Rule on Support Contractor Access to Technical Data Finalized

The Department of Defense has finalized, with changes, the DFARS Case 2009-D031 interim rule ( ¶70,016.626) that amended the Defense Federal Acquisition Regulation Supplement to implement Section 821 of the National Defense Authorization Act for Fiscal Year 2010 (PL 111-84). Section 821 authorized certain types of support contractors to have access to proprietary technical data belonging to prime contractors and other third parties, and allowed the technical data owner to require the support contractor to execute a non-disclosure agreement with restrictions and remedies. Section 821 also authorized limited releases of otherwise proprietary data to certain contractors that directly support the government’s management and oversight of programs. The interim rule defined these contractors as “covered Government support contractors.” This definition, which tracks 10 USC 2320(f), appears in the clauses at DFARS 252.227-7013 through DFARS 252.227-7015 and DFARS 252.227-7018. The revised clauses cross-reference revised DFARS 252.227-7025, which contains the required non-disclosure restrictions. The interim rule also revised these clauses to incorporate specific additional requirements that support and implement Section 821. In addition, the rule added DFARS 209.505-4, which provides that CGSCs may be required to enter into NDAs directly with the third party asserting restrictions on limited rights technical data, commercial technical data, or restricted rights computer software. The interim rule also made corresponding changes to DFARS 209.403, DFARS 227.7102-2, DFARS 227.7103-5, and DFARS 252.212-7001.

Final Changes

In response to public comments DoD made several changes to the interim rule. Of significant note, the final rule revises DFARS 227.7104 (b) and the definition of “Small Business Innovation Research (SBIR) data rights” to clarify the government’s limited rights in technical data and restricted rights in computer software under the SBIR data rights license obtained under the clause at DFARS 252.227-7018. The rule also deletes the requirement for CGSCs to provide copies of NDAs with proprietary information owners to the contracting officer. This is not a statutory requirement and the benefit to the government in collecting these copies is outweighed by the administrative burden. In addition, the final rule adds a requirement at DFARS 252.227-7025 to explicitly require the contractor that receives the technical data to ensure that its employees are subject to use and non-disclosure obligations before the employees have access to or use of the proprietary information. Also, DoD added a requirement at DFARS 252.227-7025 (b)(5)(iii) to provide a 30-day period within which a CGSC must notify the contractor of the release or disclosure of the contractor’s limited rights data. Furthermore, the rule clarifies the definitions of “limited rights” and “restricted rights” in the relevant contract clauses to specify that the government’s authorized release to a CGSC is in the performance of a covered government support contract. Finally, the rule supplements existing organizational conflict of interest restrictions by adding layers of restriction, and additional safeguards, to ensure that any CGSC’s access to third-party proprietary data does not result in any competitive harm to the third-party data owner. For the text of the final rule, which is effective May 22, 2013, see ¶70,016.754.