FAR 35—Research and Development Contracting

Scope of part.

FAR 35.000 is the scope statement for FAR Part 35, and it tells readers what this part does and does not cover. It establishes that Part 35 contains policies and procedures that apply specifically to research and development (R&D) contracting, meaning contracts and acquisitions where the government is buying or supporting R&D work. It also draws two important boundaries: R&D that is integral to the acquisition of major systems is addressed under FAR Part 34, and independent research and development (IR&D) is addressed in the cost principle at FAR 31.205-18. In practice, this section helps contracting officers and contractors identify the correct regulatory framework before planning, pricing, administering, or charging R&D-related work. Its main purpose is to prevent misclassification and to direct users to the right part of the FAR for the type of R&D activity involved.

Definitions.

FAR 35.001 provides the core definitions used in the research and development (R&D) portion of the FAR, specifically defining applied research, development, and recoupment. These definitions matter because they determine how agencies and contractors classify technical work, which in turn affects cost allowability, contract structuring, funding decisions, and whether certain Government-funded costs may later be recovered. The section distinguishes applied research from development by focusing on the purpose of the effort: applied research seeks to exploit scientific discoveries and advance the state of the art, while development is the systematic use of scientific and technical knowledge to create or improve a product or service to meet specific performance requirements. It also clarifies that development includes design engineering, prototyping, and engineering testing, but excludes subcontracted technical effort used solely to create an additional source for an existing product. Finally, the section defines recoupment as the Government’s recovery of Government-funded nonrecurring costs when contractors later sell, lease, or license the resulting products or technology to non-Federal buyers. In practice, these definitions are important because they affect how contracting officers describe the work, how contractors charge and justify costs, and whether the Government may seek to recover certain investment costs later on.

General.

FAR 35.002 explains the basic policy for federal research and development (R&D) contracting. It covers the purpose of contracted R&D programs, the difference between R&D work and ordinary supplies or services contracts, the inherent uncertainty in defining R&D work and predicting technical success, and the need for the contracting process to attract the best scientific and industrial sources. It also emphasizes that R&D contracting should support an environment of reasonable flexibility and minimum administrative burden. In practice, this section tells contracting officers and contractors that R&D acquisitions are meant to advance knowledge and meet agency and national goals, but they must be managed differently from routine procurements because the work often cannot be fully specified in advance and may involve uncertain outcomes. The section is important because it justifies more adaptive acquisition approaches, careful source selection, and contract administration that avoids unnecessary rigidity while still protecting the Government’s interests.

Policy.

FAR 35.003 states the basic policy framework for using contracts in research and development (R&D) settings and for handling two related administrative issues: cost sharing and recoupment. It explains when the Government should use a contract versus a grant or cooperative agreement, focusing on the principal purpose of the transaction and whether the work is for the direct benefit or use of the Federal Government or instead to stimulate or support R&D for another public purpose. It also points readers to the rules that govern cost sharing under Government contracts, including the cross-references to FAR 16.303 and 42.707(a) plus agency procedures, and it addresses recoupment when it is not otherwise required by law. In practice, this section is important because it helps contracting officials choose the correct legal instrument at the outset, avoid misusing contracts for assistance-type purposes, and apply agency-specific policies consistently when cost sharing or recoupment issues arise. For contractors, it signals that cost-sharing commitments and any recoupment obligations are not free-form negotiations; they must fit within the FAR framework and the agency’s implementing procedures.

Publicizing requirements and expanding research and development sources.

FAR 35.004 explains how agencies should publicize research and development (R&D) requirements and broaden the pool of available R&D sources. It requires agencies, in addition to the normal synopsis and notice requirements in FAR part 5, to continually search for and develop information on capable R&D sources, including small business concerns. The section specifically calls for early identification and publication of agency R&D needs, cooperation among technical personnel, contracting officers, and Government small business personnel early in the acquisition process, and the provision of agency R&D points of contact for potential sources. It also points readers to subpart 9.7 on R&D pools and subpart 9.6 on teaming arrangements, showing that source development is not just about posting notices but also about building a broader, more connected R&D industrial base. In practice, this section is meant to help agencies find the best scientific and technical performers, encourage competition and innovation, and make it easier for new or smaller firms to enter the R&D market.

Work statement.

FAR 35.005 explains how to write an effective work statement for research and development acquisitions, with different expectations for basic research versus development and applied research. It emphasizes that the statement must be clear, complete, and tailored to the specific effort, while still leaving contractors enough freedom to use innovation and creativity. The section also distinguishes between work statements suited to a level-of-effort approach and those suited to a task-completion approach, and it requires the wording to match the intended contract type, including cost-reimbursement and fixed-price structures. Finally, it identifies the kinds of information technical and contracting personnel should consider including in the solicitation, such as the area of exploration, tasks, objectives, background information, constraints, reporting requirements, contract type, estimated effort, and any special considerations like design-to-cost requirements. In practice, this section helps the Government avoid overprescribing R&D work, reduce ambiguity, and align the solicitation with the nature of the research effort and the contract vehicle.

Contracting methods and contract type.

FAR 35.006 explains how contracting officers should choose the contracting method and contract type for research and development (R&D) acquisitions. It addresses why negotiation is usually necessary in R&D, the continuing need to follow FAR Part 6 competition requirements, and the contracting officer’s responsibility to select the contract type after considering technical advice. The section also explains why cost-reimbursement contracts are usually appropriate for R&D, when fixed-price arrangements may still work, and how incentive contracts fit into the decision. It further discusses short-duration fixed-price contracts for defined effort, minor projects with reliable cost estimates, and the normal progression from cost-reimbursement to fixed-price contracts as R&D matures into production. In practice, this section helps agencies match contract structure to technical uncertainty, cost risk, and development maturity so they avoid forcing an unsuitable contract type onto work that is still too uncertain to price accurately.

Solicitations.

FAR 35.007 explains how contracting officers should solicit research and development (R&D) requirements so the Government gets qualified, competitive, and well-understood proposals without wasting industry or Government resources. It covers initial distribution of solicitations to technically qualified sources, use of synopses and other publicizing methods, limiting the number of initial recipients when necessary, and furnishing solicitations to other apparently qualified sources in the interest of competition. It also addresses what R&D solicitations should require from offerors: descriptions of technical and management approach, identification and resolution of technical uncertainties, and disclosure of planned subcontracting of scientific or technical work. The section further covers proposal organization for efficient technical evaluation, evaluation factors for technical competence and other relevant criteria, treatment of cost/price, preproposal communication and conferences, permission to propose alternative contract types, discussions of independently developed ideas or products, and exploratory requests that do not create any Government obligation. In practice, this section is about targeting the right sources, asking the right questions, and structuring the solicitation so technical merit can be evaluated fairly and efficiently while preserving competition and avoiding unintended commitments.

Evaluation for award.

FAR 35.008 explains how agencies should evaluate offers for research and development (R&D) awards. It covers five main topics: selecting the organization with the best ideas or concepts and the highest competence in the relevant science or technology; avoiding awards for capabilities beyond what the work actually requires; carefully reviewing evaluation factors because R&D work usually cannot be specified with precision; using the Small Business Administration’s Certificate of Competency (COC) process when a small business is found nonresponsible; notifying and debriefing offerors under the Part 15 procedures; and evaluating proposed cost or price as both a reasonableness check and a source of insight into the offeror’s understanding of the project, risk perception, and management approach. In practice, this section reminds contracting officers that R&D source selection is more judgment-based than many other procurements and that the evaluation must be aligned to the actual research need, not to unnecessary technical excess. It also reinforces that cost/price analysis matters even when technical merit is the primary driver, because pricing can reveal whether the offeror truly understands the work. For contractors, the section signals that technical creativity, relevant competence, realistic pricing, and a clear grasp of project risk are all important to award decisions.

Subcontracting research and development effort.

FAR 35.009 addresses subcontracting of research and development (R&D) effort, with a special focus on technical and scientific work. The section explains why the Government cares about subcontracting in R&D: the original contractor is often selected for its unique scientific or technological capability, so the agency needs advance visibility into any plan to pass that work to others. It covers the contracting officer’s duty during negotiation of cost-reimbursement R&D contracts to obtain complete information about proposed subcontracting of experimental, research, or development effort, and it also addresses fixed-price R&D contracts, where the contracting officer should evaluate subcontracting plans and may negotiate protections for the Government’s interests. The section ties into FAR 35.007(c) and the subcontract approval requirements in the Subcontracts clause at FAR 52.244-2, as prescribed by FAR 44.204(a). In practice, this means subcontracting in R&D is not just a routine purchasing decision; it can affect the basis on which the contractor was selected, the quality of the technical work, and the Government’s ability to control performance and protect sensitive or mission-critical research.

Scientific and technical reports.

FAR 35.010 addresses scientific and technical reporting requirements for research and development (R&D) contracts. It requires contractors to provide scientific and technical reports that serve as a permanent record of the work performed, and it ties those reports to the objectives of the specific R&D effort. The section also directs agencies to make R&D results available to other Government activities and the private sector, while recognizing that disclosure must be managed in accordance with agency rules on national security, data protection, and technology dissemination. In practice, this means contracting officers must build appropriate reporting requirements into R&D contracts, ensure reports are routed as required, and apply any agency-specific controls on release or distribution. The section also identifies the National Technical Information Service (NTIS) as a destination for reports and notes that, when required, completed reports should include Standard Form 298, Report Documentation Page. Overall, this provision is about preserving the technical record of federally funded research while promoting appropriate dissemination and safeguarding sensitive information.

Data.

FAR 35.011 addresses a practical but important issue in research and development contracting: what data must be delivered, and how to plan for later production competition. It makes clear that R&D contracts must specifically identify the technical data to be delivered, because the standard data rights clauses in FAR part 27 do not themselves require delivery of technical data. The section also tells agencies to think ahead when a developmental program may lead to production contracts, including whether they will need a technical package made up of plans, drawings, specifications, and other descriptive information. That planning matters because a complete technical package can be essential to obtaining effective competition in follow-on production. The section further recognizes that, in some cases, the developmental contractor may be the best source to prepare that package, which has implications for acquisition planning, data deliverables, and later source selection strategy.

Patent rights.

FAR 35.012 is a cross-reference provision, not a substantive patent-rights rule. It tells readers that patent rights issues in research and development contracting are governed by agency-specific regulations and FAR part 27, which covers patents, data, and copyrights. In practice, this section signals that you cannot determine patent ownership, contractor reporting obligations, government license rights, or invention disclosure procedures from FAR part 35 alone; you must look to the applicable agency supplement and the detailed patent-rights clauses and policies in part 27. Its purpose is to prevent duplication in the FAR and to direct contracting officers, contractors, and researchers to the controlling authorities for inventions, subject inventions, licenses, and related intellectual property matters arising under R&D work. For federal contracting, the practical significance is that patent-rights terms may vary by agency and contract type, and they must be handled under the correct regulatory framework rather than assumed from the research and development part of the FAR.

Insurance.

FAR 35.013 addresses a narrow but important insurance issue in research and other cost-reimbursement contracting with nonprofit, educational, and State institutions. It explains that these organizations often do not carry commercial insurance because they may claim immunity from tort liability or, in the case of State institutions, may be legally barred from spending funds on insurance. The section does not itself prescribe a standalone insurance clause; instead, it directs the reader to FAR 28.311 for the appropriate clause coverage when these circumstances exist. In practice, this means the contracting officer must recognize that standard insurance assumptions may not fit these performers and must ensure the contract includes the right liability and insurance-related terms. The section is significant because it helps avoid inserting inappropriate insurance requirements that the contractor cannot lawfully or practically meet, while still protecting the Government through the correct contractual clause structure.

Government property and title.

FAR 35.014 explains how title to Government-funded equipment and other tangible personal property is handled in research and development contracts, especially basic and applied scientific research performed by nonprofit institutions of higher education and nonprofit research organizations. It ties those contracts to the Government property control requirements in FAR part 45, so agencies and contractors must still establish and maintain proper property records, accountability, and control. The section then sets out special title rules for equipment purchased with Government funds, including when title may automatically vest in the contractor, when title may vest in the Government, when the Government may later direct transfer of title, and when title need not be transferred because the equipment is still needed at a Government installation. It also addresses the effect of missing title agreements, the prohibition on charging depreciation, amortization, or use charges when title is vested in the contractor, and the civil rights condition that applies before title is vested. In practice, this section matters because it determines who owns expensive research equipment, who bears the risk and administrative burden of tracking it, and whether the contractor can recover costs through future contracts. It also ensures that property disposition decisions support the agency’s research mission while complying with statutory authority and nondiscrimination requirements.

Contracts for research with educational institutions and nonprofit organizations.

FAR 35.015 addresses how the Government should structure research and development contracts with educational institutions and nonprofit organizations when the work is not precisely defined and the contract is based on a period of performance rather than a fixed deliverable date. It explains when the contractor, rather than the Government, should have primary responsibility for the research, and it requires special contract terms about the principal investigator or project leader, that person’s expected level of effort, continuous involvement, and the need for contracting officer approval before changing key research elements. The section also covers when these same controls may be added even in contracts with precise objectives or a specific completion date, if Government oversight of approach, methods, or schedule is needed. In addition, it addresses basic agreements for recurring research contracting with these organizations, including when they should be negotiated, how often they should be reviewed and updated, and the preference for using basic agreements developed by other agencies to promote consistency. In practice, this section is meant to preserve the flexibility and academic independence often needed in research while still giving the Government enough control to protect its interests, manage key personnel, and maintain oversight of the research direction and performance.

Broad agency announcement.

FAR 35.016 explains when and how agencies may use a broad agency announcement (BAA) with peer or scientific review to acquire basic and applied research, and development work that is not tied to a specific system or hardware procurement. It is designed for situations where the Government is seeking scientific study, experimentation, and advancement of knowledge, rather than a defined product or solution, and where meaningful proposals with different technical approaches are reasonably expected. The section tells agencies what the BAA must contain, including the agency’s research interests, evaluation criteria and their relative importance, the proposal acceptance period, and proposal preparation/submission instructions. It also requires public notice through the Governmentwide point of entry and, when authorized, in scientific or technical periodicals, with at least annual publication. The rule further explains that proposals must be reviewed under the stated criteria through a peer or scientific review process, that proposals do not have to be compared against one another, and that selection is driven primarily by technical merit, relevance to agency programs, and available funding, with cost realism and reasonableness considered as appropriate. Finally, it clarifies that separate synopses for individual contract actions arising from BAA proposals are not required because the BAA notice itself satisfies the synopsis requirement.

Federally Funded Research and Development Centers.

FAR 35.017 establishes the federal policy framework for Federally Funded Research and Development Centers (FFRDCs) and their sponsoring agreements. It explains what an FFRDC is, why the Government uses one, the special access and operating conditions that distinguish an FFRDC from an ordinary contractor, and the expectation that the center operate in the public interest with objectivity, independence, and full disclosure to its sponsor. The section also addresses who may operate an FFRDC, the importance of long-term relationships, and the role of multiple sponsorship arrangements. In practical terms, this section is the policy basis for creating, using, reviewing, and terminating FFRDC relationships, and it signals that FFRDCs are reserved for special long-term research or development needs that cannot be met as effectively by in-house resources or ordinary contractors. It also makes clear that privileged access is not meant to give an FFRDC an unfair competitive advantage in the private sector, while still allowing work for other agencies when authorized and when the work is not otherwise available from the private sector. Finally, the definitions of sponsor, primary sponsor, and nonsponsor are critical because they determine who manages the relationship, who controls overall use, and how work funded by others is treated.