FAR 27.303—Contract clauses.
Plain-English Summary
FAR 27.303 tells contracting officers when to include patent rights clauses in solicitations and contracts, and which clause or alternate to use based on the type of work, the contractor, and special legal or policy circumstances. It covers experimental, developmental, and research work; construction and architect-engineer services that include R&D, test and evaluation, or novel facility design; and the exclusion of standard construction from patent rights coverage. It also addresses the default clause at 52.227-11, Patent Rights—Ownership by the Contractor, the circumstances for using its alternates I through V, and when to modify the clause to require invention listings, closeout reports, patent application data, or inspection rights. In addition, it explains when to use a patent rights clause for interagency acquisitions, when agency procedures control for DoD, DOE, and NASA contracts with large businesses, and when the Government-ownership clause at 52.227-13 may be used because of foreign contractors, exceptional circumstances, national security, or certain DOE nuclear propulsion/weapons facilities. In practice, this section is about allocating invention ownership and reporting obligations up front so the Government protects its interests, contractors understand their rights, and agencies comply with Bayh-Dole and related patent policy requirements.
Key Rules
Patent clause required for R&D
Insert a patent rights clause in all solicitations and contracts for experimental, developmental, or research work. This is the baseline rule for work that may produce subject inventions.
Covers some construction and A-E work
The patent rights rules also apply to construction or architect-engineer contracts when the work includes R&D, test and evaluation studies, or design of a Government facility involving novel structures, machines, products, materials, processes, or equipment.
No clause for standard construction
Do not include a patent rights clause for construction or A-E services that involve only standard types of construction. Standard construction means previously developed methods and equipment, with only routine size, shape, capacity, or purely aesthetic variations.
Default clause is contractor ownership
Unless an alternate clause is required, use 52.227-11, Patent Rights—Ownership by the Contractor. This clause generally lets the contractor retain title to subject inventions, subject to disclosure and Government rights.
Reporting may be expanded
The contracting officer may add reporting requirements to 52.227-11, such as periodic invention listings, a final closeout report, patent application data, and an irrevocable inspection/copying right when a Government employee is a co-inventor, if that information is not already required elsewhere.
Use alternates for treaty or special facility needs
Use Alternate I when a treaty or executive agreement requires sublicensing to a foreign government; Alternate II for contracts affected by existing or future treaties or agreements; Alternate III for nonprofit operation of a Government-owned facility; Alternate IV for operation of a Government-owned facility; and Alternate V for services at certain Government laboratories supporting CRADAs, subject to exceptional-circumstances procedures.
Interagency and agency-specific procedures apply
If the solicitation or contract is placed on behalf of another agency, use the procedures in 27.304-2. For DoD, DOE, or NASA contracts with contractors other than small businesses or nonprofits, follow agency-specific patent rights procedures.
Government ownership clause in limited cases
After following the required procedures, the contracting officer may use 52.227-13, Patent Rights—Ownership by the Government, for foreign contractors, exceptional circumstances, foreign intelligence or counterintelligence needs, or certain DOE Government-owned, contractor-operated nuclear propulsion or weapons facilities.
Special rule for small business and nonprofits
If exceptional circumstances justify Government ownership for a small business or nonprofit, the contracting officer must still use 52.227-11 with only the modifications needed and must include greater-rights procedures equivalent to 52.227-13(b)(2).
Responsibilities
Contracting Officer
Determine whether the acquisition involves R&D, test and evaluation, novel facility design, or only standard construction; select the correct patent rights clause and alternate; add authorized reporting or inspection requirements; follow interagency, agency-specific, and exceptional-circumstances procedures; and ensure the clause matches the contractor type and legal basis for any Government ownership or foreign sublicensing.
Agency Head
Make required determinations for exceptional circumstances, including when restricting contractor title better promotes Bayh-Dole objectives or when foreign sublicensing is in the national interest. Approve use of special clause treatments where the regulation requires agency-head action.
Agency / Supplemental Regulation Authority
Issue any agency-specific patent rights procedures or supplemental clause requirements, especially for DoD, DOE, and NASA acquisitions, and for contracts where additional reporting or special treatment is needed.
Contractor
Disclose subject inventions, comply with patent rights reporting and closeout requirements, provide patent application information when required, and honor Government rights under the applicable clause and any treaty- or agreement-based sublicensing provisions.
Government Employee Co-Inventor / Government
When a Government employee is a co-inventor, the Government may require an irrevocable power to inspect and copy the patent application file; the Government also receives the rights and protections established by the selected patent rights clause.
Foreign Government or International Organization
Receive sublicenses only when a treaty, executive agreement, or properly modified alternate clause authorizes that result.
Practical Implications
The biggest day-to-day task is choosing the right clause early; using the wrong patent rights clause can create compliance problems, delay award, or undermine the Government’s rights in inventions.
Contractors should expect invention disclosure and patent reporting obligations even when they retain title under 52.227-11, and they should track subject inventions throughout performance and at closeout.
Contracting officers must distinguish true R&D or novel design work from standard construction; that distinction controls whether patent rights coverage is needed at all.
Special cases matter: foreign contractors, treaty-based projects, CRADA-related laboratory work, and DOE nuclear propulsion/weapons facilities can trigger different clause choices and extra approvals.
A common pitfall is assuming agency-specific rules are optional; for DoD, DOE, and NASA, and for interagency acquisitions, the regulation points to separate procedures that must be followed.
Official Regulatory Text
(a) (1) Insert a patent rights clause in all solicitations and contracts for experimental, developmental, or research work as prescribed in this section. (2) This section also applies to solicitations or contracts for construction work or architect-engineer services that include- (i) Experimental, developmental, or research work; (ii) Test and evaluation studies; or (iii) The design of a Government facility that may involve novel structures, machines, products, materials, processes, or equipment (including construction equipment). (3) The contracting officer shall not include a patent rights clause in solicitations or contracts for construction work or architect-engineer services that call for or can be expected to involve only "standard types of construction" "Standard types of construction" are those involving previously developed equipment, methods, and processes and in which the distinctive features include only- (i) Variations in size, shape, or capacity of conventional structures; or (ii) Purely artistic or aesthetic (as distinguished from functionally significant) architectural configurations and designs of both structural and nonstructural members or groupings, whether or not they qualify for design patent protection. (b) (1) Unless an alternative patent rights clause is used in accordance with paragraph (c), (d), or (e) of this section, insert the clause at 52.227-11 , Patent Rights-Ownership by the Contractor. (2) To the extent the information is not required elsewhere in the contract, and unless otherwise specified by agency supplemental regulations, the contracting officer may modify 52.227-11 (e) or otherwise supplement the clause to require the contractor to do one or more of the following: (i) Provide periodic (but not more frequently than annually) listings of all subject inventions required to be disclosed during the period covered by the report. (ii) Provide a report prior to the closeout of the contract listing all subject inventions or stating that there were none. (iii) Provide the filing date, serial number, title, patent number and issue date for any patent application filed on any subject invention in any country or, upon request, copies of any patent application so identified. (iv) Furnish the Government an irrevocable power to inspect and make copies of the patent application file when a Government employee is a co-inventor. (3) Use the clause with its Alternate I if the Government must grant a foreign government a sublicense in subject inventions pursuant to a specified treaty or executive agreement. The contracting officer may modify Alternate I, if the agency head determines, at contract award, that it would be in the national interest to sublicense foreign governments or international organizations pursuant to any existing or future treaty or agreement. When necessary to effectuate a treaty or agreement, Alternate I may be appropriately modified. (4) Use the clause with its Alternate II in contracts that may be affected by existing or future treaties or agreements. (5) Use the clause with its Alternate III in contracts with nonprofit organizations for the operation of a Government-owned facility. (6) If the contract is for the operation of a Government-owned facility, the contracting officer may use the clause with its Alternate IV. (7) If the contract is for the performance of services at a Government owned and operated laboratory or at a Government owned and contractor operated laboratory directed by the Government to fulfill the Government’s obligations under a Cooperative Research and Development Agreement (CRADA) authorized by 15 U.S.C. 3710a , the contracting officer may use the clause with its Alternate V. Since this provision is considered an exercise of an agency’s "exceptional circumstances" authority, the contracting officer must comply with 37 CFR 401.3(e) and 401.4. (c) Insert a patent rights clause in accordance with the procedures at 27.304-2 if the solicitation or contract is being placed on behalf of another Government agency. (d) Insert a patent rights clause in accordance with agency procedures if the solicitation or contract is for DoD, DOE, or NASA, and the contractor is other than a small business concern or nonprofit organization. (e) (1) Except as provided in paragraph (e)(2) of this section, and after compliance with the applicable procedures in 27.304-1 (b), the contracting officer may insert the clause at 52.227-13 , Patent Rights-Ownership by the Government, or a clause prescribed by agency supplemental regulations, if- (i) The contractor is not located in the United States or does not have a place of business located in the United States or is subject to the control of a foreign government; (ii) There are exceptional circumstances and the agency head determines that restriction or elimination of the right to retain title to any subject invention will better promote the policy and objectives of chapter 18 of title 35 of the United States Code; (iii) A Government authority that is authorized by statute or executive order to conduct foreign intelligence or counterintelligence activities, determines that restriction or elimination of the right to retain any subject invention is necessary to protect the security of such activities; or (iv) The contract includes the operation of a Government-owned, contractor-operated facility of DOE primarily dedicated to that Department’s naval nuclear propulsion or weapons related programs. (2) If an agency exercises the exceptions at paragraph (e)(1)(ii) or (iii) of this section in a contract with a small business concern or a nonprofit organization, the contracting officer shall use the clause at 52.227-11 with only those modifications necessary to address the exceptional circumstances and shall include in the modified clause greater rights determinations procedures equivalent to those at 52.227-13 (b)(2). (3) When using the clause at 52.227-13 , Patent Rights-Ownership by the Government, the contracting officer may supplement the clause to require the contractor to- (i) Furnish a copy of each subcontract containing a patent rights clause (but if a copy of a subcontract is furnished under another clause, a duplicate shall not be requested under the patent rights clause); (ii) Submit interim and final invention reports listing subject inventions and notifying the contracting officer of all subcontracts awarded for experimental, developmental, or research work; (iii) Provide the filing date, serial number, title, patent number, and issue date for any patent application filed on any subject invention in any country or, upon specific request, copies of any patent application so identified; and (iv) Submit periodic reports on the utilization of a subject invention. (4) Use the clause at 52.227-13 with its Alternate I if- (i) The Government must grant a foreign government a sublicense in subject inventions pursuant to a treaty or executive agreement; or (ii) The agency head determines, at contract award, that it would be in the national interest to sublicense foreign governments or international organizations pursuant to any existing or future treaty or agreement. If other rights are necessary to effectuate any treaty or agreement, Alternate I may be appropriately modified. (5) Use the clause at 52.227-13 with its Alternate II in the contract when necessary to effectuate an existing or future treaty or agreement.