Defense Federal Acquisition Regulation Supplement: Update of Challenge Period for Validation of Asserted Restrictions on Technical Data and Computer Software (DFARS Case 2022-D016)

DEPARTMENT OF DEFENSE <SUBAGY>Defense Acquisition Regulations System</SUBAGY> <CFR>48 CFR Part 252</CFR> <DEPDOC>[Docket DARS-2022-0030]</DEPDOC> <RIN>RIN 0750-AL67</RIN> <SUBJECT>Defense Federal Acquisition Regulation Supplement: Update of Challenge Period for Validation of Asserted Restrictions on Technical Data and Computer Software (DFARS Case 2022-D016)</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Defense Acquisition Regulations System, Department of Defense (DoD). <HD SOURCE="HED">ACTION:</HD> Proposed rule. <SUM> <HD SOURCE="HED">SUMMARY:</HD> DoD is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to implement a section of the National Defense Authorization Act for Fiscal Year 2012, which addresses the validation of proprietary data restrictions. In addition to the request for written comments, DoD will hold a public meeting to hear the views of interested parties. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> Comments on the proposed rule should be submitted in writing to the address shown below on or before June 24, 2024, to be considered in the formation of a final rule. <E T="03">Public Meeting:</E> A virtual public meeting will be held on May 17, 2024, from 1:00 p.m. to 5:00 p.m. Eastern time. The public meeting will end at the stated time, or when the discussion ends, whichever comes first. <E T="03">Registration:</E> Registration to attend the public meeting must be received no later than close of business on May 9, 2024. Information on how to register for the public meeting is provided under the <E T="02">SUPPLEMENTARY INFORMATION</E> section of this proposed rule. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> <E T="03">Public Meeting:</E> A virtual public meeting will be held using Zoom video conferencing software. <E T="03">Submission of Comments:</E> Submit comments identified by DFARS Case 2022-D016, using either of the following methods: ○ <E T="03">Federal eRulemaking Portal: https://www.regulations.gov.</E> Search for DFARS Case 2022-D016. Select “Comment” and follow the instructions to submit a comment. Please include “DFARS Case 2022-D016” on any attached documents. ○ <E T="03">Email: osd.dfars@mail.mil.</E> Include DFARS Case 2022-D016 in the subject line of the message. Comments received generally will be posted without change to <E T="03">https://www.regulations.gov,</E> including any personal information provided. To confirm receipt of your comment(s), please check <E T="03">https://www.regulations.gov,</E> approximately two to three days after submission to verify posting. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> David Johnson, telephone 202-913-5764. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Background</HD> DoD is proposing to revise the DFARS to implement section 815(b) of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2012 (Pub. L. 112-81). Section 815(b) amended 10 U.S.C. 2321 (currently 10 U.S.C. 3782) by increasing the validation period for asserted restrictions from three years to six years. Section 815(b) also amended 10 U.S.C. 2321 to provide an exception to the prescribed time limit for validation of asserted restrictions if the technical data involved are the subject of a fraudulently asserted use or release restriction. DoD published an advance notice of proposed rulemaking (ANPR) in the <E T="04">Federal Register</E> on December 16, 2022, at 87 FR 77055, providing draft DFARS revisions and requesting written public comments. DoD hosted a public meeting to obtain the views of interested parties regarding the ANPR on January 26, 2023. The preamble to the ANPR provided detailed explanations of revisions related to— • The validation period for asserted restrictions; and • The new statutory exception to the prescribed time limit for validation of asserted restrictions. One respondent submitted public comments in response to the ANPR. <HD SOURCE="HD1">II. Public Meeting</HD> DoD is interested in continuing a dialogue with experts and interested parties in the Government and the private sector regarding amending the DFARS to implement section 815(b) of the NDAA for FY 2012. <E T="03">Registration:</E> Individuals wishing to participate in the virtual meeting must register by May 9, 2024, to facilitate entry to the meeting. Interested parties may register for the meeting by sending the following information via email to <E T="03">osd.dfars@mail.mil</E> and include “Public Meeting, DFARS Case 2022-D016” in the subject line of the message: • Full name. • Valid email address, which will be used for admittance to the meeting. • Valid telephone number, which will serve as a secondary connection method. Registrants must provide the telephone number they plan on using to connect to the virtual meeting. • Company or organization name. • Whether the individual desires to make a presentation. Pre-registered individuals will receive instructions for connecting using the Zoom video conferencing software not more than one week before the meeting is scheduled to commence. <E T="03">Presentations:</E> Presentations will be limited to 5 minutes per company or organization. This limit may be subject to adjustment, depending on the number of entities requesting to present, in order to ensure adequate time for discussion. If you wish to make a presentation, please submit an electronic copy of your presentation via email to <E T="03">osd.dfars@mail.mil</E> no later than the registration date for the meeting. Each presentation should be in PowerPoint to facilitate projection during the public meeting and should include the presenter's name, title, organization affiliation, telephone number, and email address on the cover page. <E T="03">Correspondence, Comments, and Presentations:</E> Please cite “Public Meeting, DFARS Case 2022-D016” in all correspondence related to the public meeting. There will be no transcription at the meeting. The submitted presentations will be posted to the following website at the conclusion of the public meeting: <E T="03">https://www.acq.osd.mil/dpap/dars/technical_data_rights.html.</E> <HD SOURCE="HD1">III. Discussion and Analysis</HD> DoD reviewed the public comments in response to the ANPR in the development of the proposed rule. No changes are made in this proposed rule text as a result of the public comments. A discussion of the comments is provided, as follows: <HD SOURCE="HD2">A. Analysis of Public Comments</HD> <HD SOURCE="HD3">1. Virtual Public Meetings</HD> <E T="03">Comment:</E> The respondent thanked DoD for the opportunity to participate in the rulemaking process and provide input. <E T="03">Response:</E> DoD acknowledges the respondent's comment. <HD SOURCE="HD3">2. Definition of Fraud</HD> <E T="03">Comment:</E> The respondent requested clarification with respect to when a use or release restriction would be considered “fraudulently asserted.” In particular, the respondent asked whether there is a knowledge requirement on behalf of the contractor asserting restrictions. <E T="03">Response:</E> The statutory revisions being implemented in DFARS Case 2022-D016 do not establish a specialized definition of “fraudulently asserted” or a knowledge requirement. DoD will rely upon the common meaning of the terminology used in the statute and regulatory implementation, informed by applicable procurement statutes, other applicable statutes, and case precedent. <HD SOURCE="HD3">3. Deferred Ordering and the Challenge Period</HD> <E T="03">Comment:</E> The respondent requested clarification regarding applicability to deferred ordering situations. The respondent asked if the period related to final payment resets when a payment is made on a deferred ordering basis. <E T="03">Response:</E> The proposed rule includes the following language related to technical data: “During the period within 6 years of final payment on a contract or within 6 years of delivery of the technical data to the Government, whichever is later, the Contracting Officer may review and make a written determination to challenge the restriction.” It also includes the following language regarding software: “the Government may exercise this right only within 6 years after the date(s) the software is delivered or otherwise furnished to the Government, or 6 years following final payment under this contract, whichever is later.” Invocation of the deferred ordering clause institutes new technical data or software delivery requirements; these deliverables may be delivered under the original contract (in which the clause was incorporated) or another contract. Accordingly, the expiration of the challenge period will depend upon the date the data is furnished or the date of final payment under the contract where the technical data or software is delivered, whichever is later. <HD SOURCE="HD2">B. Other Changes</HD> The proposed rule includes other changes to align the language in the clauses at DFARS 252.227-7019, Validation of Asserted Restrictions—Computer Software, and DFARS 252.227-7037, Validation of Restrictive Markings on Technical Data. In addition, editorial changes were made, including updates to comport with DFARS content and drafting conventions. For example, the proposed rule includes changes to the clauses to consistently refer to validation of “asserted restrictions” (rather than “restrictive markings”), thereby aligning this language with the scope and purpose of the clauses and the underlying statutes (10 U.S.C 3781-3786). In addition, the proposed rule includes revisions to the clauses to ensure consistent syntax in instances where the clause refers to striking or correcting a restrictive marking. Furthermore, the proposed rule corrects all references to the “United States ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 30k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━