[Federal Register Volume 88, Number 63 (Monday, April 3, 2023)]
[Notices]
[Pages 19704-19706]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-06870]
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SMALL BUSINESS ADMINISTRATION
RIN 3245-AI02
Small Business Innovation Research Program and Small Business
Technology Transfer Program Policy Directive
AGENCY: Small Business Administration.
ACTION: Notice of technical amendments; request for comments.
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SUMMARY: The Small Business Administration is amending the Small
Business Innovation Research (SBIR) and Small Business Technology
Transfer (STTR) programs Policy Directive to incorporate a template for
agencies participating in the SBIR or STTR programs (Participating
Agencies) to request the disclosure of statutorily required information
from SBIR or STTR applicants.
DATES: These revisions to the SBIR/STTR Policy Directive take effect on
May 3, 2023, without further action, unless significant adverse comment
is received by May 3, 2023. If significant adverse comment is received,
SBA will publish a timely withdrawal of the notice in the Federal
Register.
ADDRESSES: You may submit comments, identified by number SBA-XXX-XXXX,
through the Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
SBA will post all comments on www.regulations.gov. Please do not
submit confidential business information (CBI) as defined in the User
Notice at www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Erick Page-Littleford at (202) 718-
7738 or [email protected].
SUPPLEMENTARY INFORMATION:
I. Executive Summary
The mission of the Small Business Innovation Research (SBIR) and
Small Business Technology Transfer (STTR) programs is to engage small
business concerns (SBCs) to support scientific excellence and
technological innovation through the investment of Federal research and
research and development (R/R&D) funding in critical American
priorities to build a strong national economy. Both programs follow a
three-phase process throughout the Federal Government to solicit
proposals and award funding agreements for R/R&D: Phase I, Phase II,
and Phase III.
Section 9 of the Small Business Act (the Act), 15 United States
Code (U.S.C.) 638(j) and (p), requires that the Small Business
Administration (SBA) issue a policy directive setting forth guidance to
the Participating Agencies. The SBIR and STTR (SBIR/STTR) Policy
Directive outlines how agencies must generally conduct their programs.
Each Participating Agency, however, may tailor its program to meet the
needs of the individual Agency, as long as the general principles of
the program set forth in the Act and directive are followed. Therefore,
when incorporating SBIR/STTR policy into agency-specific regulations
and procedures, Participating Agencies may develop and apply processes
needed to implement the policy effectively; however, no Participating
Agency may develop and apply policies, directives, or clauses that
contradict, weaken, or conflict with the policy as stated in the Policy
Directive.
SBA reviews its SBIR/STTR Policy Directive regularly to determine
areas that need updating and further clarification. The SBIR and STTR
Extension Act of 2022 (Extension Act), Public Law 117-183 (Sep. 30,
2022), amended section 9 of the Act; 15 U.S.C. 638(g)(13)-(17),
(o)(17)-(21), and (vv), to require small businesses applying for SBIR
or STTR awards to disclose information about the applicant's investment
and foreign ties. SBA is amending Section 9(a) of the Policy Directive
and adding an appendix to address responsibilities of Participating
Agencies to collect disclosures of information about the applicant's
investment and foreign ties, as required by the Extension Act. This
amendment provides a common template, based on the statutory language
in the Act, to uniformly capture the required disclosures. This action
is designated a direct final rulemaking because SBA is adopting the
statutory language for the disclosure template questions with minor
clarifying edits.
II. Paperwork Reduction Act, 44 U.S.C., Ch. 35
SBA has determined that this direct final rule does not impose
additional reporting or recordkeeping requirements under the Paperwork
Reduction Act, 44 U.S.C., chapter 35. Sections 4(b)(2)(B) and 5(c) of
the Extension Act exclude the application of the Paperwork Reduction
Act to the collection of information related to the implementation of a
due diligence program authorized by 15 U.S.C. 638(vv). The collection
of information pursuant to the disclosure template is referenced in
section 15 U.S.C. 638(vv)(2)(A) and (B), is related to the
implementation of a due diligence program, and therefore is exempt from
the requirements of the Paperwork Reduction Act.
III. Amendment
Section 9--Responsibilities of SBIR/STTR Agencies and Departments
The Extension Act, Public Law 117-183 (Sep. 30, 2022), amended
section 9 of the Act; 15 U.S.C. 638 (g)(13)-(17), (o)(17)-(21), and
(vv) to require small businesses applying for SBIR or STTR awards to
disclose information about the applicant's investment and foreign ties.
This information must be provided by applicants for an SBIR or STTR
award and must be considered as part of each Participating Agency's
implementation of a due diligence program to assess security risks, as
required by section 4 of the Extension Act, and incorporated into the
Act at section 638(vv)(2). Sections 4(b)(2)(B) and 5(c) of the
Extension Act exclude the application of the Paperwork Reduction Act,
44 U.S.C. chapter 35, to the collection of information related to the
implementation of a due diligence program authorized by 15 U.S.C.
638(vv).
SBA is amending Section 9(a) of the Policy Directive and adding an
appendix to address the responsibilities of Participating Agencies to
collect
[[Page 19705]]
disclosures of certain information about the applicant's investment and
foreign ties, as required by the Extension Act. This amendment provides
a common template, based on the statutory language in the Act, to
uniformly capture required disclosures.
Some Participating Agencies are concerned about collecting the
disclosed information prior to publication of the disclosure template
in the Federal Register, subject to public comment, in accordance with
the requirements of 41 U.S.C. 1707(a). SBA is amending the Policy
Directive, as a final rulemaking, to address that concern and to ensure
that the disclosures may be collected without further delay. SBA is
following the process at 41 U.S.C. 1707(a)(2), to allow a 30-day
comment period prior to the effective date of this rulemaking. SBA
believes that it is a compelling circumstance to limit the comment
period to 30 days because section 4(b) of the Extension Act requires
Participating Agencies to implement a due diligence program that
considers the disclosed information within 270 days of the Extension
Act's passage on September 30, 2022. SBA intends to provide further
interpretive guidance on the disclosure template questions to
Participating Agencies.
Notice of the Disclosure Template in the Policy Directive for the Small
Business Innovation Research (SBIR) and Small Business Technology
Transfer (STTR) Programs
To: The SBIR and STTR Program Managers
Subject: SBIR/STTR Policy Directive
1. Purpose. The Small Business Administration (SBA) is updating its
Small Business Innovation Research and Small Business Technology
Transfer (SBIR/STTR) Policy Directives to include a disclosure template
for Participating Agencies to collect statutorily required information
from SBIR/STTR applicants.
2. Authority. The Small Business Act (15 U.S.C. 638(j) and (p))
requires the SBA Administrator to issue an SBIR and STTR program Policy
Directive for the general conduct of the programs. The Small Business
Act (15 U.S.C. 638(g)(13)-(17), (o)(17)-(21), and (vv)(2)) requires
that Participating Agencies collect disclosures of certain information
from SBIR and STTR applicants regarding investments and foreign ties,
as relates to the implementation of a due diligence program to assess
security risks.
3. Procurement Regulations. There are no procurement regulations
created though this action.
4. Personnel Concerned. This SBIR/STTR Policy Directive serves as
guidance for all Federal Government personnel who are involved in the
administration of the SBIR and STTR programs, issuance and management
of funding agreements or contracts pursuant to the programs, and/or the
establishment of goals for small business concerns in research or
research and development acquisition or grants.
5. Originator. SBA's Office of Investment and Innovation.
This amendment to the SBIR/STTR Policy Directive will be effective
on the date shown in the DATES section unless SBA receives any
significant adverse comments on or before the deadline for comments set
forth in the DATES section. Significant adverse comments are comments
that provide strong justifications why the clarifying amendment to the
Policy Directive should not be adopted as written or should be changed
further. SBA does not expect to receive any significant adverse
comments because the amendment adopts the statutory language regarding
the disclosures of information from SBIR/STTR applicants, as relates to
the implementation of a due diligence program. Implementation of this
change will benefit the public by ensuring that Participating Agencies
are using the same template to collect this information and will ensure
that Participating Agencies receive information that is useful for
determining whether there are security risks posed by particular SBIR
or STTR applicants. If SBA receives any significant adverse comments,
SBA will publish a notice in the Federal Register withdrawing this
notice before the effective date.
6. Date. Public comments on the proposed amendments to the Policy
Directive must be submitted within 30 days following publication in the
Federal Register.
Authorized By:
Dated: March 28, 2023.
Isabelle Casillas-Guzman,
Administrator.
List of Subjects
SBIR/STTR Policy Directive
1. Amend section 9(a)(5) by adding a new paragraph (13) after
paragraph (12).
The addition reads as follows:
9. Responsibilities of SBIR/STTR Agencies and Departments
(a) General Responsibilities. Each agency participating in the
SBIR/STTR program must:
(1) * * *
* * * * *
(13) Require disclosures from applicants utilizing the questions
provided in the template at Appendix III as a part of the agency due
diligence program to assess security risks under section 15 U.S.C.
638(vv). Agencies may require small business concerns to certify that
the information disclosed is accurate and complete.
2. Amend by adding Appendix III to the end of the SBIR/STTR Policy
Directive, as follows:
Appendix III: Required Disclosures of Foreign Affiliations or
Relationships to Foreign Countries
Relevant Definitions
Covered individual--the term ``covered individual'' means an
individual who--
(A) contributes in a substantive, meaningful way to the
scientific development or execution of a research and development
project proposed to be carried out with a research and development
award from a federal research agency; and
(B) is designated as a covered individual by the federal
research agency concerned.
Foreign affiliation--the term ``foreign affiliation'' means a
funded or unfunded academic, professional, or institutional
appointment or position with a foreign government or government-
owned entity, whether full-time, part-time, or voluntary. This
includes appointments or positions deemed adjunct, visiting, or
honorary with research institutions located in a foreign country of
concern.
Foreign country of concern--the term ``foreign country of
concern'' means the People's Republic of China, the Democratic
People's Republic of Korea, the Russian Federation, the Islamic
Republic of Iran, or any other country determined to be a country of
concern by the Secretary of State.
Malign foreign talent recruitment program--the term ``malign
foreign talent recruitment program'' has the meaning given such term
in section 19237 of title 42.
Federally funded award--the term ``federally funded award''
means a Phase I, Phase II (including a Phase II award under
subsection (cc)), or Phase III SBIR or STTR award made using a
funding agreement.
Applicant or awardee Name: ___
Applicant or awardee EIN (UEI if EIN is unavailable): ___
Responses to disclosure questions may contain trade secrets or
commercial or financial information that is privileged or
confidential and is exempt from public disclosure. Such information
shall be used or disclosed only for evaluation purposes or in
accordance with an award between the submitter and the Government.
An up-to-date list of countries determined to be countries of
concern by the Secretary of State will be maintained and accessible
on SBIR.gov.
[[Page 19706]]
Disclosure Questions
1. Is any owner or covered individual of the applicant or
awardee party to any malign foreign talent recruitment program?
[ballot] Yes [ballot] No
If yes, disclose the first and last name of each owner or
covered individual, identify their role (i.e., owner or covered
individual), and the malign foreign talent recruitment program.
2. Is there a parent company, joint venture, or subsidiary, of
the applicant or awardee that is based in or receives funding from,
any foreign country of concern?
[ballot] Yes [ballot] No
If yes, disclose the name, full address, applicant or awardee
relationships (i.e., parent company, joint venture, or subsidiary)
of each entity based in, or funded by, any foreign country of
concern.
3. Does the applicant or awardee have any current or pending
contractual or financial obligation or other agreement specific to a
business arrangement, or joint venture-like arrangement with an
enterprise owned by a foreign state or any foreign entity?
[ballot] Yes [ballot] No
If yes, disclose the name of each enterprise or foreign entity,
type of obligation, agreement, or arrangement (i.e., contractual,
financial, or other), description of obligation, agreement, or
arrangement, and the foreign state(s) and/or the country of the
foreign entity (or entities).
4. Is the applicant or awardee wholly owned in a foreign
country?
[ballot] Yes [ballot] No
If yes, disclose the foreign country.
5. Does the applicant or awardee have any venture capital or
institutional investment?
[ballot] Yes [ballot] No
If yes, proceed to question 5a. If no, proceed to question 6.
5a. Does the investing entity have a general partner or any
other individual holding a leadership role who has a foreign
affiliation with any foreign country of concern?
[ballot] Yes [ballot] No [ballot] Unable to determine
If yes or unable to determine, disclose the venture capital or
institutional investing entity's name, the percentage of ownership
obtained by the investing entity, and the type of investment (i.e.,
equity, debt, or combination of equity and debt).
6. During the previous 5-year period, did the applicant or
awardee have any technology licensing or intellectual property sales
or transfers, to a foreign country of concern?
[ballot] Yes [ballot] No
If yes, disclose the name, address, and country, of the
institution or entity that licensed, purchased, or received the
technology or intellectual property.
7. Is there any foreign business entity, offshore entity, or
entity outside the United States related to the applicant or
awardee?
[ballot] Yes [ballot] No
If yes, disclose the entity name, relationship type (i.e.,
foreign business entity, offshore entity, entity outside the United
States), description of the relationship to the applicant or
awardee, and entity address and country.
8. Does the applicant or awardee have an owner, officer, or
covered individual that has a foreign affiliation with a research
institution located in a foreign country of concern?
[ballot] Yes [ballot] No
If yes, disclose the first and last name of each owner, officer,
or covered individual that has a foreign affiliation with a foreign
country of concern, identify their role (i.e., owner, officer, or
covered individual), and the name of the foreign research
institution and the foreign country of concern where it is located.
[FR Doc. 2023-06870 Filed 3-31-23; 8:45 am]
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