Subcontracts
FAR 27.304-3 ensures all subcontract tiers comply with intellectual property clause requirements and prohibits contractors from using subcontract awards to unfairly obtain invention rights.
Overview
FAR 27.304-3 outlines the requirements and policies regarding the inclusion of intellectual property and patent rights clauses in subcontracts under government contracts. It clarifies that the policies and procedures of this subpart apply to all subcontracts, regardless of tier. If a prime contractor or subcontractor believes a particular clause is inappropriate or if a subcontractor refuses to accept a clause, the contracting officer—after consulting with legal counsel—must resolve the issue. Additionally, the regulation prohibits contractors from using their subcontracting authority to gain economic leverage over subcontractors for the purpose of acquiring rights in inventions resulting from subcontracts. This ensures fair treatment and compliance with government policy on intellectual property rights in the subcontracting process.
Key Rules
- Applicability to All Subcontracts
- The policies and procedures apply to all subcontracts at any tier under a government contract.
- Disputes Over Clauses
- If a clause is considered inappropriate or is refused by a subcontractor, the contracting officer must resolve the matter with legal counsel.
- Prohibition on Economic Leverage
- Contractors cannot use subcontract awards to pressure subcontractors into giving up invention rights.
Responsibilities
- Contracting Officers: Must resolve disputes over clause inclusion in consultation with counsel.
- Contractors: Must apply required clauses to all subcontracts and avoid using subcontracting as leverage for invention rights.
- Agencies: Ensure oversight and compliance with these policies.
Practical Implications
- Ensures uniform application of intellectual property clauses in all subcontracts.
- Protects subcontractors from unfair practices regarding invention rights.
- Requires proactive resolution of disputes, preventing delays and legal issues.