SBIR and STTR data rights

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1. A separate regime for small business research

Work under the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs carries its own data rights in the Defense Federal Acquisition Regulation Supplement (DFARS). They are set out in DFARS 227.7104 and the clause at DFARS 252.227-7018. SBIR/STTR data rights apply to data delivered, developed or generated under a contract or agreement covered by SBIR/STTR policies, including contracts and subcontracts with phase III work (DFARS 227.7104-1(d)). Phase III work derives from, extends or completes an effort under earlier SBIR/STTR awards and is funded from sources other than those programs. SBIR/STTR data means all technical data or software developed or generated in the performance of a phase I, II or III SBIR/STTR contract or subcontract (DFARS 252.227-7013(a)).

The clause at DFARS 252.227-7018 is used in solicitations and contracts, including commercial acquisitions under FAR part 12, whenever SBIR/STTR data are delivered, developed or generated (DFARS 227.7104-4(a)(1)). It also applies when any portion of performance is governed by SBIR or STTR policies, such as a subcontract that qualifies as a phase III award. The rest of the data and software under the same contract fall under the ordinary noncommercial data, noncommercial software or commercial data clauses (DFARS 227.7104-4(a)(2)).

2. No surrender as a price of award

Offerors may not be required to sell or give up rights in technical data for items developed under an SBIR/STTR contract, whether to be responsive or to win award (DFARS 227.7104-1(a)). The same applies to software generated under such a contract. The government receives only the standard rights the DFARS identifies. Contractors and offerors may not be prohibited from offering items or software developed under an SBIR/STTR contract solely because the government’s rights may be restricted (DFARS 227.7104-1(b)).

The government may, however, use information offerors provide in response to a solicitation in source selection (DFARS 227.7104-1(c)). It uses that information to evaluate how proposed restrictions would affect its ability to use or disclose data or software.

3. The standard license and the 20-year period

Under the clause, the government obtains unlimited rights in the technical data and software listed in its unlimited rights paragraph (DFARS 227.7104-2(a)(1)). In all other data and software developed or generated under a phase I, II or III SBIR/STTR contract or subcontract and marked with the SBIR/STTR data rights marking, it obtains SBIR/STTR data rights (DFARS 227.7104-2(a)(2)). Those rights give the government limited rights in the technical data and restricted rights in the software during the SBIR/STTR data protection period.

The protection period begins on the date of contract award and ends 20 years later, unless the agency and the contractor negotiate a different period after award (DFARS 227.7104-2(a)(2)). When the period ends, the government has government purpose rights in the SBIR/STTR data, and those rights do not expire. During the period, the government may not release or disclose the data or software to any person except as allowed for limited rights data or restricted rights software (DFARS 227.7104-2(b)).

4. Special licenses only after award

The government and the contractor or subcontractor may negotiate special license rights only after contract award (DFARS 227.7104-2(c)). The government may not make award conditional on the contractor negotiating, or agreeing to negotiate, special license rights. Such negotiation is authorized only after award, by mutual agreement.

The Small Business Administration’s SBIR and STTR Program Policy Directive, effective 3 May 2023, provides for special consideration in handling prototypes generated under SBIR and STTR awards, such as disclosure and reverse engineering (DFARS 227.7104-2(d)). The aim is to avoid effects that may appear inconsistent with the programs’ objectives and to let the awardee keep its rights during the protection period.

5. Data that are not SBIR/STTR data

The SBIR/STTR clause governs only SBIR/STTR data, and other data in the same contract follow their usual rules (DFARS 227.7104-2(e)). Technical data for noncommercial items, or for portions of commercial items developed in any part at government expense, fall under DFARS 252.227-7013. Data for portions of commercial items developed exclusively at private expense fall under DFARS 252.227-7015. Noncommercial software falls under DFARS 252.227-7014, and commercial software under the license customarily provided to the public.

For SBIR/STTR data that are noncommercial, the DFARS points to the general rules on copyright licenses, marking, contractor records, and nonconforming and unjustified markings (DFARS 227.7104-1(e)). Solicitations and contracts that include the SBIR/STTR clause also carry a set of companion provisions and clauses (DFARS 227.7104-4(b)). They cover rights in bid or proposal information, identification of restrictions, validation of asserted restrictions on software and on technical data, limits on government-furnished information, previously delivered data, and withholding of payment.

6. Extra steps for STTR awards

Before award of an STTR contract, the provision at DFARS 252.227-7040 requires offerors to submit a written agreement with the research institution that allocates intellectual property rights (DFARS 227.7104-3(a)). They must also submit a written representation that they are satisfied with it. The contracting officer reviews the agreement to make sure it does not conflict with the solicitation or with any right to carry out follow-on research. If conflicts exist and cannot be resolved, the proposal is not eligible for award.

At award, under the clause at DFARS 252.227-7041, the contracting officer attaches the accepted agreement and representation to the contract (DFARS 227.7104-3(b)). If the agreement is later modified, the contracting officer reviews the change and attaches it if it meets the clause’s requirements (DFARS 227.7104-3(c)). The limited and restricted rights that apply during the protection period are covered in limited rights and negotiated licenses and restricted rights in computer software. The preaward provision goes in solicitations that contain the postaward clause, and that clause is used in solicitations and contracts for STTR acquisitions, including commercial ones (DFARS 227.7104-4(c)).

Key terms

SBIR/STTR data rights	Limited rights in data and restricted rights in software during the protection period.
Protection period	Twenty years from contract award unless the parties negotiate another period after award.
Phase III work	Work extending or completing an earlier SBIR/STTR effort, funded from other sources.
Government purpose rights	The rights the government holds, without expiry, once the protection period ends.
Research institution agreement	The STTR agreement allocating intellectual property, reviewed before award.

Every statement above links to the document behind it. The full source list for this piece is on the sources page.

This page describes public United States government programs for general information. It is not legal, regulatory or procurement advice, and it does not address the facts of any particular case.

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