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.
    (ii) 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.  910.362  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 made to a For-Profit entity by 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., 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. 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''.
    (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.

Appendix A to Subpart D--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

1. 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 is defined in 2 CFR 200.70.
    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.
    (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 2 CFR 910.362(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 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)

2. 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 and 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, 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)

3. 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 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 paragraph (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 paragraph (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 paragraph (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 paragraph
(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
paragraph (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 paragraph (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 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 paragraph
(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 paragraphs (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 any time 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 2 CFR 910.362(d)(1), the following Alternate I
and/or II may be inserted in the clause in the award instrument.

Alternate I:

    (g)(2) Notwithstanding paragraph (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 paragraph (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
or 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 support service
Recipients in accordance with paragraph (b)(1) through (4) of this
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)

4. 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 paragraph (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 paragraph (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 paragraph (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 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 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 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 paragraph
(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 paragraph
(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 paragraphs (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.
    (j) Additional Data Requirements
    In addition to the data specified elsewhere in this agreement to
be delivered, the Contracting Officer may, at any time 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 2 CFR 910.362(e)(2), the following Alternate I
and/or II may be inserted in the clause in the award instrument.

Alternate I

    (h)(2) Notwithstanding paragraph (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 paragraph (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 paragraphs (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)

Subpart E--Cost Principles

Sec.  910.401  Application to M&O's.

    In accordance with 48 CFR 970.3002-1 and 970.3101-00-70, a
Federally Funded Research Center (FFRDC) which is also a designated DOE
Management and Operating (M&O) contract must follow the cost accounting
standards (CAS) contained in 48 CFR part 30 and must follow the
appropriate Cost Principles contained in 48 CFR part 31.

Subpart F--Audit Requirements for For-Profit Entities

General

Sec.  910.500  Purpose.

    This Part follows the same format as 2 CFR 200.500. We purposely
did not renumber the paragraphs within this part so that auditors and
recipients can compare this to the single audit requirements contained
in 2 CFR 200.500.

Audits

Sec.  910.501  Audit requirements.

    (a) Audit required. A for-profit entity that expends $750,000 or
more during the non-Federal entity's fiscal year in DOE awards must
have a compliance audit conducted for that year in accordance with the
provisions of this Part.
    (b) Compliance audit. (1) If a for-profit entity has one or more
DOE awards with expenditures of $750,000 or more during the for-profit
entity's fiscal year, they must have a compliance audit for each of the
awards with $750,000 or more in expenditures. The remaining awards do
not require, individually or in the aggregate, a compliance audit.
    (2) If a for-profit entity receives more than one award from DOE
with a sum total of expenditures of $750,000 or more, but does not have
any single award with expenditures of $750,000 or more; the entity must
determine whether any or all of the awards have common compliance
requirements (i.e., are considered a cluster of awards) and determine
the total expenditures of the awards with common compliance
requirements. A compliance audit is required for the largest cluster of
awards (if multiple clusters of awards exist) or the largest award not
in a cluster of awards, whichever corresponding expenditure total is
greater. The remaining awards do not require, individually or in the
aggregate, a compliance audit;
    (3) If a for-profit entity receives one or more awards from DOE
with a sum total of expenditures less than $750,000, no compliance
audit is required;
    (4) If the for-profit entity is a sub-recipient, 2 CFR 200.501(h)
requires that the pass-through entity establish appropriate monitoring
and controls to ensure the sub-recipient complies with award
requirements. These compliance audits must be conducted in accordance
with 2 CFR 200.514 Scope of audit
    (c) Program-specific audit election. Not applicable.
    (d) Exemption when Federal awards expended are less than $750,000.
A for-profit entity that expends less than $750,000 during the for-
profit's fiscal year in DOE awards is exempt from DOE audit
requirements for that year, except as noted in Sec.  910.503 Relation
to other audit requirements, but records must be available for review
or audit by appropriate officials of the Federal agency, pass-through
entity, and Government Accountability Office (GAO).
    (e) Federally Funded Research and Development Centers (FFRDC).
Management of an auditee that owns or operates a FFRDC may elect to
treat the FFRDC as a separate entity for purposes of this Part.
    (f) Subrecipients and Contractors. An auditee may simultaneously be
a recipient, a subrecipient, and a contractor. Federal awards expended
as a recipient are subject to audit under this Part. The payments
received for goods or services provided as a contractor are not Federal
awards. Section 2 CFR 200.330 Subrecipient and contractor
determinations should be considered in determining whether payments
constitute a Federal award or a payment for goods or services provided
as a contractor.
    (g) Compliance responsibility for contractors. In most cases, the
auditee's compliance responsibility for contractors is only to ensure
that the procurement, receipt, and payment for goods and services
comply with Federal statutes, regulations, and the terms and conditions
of Federal awards. Federal award compliance requirements normally do
not pass through to contractors. However, the auditee is responsible
for ensuring compliance for procurement transactions which are
structured such that the contractor is responsible for program
compliance or the contractor's records must be reviewed to determine
program compliance. Also, when these procurement transactions relate to
a major program, the scope of the audit must include determining
whether these transactions are in compliance with Federal statutes,
regulations, and the terms and conditions of Federal awards.
    (h) For-profit subrecipient. Since this Part does not apply to for-
profit subrecipients, the pass-through entity is responsible for
establishing requirements, as necessary, to ensure compliance by for-
profit subrecipients to DOE Federal award requirements. The agreement
with the for-profit subrecipient should describe applicable compliance
requirements and the for- profit subrecipient's compliance
responsibility. Methods to ensure compliance for Federal awards made to
for-profit subrecipients may include pre-award audits, monitoring
during the agreement, and post-award audits. See also 2 CFR 200.331
Requirements for pass- through entities.

Sec.  910.502  Basis for determining DOE awards expended.

    Determining DOE awards expended. The determination of when a DOE
award is expended should be based on when the activity related to the
DOE award occurs. Generally, the activity pertains to events that
require the non-Federal entity to comply with Federal statutes,
regulations, and the terms and conditions of DOE awards, such as:
expenditure/expense transactions associated with awards including
grants, cost-reimbursement contracts under the FAR, compacts with
Indian Tribes, cooperative agreements, and direct appropriations; the
disbursement

of funds to subrecipients; the use of loan proceeds under loan and loan
guarantee programs; the receipt of property; the receipt of surplus
property; the receipt or use of program income; the distribution or use
of food commodities; the disbursement of amounts entitling the for-
profit entity to an interest subsidy; and the period when insurance is
in force.
    (a) Loan and loan guarantees (loans). Loan and loan guarantees
issued by the DOE Loan Program Office corresponding to Title XVII of
the Energy Policy Act of 2005, as amended, 42 U.S.C. 16511-16516
(``Title XVII'') are exempt from these provisions.
    (1) Not applicable.
    (2) Not applicable.
    (3) Not applicable.
    (b) Not applicable.
    (c) Not applicable.
    (d) Endowment funds. The cumulative balance of DOE awards for
endowment funds that are federally restricted are considered DOE awards
expended in each audit period in which the funds are still restricted.
    (e) Free rent. Free rent received by itself is not considered a DOE
award expended under this Part. However, free rent received as part of
a DOE award to carry out a DOE program must be included in determining
DOE awards expended and subject to audit under this Part.
    (f) Valuing non-cash assistance. DOE non-cash assistance, such as
free rent, food commodities, donated property, or donated surplus
property, must be valued at fair market value at the time of receipt or
the assessed value provided by DOE.
    (g) Not applicable.
    (h) Not applicable.
    (i) Not applicable.

Sec.  910.503  Relation to other audit requirements.

    (a) An audit conducted in accordance with this Part must be in lieu
of any financial audit of DOE awards which a for-profit entity is
required to undergo under any other Federal statute or regulation. To
the extent that such audit provides DOE with the information it
requires to carry out its responsibilities under Federal statute or
regulation, DOE must rely upon and use that information.
    (b) Notwithstanding paragraph (a) of this section, DOE, Inspectors
General, or GAO may conduct or arrange for additional audits which are
necessary to carry out its responsibilities under Federal statute or
regulation. The provisions of this Part do not authorize any for-profit
entity to constrain, in any manner, DOE from carrying out or arranging
for such additional audits, except that DOE must plan such audits to
not be duplicative of other audits of DOE. Any additional audits must
be planned and performed in such a way as to build upon work performed,
including the audit documentation, sampling, and testing already
performed, by other auditors.
    (c) The provisions of this Part do not limit the authority of DOE
to conduct, or arrange for the conduct of, audits and evaluations of
DOE awards, nor limit the authority of any Federal agency Inspector
General or other Federal official.
    (d) DOE to pay for additional audits. If DOE conducts or arranges
for additional audits it must, consistent with other applicable Federal
statutes and regulations, arrange for funding the full cost of such
additional audits.
    (e) Not applicable.

Sec.  910.504  Frequency of audits.

    Audits required by this Part must be performed annually.
    (a) Not applicable.
    (b) Not applicable.

Sec.  910.505  Sanctions.

    In cases of continued inability or unwillingness to have an audit
conducted in accordance with this Part, DOE and pass-through entities
must take appropriate action as provided in 2 CFR 200.338 Remedies for
noncompliance.

Sec.  910.506  Audit costs.

    See 2 CFR 200.425 Audit services.

Sec.  910.507  Program-specific audits.

    (a) Program-specific audit guide available. In many cases, a
program-specific audit guide will be available to provide specific
guidance to the auditor with respect to internal controls, compliance
requirements, suggested audit procedures, and audit reporting
requirements. A listing of current program-specific audit guides can be
found in the compliance supplement beginning with the 2014 supplement
including Federal awarding agency contact information and a Web site
where a copy of the guide can be obtained. When a current program-
specific audit guide is available, the auditor must follow GAGAS and
the guide when performing a program-specific audit.
    (1) Program-specific audit guide not available. When a program-
specific audit guide is not available, the auditee and auditor must
conduct the compliance audit in accordance with GAAS and GAGAS.
    (2) If audited financial statements are available, for-profit
recipients should submit audited financial statements to DOE as a part
of the compliance audit. (If the recipient is a subsidiary for which
separate financial statements are not available, the recipient may
submit the financial statements of the consolidated group.)
    (3) The auditor must:
    (i) Not applicable.
    (ii) Obtain an understanding of internal controls and perform tests
of internal controls over the DOE program consistent with the
requirements of Sec.  910.514 Scope of audit.,
    (iii) Perform procedures to determine whether the auditee has
complied with Federal statutes, regulations, and the terms and
conditions of DOE awards that could have a direct and material effect
on the DOE program consistent with the requirements of Sec.  910.514
Scope of audit.
    (iv) Follow up on prior audit findings, perform procedures to
assess the reasonableness of the summary schedule of prior audit
findings prepared by the auditee in accordance with the requirements of
Sec.  910.511 Audit findings follow-up, and report, as a current year
audit finding, when the auditor concludes that the summary schedule of
prior audit findings materially misrepresents the status of any prior
audit finding; and
    (v) Report any audit findings consistent with the requirements of
Sec.  910.516 Audit findings.
    (4) The auditor's report(s) may be in the form of either combined
or separate reports and may be organized differently from the manner
presented in this section. The auditor's report(s) must state that the
audit was conducted in accordance with this Part and include the
following:
    (i) An opinion (or disclaimer of opinion) as to whether the
financial statement(s) (if available) of the DOE program is presented
fairly in all material respects in accordance with the stated
accounting policies;
    (ii) A report on internal control related to the DOE program, which
must describe the scope of testing of internal control and the results
of the tests;
    (iii) A report on compliance which includes an opinion (or
disclaimer of opinion) as to whether the auditee complied with laws,
regulations, and the terms and conditions of DOE awards which could
have a direct and material effect on the DOE program; and
    (iv) A schedule of findings and questioned costs for the DOE
program that includes a summary of the auditor's results relative to
the DOE program in a format consistent with Sec.  910.515 Audit
reporting, paragraph (d)(1) and findings and questioned costs
consistent with the

requirements of Sec.  910.515 Audit reporting, paragraph (d)(3).
    (5) Report submission for program-specific audits. The audit must
be completed and the reporting required by paragraph (c)(2) or (c)(3)
of this section submitted within the earlier of 30 calendar days after
receipt of the auditor's report(s), or nine months after the end of the
audit period, unless a different period is specified in a program-
specific audit guide. Unless restricted by Federal law or regulation,
the auditee must make report copies available for public inspection.
Auditees and auditors must ensure that their respective parts of the
reporting package do not include protected personally identifiable
information.
    (6) When a program-specific audit guide is available, the
compliance audits must be submitted (along with audited financial
statements if audited financial statements are available), to the
appropriate DOE Contracting Officer as well as to the DOE Office of the
Chief Financial Officer.
    (7) When a program-specific audit guide is not available, the
reporting package for a program-specific audit must consist of, a
summary schedule of prior audit findings, and a corrective action plan
as described in paragraph (b)(2) of this section, and the auditor's
report(s) described in paragraph (b)(4) of this section. The compliance
audit must be submitted (along with audited financial statements if
audited financial statements are available), to the appropriate DOE
Contracting Officer as well as to the DOE Office of the Chief Financial
Officer.
    (b) Other sections of this Part may apply. Program-specific audits
are subject to:
    (1) 910.500 Purpose through 910.503 Relation to other audit
requirements, paragraph (d);
    (2) 910.504 Frequency of audits through 910.506 Audit costs;
    (3) 910.508 Auditee responsibilities through 910.509 Auditor
selection;
    (4) 910.511 Audit findings follow-up;
    (5) 910.512 Report submission, paragraphs (e) through (h);
    (6) 910.513 Responsibilities;
    (7) 910.516 Audit findings through 910.517 Audit documentation;
    (8) 910.521 Management decision, and
    (9) Other referenced provisions of this Part unless contrary to the
provisions of this section, a program-specific audit guide, or program
statutes and regulations.

Auditees

Sec.  910.508  Auditee responsibilities.

    The auditee must:
    (a) Procure or otherwise arrange for the audit required by this
Part in accordance with Sec.  910.509 Auditor selection, and ensure it
is properly performed and submitted when due in accordance with Sec.
910.512 Report submission.
    (b) Submit appropriate financial statements (if available).
    (c) Submit the schedule of expenditures of DOE awards in accordance
with Sec.  910.510 Financial statements.
    (d) Promptly follow up and take corrective action on audit
findings, including preparation of a summary schedule of prior audit
findings and a corrective action plan in accordance with Sec.  910.511
Audit findings follow- up, paragraph (b) and Sec.  910.511 Audit
findings follow-up, paragraph (c), respectively.
    (e) Provide the auditor with access to personnel, accounts, books,
records, supporting documentation, and other information as needed for
the auditor to perform the audit required by this Part.

Sec.  910.509  Auditor selection.

    (a) Auditor procurement. When procuring audit services, the
objective is to obtain high-quality audits. In requesting proposals for
audit services, the objectives and scope of the audit must be made
clear and the for-profit entity must request a copy of the audit
organization's peer review report which the auditor is required to
provide under GAGAS. Factors to be considered in evaluating each
proposal for audit services include the responsiveness to the request
for proposal, relevant experience, availability of staff with
professional qualifications and technical abilities, the results of
peer and external quality control reviews, and price. Whenever
possible, the auditee must make positive efforts to utilize small
businesses, minority-owned firms, and women's business enterprises, in
procuring audit services as stated in 2 CFR 200.321 Contracting with
small and minority businesses, women's business enterprises, and labor
surplus area firms, or the FAR (48 CFR part 42), as applicable.
    (b) Restriction on auditor preparing indirect cost proposals. An
auditor who prepares the indirect cost proposal or cost allocation plan
may not also be selected to perform the audit required by this Part
when the indirect costs recovered by the auditee during the prior year
exceeded $1 million. This restriction applies to the base year used in
the preparation of the indirect cost proposal or cost allocation plan
and any subsequent years in which the resulting indirect cost agreement
or cost allocation plan is used to recover costs.
    (c) Use of Federal auditors. Federal auditors may perform all or
part of the work required under this Part if they comply fully with the
requirements of this Part.

Sec.  910.510  Financial statements.

    (a) Financial statements. If available, the auditee must submit
financial statements that reflect its financial position, results of
operations or changes in net assets, and, where appropriate, cash flows
for the fiscal year audited. The financial statements must be for the
same organizational unit and fiscal year that is chosen to meet the
requirements of this Part. However, for-profit entity-wide financial
statements may also include departments, agencies, and other
organizational units that have separate audits in accordance with Sec.
910.514 Scope of audit, paragraph (a) and prepare separate financial
statements.
    (b) Schedule of expenditures of DOE awards. The auditee must
prepare a schedule of expenditures of DOE awards for the period covered
by the auditee's fiscal year which must include the total DOE awards
expended as determined in accordance with Sec.  910.502 Basis for
determining DOE awards expended. While not required, the auditee may
choose to provide information requested by DOE and pass- through
entities to make the schedule easier to use. For example, when a DOE
program has multiple DOE award years, the auditee may list the amount
of DOE awards expended for each DOE award year separately. At a
minimum, the schedule must:
    (1) List individual DOE programs. For a cluster of programs,
provide the cluster name, list individual DOE programs within the
cluster of programs. For R&D, total DOE awards expended must be shown
by individual DOE award and major subdivision within DOE. For example,
the National Institutes of Health is a major subdivision in the
Department of Health and Human Services.
    (2) Not applicable.
    (3) Provide total DOE awards expended for each individual DOE
program and the CFDA number For a cluster of programs also provide the
total for the cluster.
    (4) Not applicable.
    (5) Not applicable.
    (6) Include notes that describe that significant accounting
policies used in preparing the schedule, and note whether or not the
for-profit entity elected to use the 10% de minimis cost

rate as covered in 2 CFR 200.414 Indirect (F&A) costs.

Sec.  910.511  Audit findings follow-up.

    (a) General. The auditee is responsible for follow-up and
corrective action on all audit findings. As part of this
responsibility, the auditee must prepare a summary schedule of prior
audit findings. The auditee must also prepare a corrective action plan
for current year audit findings. The summary schedule of prior audit
findings and the corrective action plan must include the reference
numbers the auditor assigns to audit findings under Sec.  910.516 Audit
findings, paragraph (c). Since the summary schedule may include audit
findings from multiple years, it must include the fiscal year in which
the finding initially occurred. The corrective action plan and summary
schedule of prior audit findings must include findings relating to the
financial statements which are required to be reported in accordance
with GAGAS.
    (b) Summary schedule of prior audit findings. The summary schedule
of prior audit findings must report the status of all audit findings
included in the prior audit's schedule of findings and questioned
costs. The summary schedule must also include audit findings reported
in the prior audit's summary schedule of prior audit findings except
audit findings listed as corrected in accordance with paragraph (b)(1)
of this section, or no longer valid or not warranting further action in
accordance with paragraph (b)(3) of this section.
    (1) When audit findings were fully corrected, the summary schedule
need only list the audit findings and state that corrective action was
taken.
    (2) When audit findings were not corrected or were only partially
corrected, the summary schedule must describe the reasons for the
finding's recurrence and planned corrective action, and any partial
corrective action taken. When corrective action taken is significantly
different from corrective action previously reported in a corrective
action plan or in DOE's or pass-through entity's management decision,
the summary schedule must provide an explanation.
    (3) When the auditee believes the audit findings are no longer
valid or do not warrant further action, the reasons for this position
must be described in the summary schedule. A valid reason for
considering an audit finding as not warranting further action is that
all of the following have occurred:
    (i) Two years have passed since the audit report in which the
finding occurred was submitted to DOE;
    (ii) DOE is not currently following up with the auditee on the
audit finding; and
    (iii) A management decision was not issued.
    (c) Corrective action plan. At the completion of the audit, the
auditee must prepare, in a document separate from the auditor's
findings described in Sec.  910.516 Audit findings, a corrective action
plan to address each audit finding included in the current year
auditor's reports. The corrective action plan must provide the name(s)
of the contact person(s) responsible for corrective action, the
corrective action planned, and the anticipated completion date. If the
auditee does not agree with the audit findings or believes corrective
action is not required, then the corrective action plan must include an
explanation and specific reasons.

Sec.  910.512  Report submission.

    (a) General. (1) The audit must be completed and the reporting
package described in paragraph (c) of this section must be submitted
within the earlier of 30 calendar days after receipt of the auditor's
report(s), or nine months after the end of the audit period. If the due
date falls on a Saturday, Sunday, or Federal holiday, the reporting
package is due the next business day.
    (2) Unless restricted by Federal statutes or regulations, the
auditee must make copies available for public inspection. Auditees and
auditors must ensure that their respective parts of the reporting
package do not include protected personally identifiable information.
    (b) Data collection. See paragraph (b)(1) of this section:
    (1) A senior level representative of the auditee (e.g., director of
finance, chief executive officer, or chief financial officer) must sign
a statement to be included as part of the reporting package that says
that the auditee complied with the requirements of this Part, the
reporting package does not include protected personally identifiable
information, and the information included in its entirety is accurate
and complete.
    (2) Not applicable.
    (3) Not applicable.
    (c) Reporting package. The reporting package must include the:
    (1) Financial statements (if available) and schedule of
expenditures of DOE awards discussed in Sec.  910.510 Financial
statements, paragraphs (a) and (b), respectively;
    (2) Summary schedule of prior audit findings discussed in Sec.
910.511 Audit findings follow-up, paragraph (b);
    (3) Auditor's report(s) discussed in Sec.  910.515 Audit reporting;
and
    (4) Corrective action plan discussed in Sec.  910.511 Audit
findings follow-up, paragraph (c).
    (d) Submission to DOE. The auditee must electronically submit the
compliance reporting package described in paragraph (c) of this section
compliance audits must be submitted (along with audited financial
statements if audited financial statements are available), to the
appropriate DOE Contracting Officer as well as to the DOE Office of the
Chief Financial Officer.
    (e) Requests for management letters issued by the auditor. In
response to requests by a Federal agency, auditees must submit a copy
of any management letters issued by the auditor.
    (f) Report retention requirements. Auditees must keep one copy of
the reporting package described in paragraph (c) of this section on
file for three years from the date of submission to DOE.
    (g) Not applicable.
    (h) Not applicable.

Federal Agencies

Sec.  910.513  Responsibilities.

    (a)(1) Not applicable.
    (2) Not applicable.
    (3) Not applicable.
    (i) Not applicable.
    (ii) Not applicable.
    (iii) Not applicable.
    (iv) Not applicable.
    (v) Not applicable.
    (vi) Not applicable.
    (vii) Not applicable.
    (viii) Not applicable.
    (ix) Not applicable.
    (b) Not applicable
    (1) Not applicable
    (2) Not applicable
    (c) DOE responsibilities. DOE must perform the following for the
awards it makes (See also the requirements of 2 CFR 200.210 Information
contained in a Federal award):
    (1) Ensure that audits are completed and reports are received in a
timely manner and in accordance with the requirements of this Part.
    (2) Provide technical advice and counsel to auditees and auditors
as requested.
    (3) Follow-up on audit findings to ensure that the recipient takes
appropriate and timely corrective action. As part of audit follow-up,
the DOE must:
    (i) Issue a management decision as prescribed in Sec.  910.521
Management decision;
    (ii) Monitor the recipient taking appropriate and timely corrective
action;

    (iii) Use cooperative audit resolution mechanisms (see 2 CFR 200.25
Cooperative audit resolution) to improve DOE program outcomes through
better audit resolution, follow-up, and corrective action; and
    (iv) Develop a baseline, metrics, and targets to track, over time,
the effectiveness of the DOE's process to follow-up on audit findings
and on the effectiveness of Compliance Audits in improving non-Federal
entity accountability and their use by DOE in making award decisions.
    (4) Not applicable.
    (5) Not applicable:
    (i) Not applicable
    (ii) Not applicable
    (6) Not applicable
    (7) Not applicable
    (i) Not applicable
    (ii) Not applicable.
    (iii) Not applicable.
    (iv) Not applicable
    (v) Not applicable
    (vi) Not applicable
    (vii) Not applicable.
    (viii) Not applicable

Auditors

Sec.  910.514  Scope of audit.

    (a) General. The audit must be conducted in accordance with GAGAS.
The audit must cover the entire operations of the auditee, or, at the
option of the auditee, such audit must include a series of audits that
cover departments, agencies, and other organizational units that
expended or otherwise administered DOE awards during such audit period,
provided that each such audit must encompass the schedule of
expenditures of DOE awards for each such department, agency, and other
organizational unit, which must be considered to be a for-profit
entity. The financial statements (if available) and schedule of
expenditures of DOE awards must be for the same audit period.
    (b) Financial statements. If financial statements are available,
the auditor must determine whether the schedule of expenditures of DOE
awards is stated fairly in all material respects in relation to the
auditee's financial statements as a whole.
    (1) Internal control. The compliance supplement provides guidance
on internal controls over Federal programs based upon the guidance in
Standards for Internal Control in the Federal Government issued by the
Comptroller General of the United States and the Internal Control--
Integrated Framework, issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO).
    (2) In addition to the requirements of GAGAS the auditor must
perform procedures to obtain an understanding of internal control over
DOE programs sufficient to plan the audit to support a low assessed
level of control risk of noncompliance for major programs.
    (3) Except as provided in paragraph (c)(4) of this section, the
auditor must:
    (i) Plan the testing of internal control over compliance to support
a low assessed level of control risk for the assertions relevant to the
compliance requirements.
    (ii) Perform testing of internal control as planned in paragraph
(c)(3)(i) of this section.
    (4) When internal control over some or all of the compliance
requirements are likely to be ineffective in preventing or detecting
noncompliance, the planning and performing of testing described in
paragraph (c)(3) of this section are not required for those compliance
requirements. However, the auditor must report a significant deficiency
or material weakness in accordance with Sec.  910.516 Audit findings,
assess the related control risk at the maximum, and consider whether
additional compliance tests are required because of ineffective
internal control.
    (5) Compliance. In addition to the requirements of GAGAS, the
auditor must determine whether the auditee has complied with Federal
statutes, regulations, and the terms and conditions of Federal awards
that may have a direct and material effect.
    (6) The principal compliance requirements applicable to most
Federal programs and the compliance requirements of the largest Federal
programs are included in the compliance supplement.
    (7) For the compliance requirements related to Federal programs
contained in the compliance supplement, an audit of these compliance
requirements will meet the requirements of this Part. Where there have
been changes to the compliance requirements and the changes are not
reflected in the compliance supplement, the auditor must determine the
current compliance requirements and modify the audit procedures
accordingly. For those Federal programs not covered in the compliance
supplement, the auditor should follow the compliance supplement's
guidance for programs not included in the supplement.
    (8) The compliance testing must include tests of transactions and
such other auditing procedures necessary to provide the auditor
sufficient appropriate audit evidence to support an opinion on
compliance.
    (c) Audit follow-up. The auditor must follow-up on prior audit
findings, perform procedures to assess the reasonableness of the
summary schedule of prior audit findings prepared by the auditee in
accordance with Sec.  910.511 Audit findings follow-up paragraph (b),
and report, as a current year audit finding, when the auditor concludes
that the summary schedule of prior audit findings materially
misrepresents the status of any prior audit finding. The auditor must
perform audit follow-up procedures.

Sec.  910.515  Audit reporting.

    The auditor's report(s) may be in the form of either combined or
separate reports and may be organized differently from the manner
presented in this section. The auditor's report(s) must state that the
audit was conducted in accordance with this Part and include the
following:
    (a) An opinion (or disclaimer of opinion) as to whether the
financial statements (if available) are presented fairly in all
material respects in accordance with generally accepted accounting
principles and an opinion (or disclaimer of opinion) as to whether the
schedule of expenditures of DOE awards is fairly stated in all material
respects in relation to the financial statements (if available) as a
whole.
    (b) A report on internal control over financial reporting and
compliance with Federal statutes, regulations, and the terms and
conditions of the DOE award, noncompliance with which could have a
material effect on the financial statements. This report must describe
the scope of testing of internal control and compliance and the results
of the tests, and, where applicable, it will refer to the separate
schedule of findings and questioned costs described in paragraph (d) of
this section.
    (c) A report on compliance and report and internal control over
compliance. This report must describe the scope of testing of internal
control over compliance, include an opinion or modified opinion as to
whether the auditee complied with Federal statutes, regulations, and
the terms and conditions of DOE awards which could have a direct and
material effect and refer to the separate schedule of findings and
questioned costs described in paragraph (d) of this section.
    (d) A schedule of findings and questioned costs which must include
the following three components:
    (1) A summary of the auditor's results, which must include:
    (i) The type of report the auditor issued (if applicable)on whether
the financial statements (if available)

audited were prepared in accordance with GAAP (i.e., unmodified
opinion, qualified opinion, adverse opinion, or disclaimer of opinion);
    (ii) Where applicable, a statement about whether significant
deficiencies or material weaknesses in internal control were disclosed
by the audit of the financial statements (if available);
    (iii) A statement (if applicable) as to whether the audit disclosed
any noncompliance that is material to the financial statements (if
available) of the auditee;
    (iv) Where applicable, a statement about whether significant
deficiencies or material weaknesses in internal control over major
programs were disclosed by the audit;
    (v) The type of report the auditor issued on compliance (i.e.,
unmodified opinion, qualified opinion, adverse opinion, or disclaimer
of opinion);
    (vi) A statement as to whether the audit disclosed any audit
findings that the auditor is required to report under Sec.  910.516
Audit findings paragraph (a);
    (vii) Not applicable.
    (viii) Not applicable.
    (ix) Not applicable.
    (2) Findings relating to the financial Statements (if available)
which are required to be reported in accordance with GAGAS.
    (i) Findings and questioned costs for DOE awards which must include
audit findings as defined in Sec.  910.516 Audit findings, paragraph
(a).Audit findings (e.g., internal control findings, compliance
findings, questioned costs, or fraud) that relate to the same issue
should be presented as a single audit finding.
    (ii) Audit findings that relate to both the financial statements
(if available) and DOE awards, as reported under paragraphs (d)(2) and
(d)(3) of this section, respectively, should be reported in both
sections of the schedule. However, the reporting in one section of the
schedule may be in summary form with a reference to a detailed
reporting in the other section of the schedule.
    (e) Nothing in this Part precludes combining of the audit reporting
required by this section with the reporting required by Sec.  910.512
Report submission, paragraph (b) Data Collection when allowed by GAGAS.

Sec.  910.516  Audit findings.

    (a) Audit findings reported. The auditor must report the following
as audit findings in a schedule of findings and questioned costs:
    (1) Significant deficiencies and material weaknesses in internal
control over major programs and significant instances of abuse relating
to major programs. The auditor's determination of whether a deficiency
in internal control is a significant deficiency or material weakness
for the purpose of reporting an audit finding is in relation to a type
of compliance requirement for a major program identified in the
Compliance Supplement.
    (2) Material noncompliance with the provisions of Federal statutes,
regulations, or the terms and conditions of DOE awards related to a
major program. The auditor's determination of whether a noncompliance
with the provisions of Federal statutes, regulations, or the terms and
conditions of DOE awards is material for the purpose of reporting an
audit finding is in relation to a type of compliance requirement for a
major program identified in the compliance supplement.
    (3) Known questioned costs that are greater than $25,000 for a type
of compliance requirement for a major program. Known questioned costs
are those specifically identified by the auditor. In evaluating the
effect of questioned costs on the opinion on compliance, the auditor
considers the best estimate of total costs questioned (likely
questioned costs), not just the questioned costs specifically
identified (known questioned costs). The auditor must also report known
questioned costs when likely questioned costs are greater than $25,000
for a type of compliance requirement for a major program. In reporting
questioned costs, the auditor must include information to provide
proper perspective for judging the prevalence and consequences of the
questioned costs.
    (4) Known questioned costs that are greater than $25,000 for a DOE
program. which is not audited as a major program. Except for audit
follow-up, the auditor is not required under this Part to perform audit
procedures for such a DOE program; therefore, the auditor will normally
not find questioned costs for a program that is not audited as a major
program. However, if the auditor does become aware of questioned costs
for a DOE program that is not audited as a major program (e.g., as part
of audit follow-up or other audit procedures) and the known questioned
costs are greater than $25,000, then the auditor must report this as an
audit finding.
    (5) Not applicable.
    (6) Known or likely fraud affecting a DOE award, unless such fraud
is otherwise reported as an audit finding in the schedule of findings
and questioned costs for DOE awards. This paragraph does not require
the auditor to report publicly information which could compromise
investigative or legal proceedings or to make an additional reporting
when the auditor confirms that the fraud was reported outside the
auditor's reports under the direct reporting requirements of GAGAS.
    (7) Instances where the results of audit follow-up procedures
disclosed that the summary schedule of prior audit findings prepared by
the auditee in accordance with Sec.  910.511 Audit findings follow-up,
paragraph (b) materially misrepresents the status of any prior audit
finding.
    (b) Audit finding detail and clarity. Audit findings must be
presented in sufficient detail and clarity for the auditee to prepare a
corrective action plan and take corrective action, and for DOE to
arrive at a management decision. The following specific information
must be included, as applicable, in audit findings:
    (1) Federal program and specific Federal award identification
including the CFDA title and number, and Federal award identification
number and year. When information, such as the CFDA title and number or
DOE award identification number, is not available, the auditor must
provide the best information available to describe the Federal award.
    (2) The criteria or specific requirement upon which the audit
finding is based, including the Federal statutes, regulations, or the
terms and conditions of the DOE awards. Criteria generally identify the
required or desired state or expectation with respect to the program or
operation. Criteria provide a context for evaluating evidence and
understanding findings.
    (3) The condition found, including facts that support the
deficiency identified in the audit finding.
    (4) A statement of cause that identifies the reason or explanation
for the condition or the factors responsible for the difference between
the situation that exists (condition) and the required or desired state
(criteria), which may also serve as a basis for recommendations for
corrective action.
    (5) The possible asserted effect to provide sufficient information
to the auditee and DOE to permit them to determine the cause and effect
to facilitate prompt and proper corrective action. A statement of the
effect or potential effect should provide a clear, logical link to
establish the impact or potential impact of the difference between the
condition and the criteria.
    (6) Identification of questioned costs and how they were computed.
Known questioned costs must be identified by applicable CFDA number(s)
and applicable DOE award identification number(s).