FAR 52.227-11—Patent Rights-Ownership by the Contractor.
Plain-English Summary
FAR 52.227-11, Patent Rights—Ownership by the Contractor, is the standard Bayh-Dole patent rights clause used in many federal contracts when the contractor is allowed to keep title to inventions made under the contract. It defines key terms such as invention, made, nonprofit organization, practical application, and subject invention, then sets out the contractor’s ownership rights, the Government’s license rights, and the contractor’s disclosure, election, and patent-filing obligations. The clause also explains when the Government can require assignment of title, how the contractor’s license can be transferred or modified, and how foreign patent filings and secrecy orders affect timing. In practice, this clause is the core framework for managing intellectual property created with federal funding: it protects contractor ownership while ensuring the Government receives timely disclosure, a license, and the ability to secure title if the contractor does not comply. It matters to both contractors and contracting officers because missed deadlines, incomplete disclosures, or failure to file can cause loss of rights, title transfer to the agency, or limits on foreign patent protection.
Key Rules
Key terms control rights
The clause defines invention, made, nonprofit organization, practical application, and subject invention. These definitions determine whether the clause applies and when an invention is considered created, disclosed, or commercially used.
Contractor may keep title
The contractor may retain ownership of each subject invention worldwide, but only if it complies with the clause’s disclosure, election, and filing requirements. Ownership is not automatic if the contractor misses required deadlines or declines to retain title.
Government gets a license
If the Government obtains title, the contractor generally keeps a nonexclusive, royalty-free worldwide license, unless it failed to disclose the invention on time. The license can extend to domestic subsidiaries and affiliates and may include sublicensing rights if the contractor was already obligated to grant them.
Timely disclosure is mandatory
The contractor must disclose each subject invention in writing to the contracting officer within 2 months after the inventor discloses it to contractor patent personnel. The disclosure must identify the inventors, the contract, technical details, and any publication, sale, public use, or manuscript submission status.
Election of title has deadlines
The contractor must elect in writing whether to retain ownership within 2 years after disclosure to the agency, but the agency may shorten that period when public disclosure starts the U.S. one-year patent clock. Failure to elect on time can trigger Government title rights.
Patent filing is required after election
For elected inventions, the contractor must file a provisional or nonprovisional patent application, or a plant variety protection application, within 1 year after election. If a provisional is filed, a nonprovisional must follow within 10 months, and foreign filings must be made within the specified foreign-filing windows unless a secrecy order delays filing.
Government can demand assignment
The agency may request assignment of title if the contractor fails to disclose or elect ownership on time, or elects not to retain title. The agency’s request is time-limited and generally must be made within 60 days after it learns of the contractor’s failure.
Extensions may be available
The contractor may request extensions for disclosure, election, or filing deadlines. This provides flexibility, but the contractor should not assume extensions will be granted and should request them before deadlines expire.
Responsibilities
Contractor
Identify subject inventions, ensure inventors promptly report them to patent personnel, disclose them in writing to the contracting officer on time, elect whether to retain title, file required patent or plant variety protection applications, request extensions when needed, and comply with foreign filing and assignment obligations.
Contracting Officer
Receive and track invention disclosures, monitor contractor election and filing deadlines, consider extension requests, and request assignment of title when the contractor misses required deadlines or declines ownership.
Agency
Administer the Government’s rights in subject inventions, determine when title should be requested, and manage any revocation or modification of the contractor’s license when needed to achieve practical application in a particular country.
Inventor / Contractor patent personnel
Report inventions internally in writing so the contractor can meet the 2-month disclosure deadline and preserve patent rights.
Practical Implications
Contractors need a strong internal invention-reporting process; the 2-month disclosure clock starts when the inventor discloses to the contractor’s patent personnel, not when the contractor finishes its internal review.
Public disclosure, sale, or public use can shorten patent deadlines, so teams must coordinate patent filing with publications, presentations, product launches, and customer demonstrations.
Missing the election or filing deadlines can cause the Government to request title, which can permanently change ownership and commercialization strategy.
Foreign filing deadlines are easy to miss because they depend on the first filing date or secrecy-order release date; contractors should track U.S. and foreign deadlines together.
The clause is not just about ownership—it is also about compliance documentation, because incomplete disclosures or late notices can affect the contractor’s retained license and the Government’s rights.
Official Regulatory Text
As prescribed in 27.303 (b)(1) , insert the following clause: Patent Rights-Ownership by the Contractor (May 2014) (a) As used in this clause- Invention means any invention or discovery that is or may be patentable or otherwise protectable under title 35 of the U.S. Code, or any variety of plant that is or may be protectable under the Plant Variety Protection Act ( 7 U.S.C. 2321 , et seq .) Made means- (1) When used in relation to any invention other than a plant variety, the conception or first actual reduction to practice of the invention; or (2) When used in relation to a plant variety, that the Contractor has at least tentatively determined that the variety has been reproduced with recognized characteristics. Nonprofit organization means a university or other institution of higher education or an organization of the type described in section 501(c)(3) of the Internal Revenue Code of 1954 ( 26 U.S.C. 501(c) ) and exempt from taxation under section 501(a) of the Internal Revenue Code ( 26 U.S.C. 501(a) ), or any nonprofit scientific or educational organization qualified under a State nonprofit organization statute. Practical application means to manufacture, in the case of a composition of 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. Subject invention means any invention of the Contractor made in the performance of work under this contract. (b) Contractor’s rights. (1) Ownership . The Contractor may retain ownership of each subject invention throughout the world in accordance with the provisions of this clause. (2) License. (i) The Contractor shall retain a nonexclusive royalty-free license throughout the world in each subject invention to which the Government obtains title, unless the Contractor fails to disclose the invention within the times specified in paragraph (c) of this clause. The Contractor’s license extends to any domestic subsidiaries and affiliates within the corporate structure of which the Contractor is a part, and includes the right to grant sublicenses to the extent the Contractor was legally obligated to do so at contract award. The license is transferable only with the written approval of the agency, except when transferred to the successor of that part of the Contractor’s business to which the invention pertains. (ii) The Contractor’s license may be revoked or modified by the agency to the extent necessary to achieve expeditious practical application of the subject invention in a particular country in accordance with the procedures in FAR 27.302 (i)(2) and 27.304-1 (f). (c) Contractor’s obligations. (1) The Contractor shall disclose in writing each subject invention to the Contracting Officer within 2 months after the inventor discloses it in writing to Contractor personnel responsible for patent matters. The disclosure shall identify the inventor(s) and this contract under which the subject invention was made. It shall be sufficiently complete in technical detail to convey a clear understanding of the subject invention. The disclosure shall also identify any publication, on sale ( i.e. , sale or offer for sale), or public use of the subject invention, or whether a manuscript describing the subject invention has been submitted for publication and, if so, whether it has been accepted for publication. In addition, after disclosure to the agency, the Contractor shall promptly notify the Contracting Officer of the acceptance of any manuscript describing the subject invention for publication and any on sale or public use. (2) The Contractor shall elect in writing whether or not to retain ownership of any subject invention by notifying the Contracting Officer within 2 years of disclosure to the agency. However, in any case where publication, on sale, or public use has initiated the 1-year statutory period during which valid patent protection can be obtained in the United States, 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 Contractor shall file either a provisional or a nonprovisional patent application or a Plant Variety Protection Application on an elected subject invention within 1 year after election. However, in any case where a publication, on sale, or public use has initiated the 1-year statutory period during which valid patent protection can be obtained in the United States, the Contractor shall file the application prior to the end of that statutory period. If the Contractor files a provisional application, it shall file a nonprovisional application within 10 months of the filing of the provisional application. The Contractor shall file patent applications in additional countries or international patent offices within either 10 months of the first filed patent application (whether provisional or nonprovisional) or 6 months from the date permission is granted by the Commissioner of Patents to file foreign patent applications where such filing has been prohibited by a Secrecy Order. (4) The Contractor may request extensions of time for disclosure, election, or filing under paragraphs (c)(1), (c)(2), and (c)(3) of this clause. (d) Government’s rights - (1) Ownership. The Contractor shall assign to the agency, on written request, title to any subject invention- (i) If the Contractor fails to disclose or elect ownership to the subject invention within the times specified in paragraph (c) of this clause, or elects not to retain ownership; provided, that the agency may request title only within 60 days after learning of the Contractor's failure to disclose or elect within the specified times. (ii) In those countries in which the Contractor fails to file patent applications within the times specified in paragraph (c) of this clause; provided, however, that if the Contractor has filed a patent application in a country after the times specified in paragraph (c) of this clause, but prior to its receipt of the written request of the agency, the Contractor shall continue to retain ownership in that country. (iii) In any country in which the Contractor decides not to continue the prosecution of any application for, to pay the maintenance fees on, or defend in reexamination or opposition proceeding on, a patent on a subject invention. (2) License. If the Contractor retains ownership of any subject invention, the Government shall have a nonexclusive, nontransferable, irrevocable, paid-up license to practice, or have practiced for or on its behalf, the subject invention throughout the world. (e) Contractor action to protect the Government’s interest. (1) The Contractor shall execute or have executed and promptly deliver to the agency all instruments necessary to- (i) Establish or confirm the rights the Government has throughout the world in those subject inventions in which the Contractor elects to retain ownership; and (ii) Assign title to the agency when requested under paragraph (d) of this clause and to enable the Government to obtain patent protection and plant variety protection for that subject invention in any country. (2) The Contractor shall 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 the Contractor's format, each subject invention in order that the Contractor 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. The disclosure format should require, as a minimum, the information required by paragraph (c)(1) of this clause. The Contractor shall instruct such employees, through employee agreements or other suitable educational programs, as to 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 Contractor shall notify the Contracting Officer of any decisions not to file a nonprovisional patent application, continue the 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 or filing period required by the relevant patent office. (4) The Contractor shall include, within the specification of any United States nonprovisional patent or plant variety protection application and any patent or plant variety protection certificate issuing thereon covering a subject invention, the following statement, "This invention was made with Government support under (identify the contract) awarded by (identify the agency). The Government has certain rights in the invention." (f) Reporting on utilization of subject inventions . The Contractor shall submit, on request, periodic reports no more frequently than annually on the utilization of a subject invention or on efforts at obtaining utilization of the subject invention that are being made by the Contractor or its licensees or assignees. The reports shall include information regarding the status of development, date of first commercial sale or use, gross royalties received by the Contractor, and other data and information as the agency may reasonably specify. The Contractor also shall provide additional reports as may be requested by the agency in connection with any march-in proceeding undertaken by the agency in accordance with paragraph (h) of this clause. The Contractor also shall mark any utilization report as confidential/proprietary to help prevent inadvertent release outside the Government. As required by 35 U.S.C. 202(c)(5) , the agency will not disclose that information to persons outside the Government without the Contractor’s permission. (g) Preference for United States industry. Notwithstanding any other provision of this clause, neither the Contractor nor any assignee shall grant to any person the exclusive right to use or sell any subject invention in the United States unless the person agrees that any products embodying the subject invention or produced through the use of the subject invention will be manufactured substantially in the United States. However, in individual cases, the requirement for an agreement may be waived by the agency upon a showing by the Contractor 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 United States, or that under the circumstances domestic manufacture is not commercially feasible. (h) March-in rights. The Contractor acknowledges that, with respect to any subject invention in which it has retained ownership, the agency has the right to require licensing pursuant to 35 U.S.C. 203 and 210 (c), and in accordance with the procedures in 37 CFR 401.6 and any supplemental regulations of the agency in effect on the date of contract award. (i) Special provisions for contracts with nonprofit organizations. If the Contractor is a nonprofit organization, it shall- (1) Not assign rights to a subject invention in the United States without the written approval of the agency, except where an assignment is made to an organization that has as one of its primary functions the management of inventions, provided , that the assignee shall be subject to the same provisions as the Contractor; (2) Share royalties collected on a subject invention with the inventor, including Federal employee co-inventors (but through their agency if the agency deems it appropriate) when the subject invention is assigned in accordance with 35 U.S.C. 202(e) and 37 CFR 401.10 ; (3) Use the balance of any royalties or income earned by the Contractor with respect to subject inventions, after payment of expenses (including payments to inventors) incidental to the administration of subject inventions for the support of scientific research or education; and (4) Make efforts that are reasonable under the circumstances to attract licensees of subject inventions that are small business concerns, and give a preference to a small business concern when licensing a subject invention if the Contractor determines that the small business concern has a plan or proposal for marketing the invention which, if executed, is equally as likely to bring the invention to practical application as any plans or proposals from applicants that are not small business concerns; provided , that the Contractor is also satisfied that the small business concern 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 Contractor. (5) Allow the Secretary of Commerce to review the Contractor’s licensing program and decisions regarding small business applicants, and negotiate changes to its licensing policies, procedures, or practices with the Secretary of Commerce when the Secretary’s review discloses that the Contractor could take reasonable steps to more effectively implement the requirements of paragraph (i)(4) of this clause. (j) Communications. [ Complete according to agency instructions. ] (k) Subcontracts. (1) The Contractor shall include the substance of this clause, including this paragraph (k), in all subcontracts for experimental, developmental, or research work to be performed by a small business concern or nonprofit organization. (2) The Contractor shall include in all other subcontracts for experimental, developmental, or research work the substance of the patent rights clause required by FAR subpart 27.3 . (3) At all tiers, the patent rights clause must be modified to identify the parties as follows: references to the Government are not changed, and the subcontractor has all rights and obligations of the Contractor in the clause. The Contractor shall not, as part of the consideration for awarding the subcontract, obtain rights in the subcontractor’s subject inventions. (4) In subcontracts, at any tier, the agency, the subcontractor, and the Contractor agree that the mutual obligations of the parties created by this clause constitute a contract between the subcontractor and the agency with respect to the matters covered by the clause; provided, however, that nothing in this paragraph is intended to confer any jurisdiction under the Contract Disputes statute in connection with proceedings under paragraph (h) of this clause. (End of clause) Alternate I (Jun 1989) . As prescribed in 27.303 (b)(3), add the following sentence at the end of paragraph (d)(2) of the basic clause: The license shall include the right of the Government to sublicense foreign governments, their nationals and international organizations pursuant to the following treaties or international agreements: _______ * [* Contracting Officer complete with the names of applicable existing treaties or international agreements. The above language is not intended to apply to treaties or agreements that are in effect on the date of the award but are not listed. ] Alternate II (Dec 2007) . As prescribed in 27.303 (b)(4), add the following sentence at the end of paragraph (d)(2) of the basic clause: The agency reserves the right to unilaterally amend this contract to identify specific treaties or international agreements entered into by the Government before or after the effective date of the contract and effectuate those license or other rights that are necessary for the Government to meet its obligations to foreign governments, their nationals, and international organizations under the treaties or international agreements with respect to subject inventions made after the date of the amendment. Alternate III (Jun 1989) . As prescribed in 27.303 (b)(5), substitute the following paragraph (i)(3) in place of paragraph (i)(3) of the basic clause: (3) After payment of patenting costs, licensing costs, payments to inventors, and other expenses incidental to the administration of subject inventions, the balance of any royalties or income earned and retained by the Contractor during any fiscal year on subject inventions under this or any successor contract containing the same requirement, up to any amount equal to 5 percent of the budget of the facility for that fiscal year, shall be used by the Contractor for the scientific research, development, and education consistent with the research and development mission and objectives of the facility, including activities that increase the licensing potential of other inventions of the facility. If the balance exceeds 5 percent, 75 percent of the excess above 5 percent shall be paid by the Contractor to the Treasury of the United States and the remaining 25 percent shall be used by the Contractor only for the same purposes as described above. To the extent it provides the most effective technology transfer, the licensing of subject inventions shall be administered by Contractor employees on location at the facility. Alternate IV (Jun 1989) . As prescribed in 27.303 (b)(6), include the following paragraph (e)(5) in paragraph (e) of the basic clause: (5) The Contractor shall establish and maintain active and effective procedures to ensure that subject inventions are promptly identified and timely disclosed, and shall submit a description of the procedures to the Contracting Officer so that the Contracting Officer may evaluate and determine their effectiveness. Alternate V (Dec 2007) . As prescribed in 27.303 (b)(7), include the following paragraph (d)(3) in paragraph (d) of the basic clause: (d)(3) CRADA licensing. If the Contractor performs 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 Government may require the Contractor to negotiate an agreement with the CRADA collaborating party or parties regarding the allocation of rights to any subject invention the Contractor makes, solely or jointly, under the CRADA. The agreement shall be negotiated prior to the Contractor undertaking the CRADA work or, with the permission of the Government, upon the identification of a subject invention. In the absence of such an agreement, the Contractor agrees to grant the collaborating party or parties an option for a license in its inventions of the same scope and terms set forth in the CRADA for inventions made by the Government.