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Clauses · DFARS · Data rights

DFARS 252.227-7038 Patent Rights—Ownership by the Contractor (Large Business)

Does the regulation require it to flow down?

Yes

Per (l)(2): the clause in the sub keeps all references to the government and gives the sub the same rights and obligations as the prime; the prime may not take rights in the sub's inventions as consideration for the award ((l)(2)(i)); and (l)(2)(ii) creates a direct sub–government contract on these matters.

Form
substance, forked by (l)(1): FAR 52.227-11 for small business/nonprofit subs ((l)(1)(i)); the substance of the 7038, including (l) itself, for all other subs doing experimental, developmental, or research work ((l)(1)(ii)), unless a different patent clause is required by FAR 27.303
Reaches
all tiers

Checked against acquisition.gov on 2026-08-11 · edition JUN 2012 · base v0.9.3 Read the text ↗

What it makes you produce

4 items for your checklist, slowest first.

  1. Something you write3

    Days to weeks, and nobody outside your company has to agree to it.

    • A written disclosure with the technical detail, the contract it was made under, and any publication, sale or public use named

      Owed when an inventor reports a subject invention in writing — two months from that report, or six months from when you first became aware of it, whichever is earlier

      252.227-7038(c)(1)
    • Written agreements binding your technical employees to report promptly what they invent

      Owed when you employ anyone other than clerical and nontechnical staff on the work — without it the disclosure deadline cannot be met

      252.227-7038(e)(2)(i)
    • Utilization reports — status of development, first commercial sale or use, gross royalties received

      Owed when the agency requests them, no more often than annually

      252.227-7038(f)(1)

  2. Something you fill in and send back

    Hours, once you know which one is missing.

    • The instruments that confirm the Government's rights, or assign title, executed and delivered to the agency

      Owed when you elect to keep ownership of a subject invention, or the agency requests title under (d)(1)

      252.227-7038(e)(1)

When it is used

Prescribed at 227.303(2): DoD contracts for experimental, developmental, or research work performed by a large business. Flows down to every subcontract for that kind of work, at any tier, with a fork: small/nonprofit subs get FAR 52.227-11; everyone else gets the substance of the 7038 itself.

Read closely

A small business or nonprofit supplier of yours gets FAR 52.227-11 rather than this clause ((l)(1)(i)), and the tier above may not take rights in your inventions as consideration for the award ((l)(2)(i)). The Government keeps a paid-up license and march-in rights under either clause.

The 14 templates that name it, with the line
143CORPDOC 3A — FAR/DFARS Flowdown Provisions for Fixed Price Non-Commercial Items under a DoD Prime ContractLockheed Martinline 442155CORPDOC 4A — FAR/DFARS Flowdown Provisions for Cost-Reimbursement/T&M Subcontracts under a DoD Prime ContractLockheed Martinline 477233RTX Flowdown of U.S. Government Contract Clauses Under U.S. Government ContractsRTXline 3660Raytheon TC-003 — Supplement 2: Government Contract Provisions from the DFARSRTXline 147166Northrop Grumman CTM-P-ST-001 — U.S. Government Firm Fixed Price Order (Not for Commercial Products and Services)Northrop Grummanline 2511166Northrop Grumman CTM-P-ST-003 — U.S. Government T&M Order (Not for Commercial Products and Services)Northrop Grummanline 2448168Northrop Grumman CTM-P-ST-004 — U.S. Government Cost Reimbursement Order (Not for Commercial Products and Services)Northrop Grummanline 2545255GD Mission Systems SCM-TMP-005 — General Provisions, Firm Fixed Price PO under U.S. Government Contract (Non-Commercial)General Dynamicsline 1107243GD Mission Systems SCM-TMP-048 — T&M Purchase Orders for Non-Commercial Items in Support of a U.S. Government ContractGeneral Dynamicsline 2031240L3Harris LGL-50.F1 — General T&C and Flowdown Clauses for Other Than Commercial Products/Services under a U.S. Government ContractL3Harrisline 272910BAE Systems Inc. USGOVGOODS — General Clauses for Subcontracts/Purchase Orders for Goods under a U.S. Government Prime ContractBAE Systemsline 1755273BAE Systems Inc. USGOVA — FAR/DFARS Flow Down Provisions for Subcontracts/Purchase Orders under a U.S. Government (DoD) Prime ContractBAE Systemsline 12906BAE Systems Inc. — General Clauses for Commercial Goods and/or Services under a U.S. Government DoD Prime ContractBAE Systemsline 1579178AAR Component Services NY — U.S. Government Contract FAR and DFARS Clauses Incorporated by ReferenceAAR Corpline 1357

Source: acquisition.gov, DFARS 252.227-7038. CODIFIED REGIME, read 2026-08-11 on the part-252 page at DFARS Change 5/7/2026: "As prescribed in 227.303(2), use the following clause:" with designation PATENT RIGHTS—OWNERSHIP BY THE CONTRACTOR (LARGE BUSINESS) (JUN 2012). DEVIATION REGIME: the part-27 memo prints the identical head, "As prescribed in 227.303(2), use the following clause:", and the identical designation, and 227.303(2)(i) reads "Insert the clause at 252.227-7038, Patent Rights—Ownership by the Contractor (Large Business), instead of the clause at FAR 52.227-11". THE TWO REGIMES AGREE. TO RE-DERIVE WITHOUT REDOING THE RESEARCH: fetch acquisition.gov/sites/default/files/page_file_uploads/DoD_RFO_Deviation_Part-27.pdf (1125972 bytes, 117 pages, DARS Tracking Number 2026-O0036, "Effective February 1, 2026, contracting officers shall use"), run pdftotext -layout over it, and grep for 252.227-7038 — 2 occurrences on 2026-08-11, poppler pdftotext. (verified 2026-08-11)

This is research, not legal advice. It states what the regulation says about this clause and cites the paragraph behind it. It does not rule on your order, and it does not rule on whether a prime's markings are correct.