD received no public comments in response to the initial 
regulatory flexibility analysis.
    The rule may impact small entities that are awarded DoD contracts 
for noncommercial computer software, to include contracts under the 
Small Business Innovation Research and Small Business Technology 
Transfer Programs. Based on data from the Federal Procurement Data 
System (FPDS) and the Electronic Data Access (EDA) for FY 2019 through 
FY 2020, DoD estimates that an average of 6,263 unique small entities 
are awarded an average of 30,146 contract actions for noncommercial 
software annually.
    This rule does not impose any new reporting, recordkeeping, or 
other compliance requirements.
    There are no known alternatives that would accomplish the stated 
objectives of the applicable statute.

VII. Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) applies to this 
rule. However, these changes to the DFARS do not impose additional 
information collection requirements to the paperwork burden previously 
approved under Office of Management and Budget (OMB) Control Number 
0704-0369, entitled DFARS Subparts 227.71, Rights in Technical Data; 
and Subpart 227.72, Rights in Computer Software and Computer Software 
Documentation, and related provisions and clauses.

List of Subjects in 48 CFR Parts 227, 237, 239, and 252

    Government procurement.

Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.

    Therefore, 48 CFR parts 227, 237, 239, and 252 are amended as 
follows:

0
1. The authority citation for 48 CFR parts 227, 237, 239, and 252 
continues to read as follows:

    Authority:  41 U.S.C. 1303 and 48 CFR chapter 1.

PART 227--PATENTS, DATA, AND COPYRIGHTS

0
2. Revise the heading for subpart 227.71 to read as follows:

Subpart 227.71--Technical Data and Associated Rights

0
3. Amend section 227.7100--
0
a. In paragraph (a) introductory text by removing ``requirements in'';
0
b. By removing paragraph (a)(5);
0
c. By redesignating paragraphs (a)(6) through (9) as paragraphs (a)(5) 
through (8);
0
d. By revising the newly redesignated paragraphs (a)(7) and (8).
    The revisions read as follows:


227.7100   Scope of subpart.

* * * * *
    (a) * * *
    (7) Public Law 103-355.
    (8) Executive Order 12591 (subsection 1(b)(7)).
* * * * *

0
4. Amend section 227.7103-2 by revising paragraph (b)(1) to read as 
follows:


227.7103-2   Acquisition of technical data.

* * * * *
    (b)(1) Data managers or other requirements personnel are 
responsible for identifying the Government's life-cycle needs for 
technical data. Technical data needs must be established giving 
consideration to the offeror's economic interests in technical data 
pertaining to items, components, or processes that have been developed 
at private expense (including the economic interests of small 
businesses and nontraditional contractors); the Government's costs to 
acquire, maintain, store, retrieve, and protect the technical data; 
reprocurement needs; repair, maintenance, and overhaul philosophies; 
spare and repair part considerations; and whether procurement of the 
items, components, or processes can be accomplished on a form, fit, or 
function basis. When it is anticipated that the Government will obtain 
unlimited or government purpose rights in technical data that will be 
required for competitive spare or repair parts procurements, such data 
should be identified as deliverable technical data items. Reprocurement 
needs may not be a sufficient reason to acquire detailed manufacturing 
or process data when items or components can be acquired using 
performance specifications, form, fit, and function data, or when there 
are a sufficient number of alternate sources that can reasonably be 
expected to provide such items on a performance specification or form, 
fit, or function basis.
* * * * *

0
5. Revise the heading for subpart 227.72 to read as follows:

[[Page 17344]]

Subpart 227.72--Computer Software, Computer Software Documentation, 
and Associated Rights

0
6. Revise section 227.7200 to read as follows:


227.7200   Scope of subpart.

    (a) This subpart--
    (1) Prescribes policies and procedures for the acquisition of 
computer software and computer software documentation, and the rights 
to use, modify, reproduce, release, perform, display, or disclose such 
software or documentation. It implements the following laws and 
Executive order:
    (i) 10 U.S.C. 3013.
    (ii) 10 U.S.C. 3208(d).
    (iii) 10 U.S.C. 3771-3775.
    (iv) 10 U.S.C. 3781-3786.
    (v) 10 U.S.C. 4576.
    (vi) Executive Order 12591 (subsection 1(b)(7)).
    (2) Does not apply to--
    (i) Computer software or computer software documentation acquired 
under General Services Administration (GSA) schedule contracts; or
    (ii) Releases of computer software or computer software 
documentation to litigation support contractors (see subpart 204.74).
    (b) See PGI 227.7200(b) for guidance and information in DoD 
issuances.

0
7. Amend section 227.7202-1 by adding paragraph (d) to read as follows:


227.7202-1   Policy.

* * * * *
    (d) When establishing contract requirements and negotiation 
objectives to meet agency needs, the Government should consider the 
factors identified in 227.7203-2(b) and (c) for commercial computer 
software and computer software documentation, consistent with paragraph 
(c) of this section.

0
8. Amend section 227.7203-2--
0
a. By revising the section heading and paragraphs (b) and (c)(4) and 
(5); and
0
b. By adding paragraph (c)(6).
    The revisions and addition read as follows:


227.7203-2   Acquisition of other than commercial computer software and 
computer software documentation and associated rights.

* * * * *
    (b)(1) Data managers or other requirements personnel are 
responsible for identifying the Government's life-cycle needs for 
computer software and computer software documentation. See PGI 
227.7203-2(b) for further guidance on assessing life-cycle needs. In 
addition to desired software performance, compatibility, or other 
technical considerations, identification of life-cycle needs should 
consider such factors as--
    (i) The offeror's economic interests in software that has been 
developed at private expense (including the economic interests of small 
businesses and nontraditional contractors);
    (ii) The Government's costs to develop, acquire, maintain, store, 
retrieve, and protect the computer software and computer software 
documentation;
    (iii) Multiple site or shared use requirements;
    (iv) Whether the Government's software maintenance philosophy will 
require the right to modify or have third parties modify the software; 
and
    (v) Any special computer software documentation requirements.
    (2)(i) Procurement planning. To the maximum extent practicable, 
when assessing the life-cycle needs, data managers or other 
requirements personnel will address in the procurement planning and 
requirements documents (e.g., acquisition plans, purchase requests) the 
acquisition at appropriate times in the life cycle of all computer 
software, related recorded information, and associated license rights 
necessary to--
    (A) Reproduce, build, or recompile the software from its source 
code and required software libraries (e.g., software libraries called, 
invoked, or linked by the computer software source code that are 
necessary for the operation of the software);
    (B) Conduct required computer software testing and evaluation;
    (C) Integrate and deploy computer programs on relevant hardware 
including developmental, operational, diagnostic, training, or 
simulation environments; and
    (D) Sustain and support the software over its life cycle.
    (ii) Alternatives to delivery of source code and related software 
design details. The assessment of life-cycle needs should consider 
alternatives to the delivery of source code and related software design 
details for privately developed computer software as necessary to meet 
the Government's needs, such as--
    (A) Technical data and computer software sufficient to implement a 
modular open system approach or a similar approach (see PGI 227.7203-
2(b)(2)(ii)(A) for guidance on alternatives to source code and related 
software design details);
    (B) Access to technical data or computer software, including access 
agreements for cloud-based or subscription-based software products or 
services; see PGI 227.7203-2(b)(2)(ii)(B) and (C) for guidance on use 
of access agreements to contractor source code and related software 
design details;
    (C) Software support and maintenance provided directly from the 
contractor; or
    (D) Other contracting or licensing mechanisms including priced 
options, specially negotiated licenses, direct licensing between 
contractors for qualifying second sources, data escrow agreements, 
deferred delivery solutions, and subscription agreements. See PGI 
227.7203-2(b)(2)(ii)(D) for guidance on use of escrow agreements.
    (3) When reviewing offers received in response to a solicitation or 
other request for computer software or computer software documentation, 
data managers must balance the original assessment of the Government's 
needs with prices offered.
    (c) * * *
    (4) Include delivery schedules and acceptance criteria for each 
deliverable item;
    (5) Specifically identify the place of delivery for each 
deliverable item; and
    (6) Specify in the negotiated terms that any required other than 
commercial computer software, related recorded information, and 
associated license rights identified in the assessment of life-cycle 
needs in paragraph (b) of this section shall to the extent 
appropriate--
    (i) Include computer software delivered in a digital format 
compatible with applicable computer programs on relevant system 
hardware;
    (ii) Not rely on additional internal or external other than 
commercial or commercial technical data and software, unless such 
technical data or software is--
    (A) Included in the items to be delivered with license rights 
sufficient to meet the Government's needs; or
    (B) Commercially available with license rights sufficient to meet 
the Government's needs; and
    (iii) Include sufficient information, with license rights 
sufficient to meet the Government's needs, to support maintenance and 
understanding of interfaces and software version history when the 
negotiated terms do not allow for the inclusion of the external or 
additional other than commercial or commercial technical data and 
software.

PART 237--SERVICE CONTRACTS

0
9. Add section 237.102-76 to read as follows:


237.102-76   Acquisition of computer software and computer software 
documentation under services contracts.

    (a) See 227.7202 for policy on the acquisition of commercial 
computer

[[Page 17345]]

software and commercial computer software documentation for services 
contracts that require the development or modification of commercial 
computer software.
    (b) See 227.7203 for policy on the acquisition of other than 
commercial computer software and other than commercial computer 
software documentation for services contracts that require the 
development or modification of other than commercial computer software.

PART 239--ACQUISITION OF INFORMATION TECHNOLOGY

0
10. Amend section 239.101 by adding paragraph (4) to read as follows:


239.101   Policy.

* * * * *
    (4) See 227.7203 for policy on the acquisition of other than 
commercial computer software and other than commercial computer 
software documentation.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
11. Amend section 252.227-7013 by revising the clause date and 
paragraph (a)(15) to read as follows:


252.227-7013  Rights in Technical Data--Other than Commercial Products 
and Commercial Services.

* * * * *

Rights in Technical Data--Other Than Commercial Products or Commercial 
Services (Mar 2023)

    (a) * * *
    (15) Technical data means recorded information, regardless of 
the form or method of the recording, of a scientific or technical 
nature (including computer software documentation). The term does 
not include computer software or financial, administrative, cost or 
pricing, or management information, or information incidental to 
contract administration.
* * * * *

0
12. Amend section 252.227-7014--
0
a. By revising the clause date and paragraph (a)(15)(iii);
0
b. In paragraph (a)(15)(v) introductory text by removing ``Permit'' and 
``use'' and adding ``Use, and permit'' and ``use,'' in their places, 
respectively;
0
c. In paragraph (a)(15)(v)(A) by removing ``a release'' and adding 
``any such release'' in its place;
0
d. In paragraph (a)(15)(v)(B) by removing ``non-disclosure'' and adding 
``nondisclosure'' in its place;
0
e. In paragraph (a)(15)(vi) introductory text by removing ``Permit'', 
``use'', and ``the repairs'' and adding ``Use, and permit'', ``use,'', 
and ``the emergency repairs'' in their places, respectively; and
0
f. By revising paragraph (a)(15)(vii) introductory text.
    The revisions read as follows:


252.227-7014   Rights in Other Than Commercial Computer Software and 
Other Than Commercial Computer Software Documentation.

* * * * *

Rights in Other Than Commercial Computer Software and Other Than 
Commercial Computer Software Documentation (Mar 2023)

    (a) * * *
    (15) * * *
    (iii) Make a reasonable number of copies of the computer 
software required for the purposes of safekeeping (archive), backup, 
modification, or other activities authorized in paragraphs 
(a)(15)(i), (ii), and (iv) through (vii) of this clause;
* * * * *
    (vii) Use, modify, reproduce, perform, display, or release or 
disclose computer software to a person authorized to receive 
restricted rights computer software for management and oversight of 
a program or effort, and permit covered Government support 
contractors in the performance of covered Government support 
contracts that contain the clause at 252.227-7025, Limitations on 
the Use or Disclosure of Government-Furnished Information Marked 
with Restrictive Legends, to use, modify, reproduce, perform, 
display, or release or disclose the computer software to a person 
authorized to receive restricted rights computer software, provided 
that--
* * * * *

0
13. Amend section 252.227-7015 by revising the clause date and 
paragraph (a)(4) to read as follows:


252.227-7015   Technical Data--Commercial Products and Commercial 
Services.

* * * * *

Technical Data--Commercial Products and Commercial Services (Mar 2023)

    (a) * * *
    (4) Technical data means recorded information, regardless of the 
form or method of recording, of a scientific or technical nature 
(including computer software documentation). The term does not 
include computer software or financial, administrative, cost or 
pricing, or management information, or information incidental to 
contract administration.
* * * * *

0
14. Amend section 252.227-7018--
0
a. By revising the clause date and paragraph (a)(18)(iii);
0
b. In paragraph (a)(18)(v) introductory text by removing ``Permit'' and 
``use'' and adding ``Use, and permit'' and ``use,'' in their places, 
respectively;
0
c. In paragraph (a)(18)(v)(A) by removing ``a release'' and adding 
``any such release'' in its place;
0
d. In paragraph (a)(18)(v)(B) by removing ``non-disclosure'' and adding 
``nondisclosure'' in its place;
0
e. In paragraph (a)(18)(vi) introductory text by removing ``Permit'', 
``use'', and ``the repairs'' and adding ``Use, and permit'', ``use,'', 
and ``the emergency repairs'' in their places, respectively;
0
f. In paragraph (a)(18)(vi)(A) by removing ``non-disclosure'' and 
adding ``nondisclosure'' in its place; and
0
g. By revising paragraphs (a)(18)(vii) introductory text and (a)(20).
    The revisions read as follows:


252.227-7018   Rights in Other Than Commercial Technical Data and 
Computer Software--Small Business Innovation Research (SBIR) Program.

* * * * *

Rights in Other Than Commercial Technical Data and Computer Software--
Small Business Innovation Research (SBIR) Program (Mar 2023)

    (a) * * *
    (18) * * *
    (iii) Make a reasonable number of copies of the computer 
software required for the purposes of safekeeping (archive), backup, 
modification, or other activities authorized in paragraphs 
(a)(18)(i), (ii), and (iv) through (vii) of this clause;
* * * * *
    (vii) Use, modify, reproduce, perform, display, or release or 
disclose computer software to a person authorized to receive 
restricted rights computer software for management and oversight of 
a program or effort, and permit covered Government support 
contractors in the performance of covered Government support 
contracts that contain the clause at 252.227-7025, Limitations on 
the Use or Disclosure of Government-Furnished Information Marked 
with Restrictive Legends, to use, modify, reproduce, perform, 
display, or release or disclose the computer software to a person 
authorized to receive restricted rights computer software, provided 
that--
* * * * *
    (20) Technical data means recorded information, regardless of 
the form or method of the recording, of a scientific or technical 
nature (including computer software documentation). The term does 
not include computer software or financial, administrative, cost or 
pricing, or management information, or information incidental to 
contract administration.
* * * * *
[FR Doc. 2023-05672 Filed 3-21-23; 8:45 am]
BILLING CODE 5001-066-P