Notice2023-12854
Implementation of the NIH SBIR and STTR Foreign Disclosure Pre-Award and Post-Award Requirements
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
June 16, 2023
Issuing agencies
Health and Human Services DepartmentNational Institutes of Health
Abstract
The National Institutes of Health (NIH) announces publication and serves as Notice for the extramural community on recent policy changes made for the Small Business Innovation Research Program (SBIR) and the Small Business Technology Transfer Program (STTR). This Notice implements additional disclosure requirements and post-award reporting requirements for small business concerns (SBCs) for covered relationships. In addition, this serves as notification of NIH's due diligence program to assess security risks and denial of award when foreign relationships or commitments with countries of concern pose a significant risk as provided in the SBIR and STTR Extension Act of 2022 at https://www.congress.gov/117/plaws/publ183/PLAW-117publ183.pdf under these programs. This policy serves as an update to section 18. Grants to For Profit Organizations of the NIH Grants Policy Statement (GPS) at https://grants.nih.gov/grants/policy/nihgps/HTML5/section_18/ 18_grants_to_for-profit_organizations.htm and will be incorporated in the FY24 publication. In addition, the NIH Application Guide will be updated to reflect instructions for submission of required documentation.
Full Text
<html>
<head>
<title>Federal Register, Volume 88 Issue 116 (Friday, June 16, 2023)</title>
</head>
<body><pre>
[Federal Register Volume 88, Number 116 (Friday, June 16, 2023)]
[Notices]
[Pages 39439-39441]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-12854]
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
National Institutes of Health
Implementation of the NIH SBIR and STTR Foreign Disclosure Pre-
Award and Post-Award Requirements
AGENCY: National Institutes of Health, HHS.
ACTION: Notice.
-----------------------------------------------------------------------
SUMMARY: The National Institutes of Health (NIH) announces publication
and serves as Notice for the extramural community on recent policy
changes made for the Small Business Innovation Research Program (SBIR)
and the Small Business Technology Transfer Program (STTR). This Notice
implements additional disclosure requirements and post-award reporting
requirements for small business concerns (SBCs) for covered
relationships. In addition, this serves as notification of NIH's due
diligence program to assess security risks and denial of award when
foreign relationships or commitments with countries of concern pose a
significant risk as provided in the SBIR and STTR Extension Act of 2022
at <a href="https://www.congress.gov/117/plaws/publ183/PLAW-117publ183.pdf">https://www.congress.gov/117/plaws/publ183/PLAW-117publ183.pdf</a> under
these programs. This policy serves as an update to section 18. Grants
to For Profit Organizations of the NIH Grants Policy Statement (GPS) at
<a href="https://grants.nih.gov/grants/policy/nihgps/HTML5/section_18/18_grants_to_for-profit_organizations.htm">https://grants.nih.gov/grants/policy/nihgps/HTML5/section_18/18_grants_to_for-profit_organizations.htm</a> and will be incorporated in
the FY24 publication. In addition, the NIH Application Guide will be
updated to reflect instructions for submission of required
documentation.
DATES: The policy changes are now available for viewing.
ADDRESSES: Please visit our website to view the policy changes at
<a href="https://grants.nih.gov/policy/PolicyNotices.php">https://grants.nih.gov/policy/PolicyNotices.php</a>.
FOR FURTHER INFORMATION CONTACT: Stephanie Fertig, Health and Human
Services (HHS) Small Business Program Lead, Small business Education
and Entrepreneurial Development (SEED). Email: <a href="/cdn-cgi/l/email-protection#396a7c7c7d50575f5679575051175e564f"><span class="__cf_email__" data-cfemail="ca998f8f8ea3a4aca58aa4a3a2e4ada5bc">[email protected]</span></a>. Phone
number (301) 827-8595. Centers for Disease Control and Prevention (CDC)
Contact: Terrance Perry, CDC Office of Grants Services, Office of
Financial Resources. Email: <a href="/cdn-cgi/l/email-protection#337c7460635c5f5a504a735057501d545c45"><span class="__cf_email__" data-cfemail="82cdc5d1d2edeeebe1fbc2e1e6e1ace5edf4">[email protected]</span></a>. Phone number (770) 488-
8424). Food and Drug Administration (FDA) Contact: Kimberly Pendleton,
FDA Office of Finance, Budget, Acquisitions, and Planning. Email:
<a href="/cdn-cgi/l/email-protection#f1ba989c9394839d88dfa1949f959d94859e9fb1979590df999982df969e87"><span class="__cf_email__" data-cfemail="aae1c3c7c8cfd8c6d384facfc4cec6cfdec5c4eacccecb84c2c2d984cdc5dc">[email protected]</span></a>. Phone number (240) 402-7610.
SUPPLEMENTARY INFORMATION:
Background
The SBIR and STTR Extension Act of 2022 (the Act) Public Law 117-
183, 136 stat. 2180 <a href="https://www.congress.gov/117/plaws/publ183/PLAW-117publ183.pdf">https://www.congress.gov/117/plaws/publ183/PLAW-117publ183.pdf</a>, signed into law by President Biden on September 30,
2022, reauthorized the SBIR program, the STTR program, and related
pilot programs through September 30, 2025.
The Act includes major changes to the SBIR and STTR programs,
including:
<bullet> increased minimum performance standards (refer to NOT-OD-
23-092, <a href="https://grants.nih.gov/grants/guide/notice-files/NOT-OD-23-092.html">https://grants.nih.gov/grants/guide/notice-files/NOT-OD-23-092.html</a>),
<bullet> disclosure requirements regarding ties to foreign
countries,
<bullet> a requirement for federal agencies that manage SBIR and
STTR programs to establish a due diligence program to assess security
risks posed by applicants,
<bullet> denial of award and recovery authority provisions when
ties to foreign countries of concern pose a significant risk.
Foreign countries of concern are defined in the Act as the People's
Republic of China, the Democratic People's Republic of North Korea, the
Russian Federation, the Islamic Republic of Iran, or any other country
determined to be a country of concern by the U.S. Secretary of State.
An up-to-date list of countries determined to be countries of concern
by the Secretary of State will be maintained and accessible on <a href="http://SBIR.gov">SBIR.gov</a>
on SBA's Required Disclosures of Foreign Affiliations or Relations web
page at <a href="https://www.sbir.gov/foreign_disclosures">https://www.sbir.gov/foreign_disclosures</a>.
In response to the passing of the Act, the U.S. Small Business
Administration (SBA) has issued a form, Required Disclosures of Foreign
Affiliations or Relationships to Foreign Countries (referred to as the
``disclosure form'' hereafter) that will be administered by federal
agencies to identify and assess the risk of covered foreign
relationships for SBC applicants applying for SBIR and STTR funding.
Publication of the final form is forthcoming.
Applicability
This policy applies to all competing applications for funding under
the NIH, CDC, and FDA SBIR and STTR programs submitted for due dates on
or after September 5, 2023.
Policy
Each SBC applying for the SBIR and STTR programs under the NIH,
CDC, and FDA is required to disclose all funded and unfunded
relationships with foreign countries, using the disclosure form, for
all owners and covered individuals. A ``covered individual'' is defined
as all senior key personnel identified by the SBC in the application
(i.e., individuals who contribute to the scientific development or
execution of a project in a substantive, measurable way). Applicants
must include the following information on the disclosure form:
<bullet> the identity of all owners and covered individuals of the
SBC who are a party to any malign foreign talent recruitment program;
<bullet> the existence of any parent company, joint venture, or
subsidiary of the SBC that is based in or receives funding from, any
foreign country of concern;
<bullet> any current or pending contractual or financial obligation
or other agreement specific to a business arrangement, or joint
venture-like arrangement with an enterprise owned by a foreign state or
any foreign entity;
<bullet> whether the SBC is wholly owned in a foreign country;
[[Page 39440]]
<bullet> any venture capital or institutional investment and if the
investing entity has a general partner or any other individual holding
a leadership who has a foreign affiliation with any foreign country of
concern;
<bullet> any technology licensing or intellectual property sales or
transfers to a foreign country of concern during the 5-year period
preceding submission of the proposal;
<bullet> any foreign business entity, offshore entity, or entity
outside the United States related to the SBC;
<bullet> any owners, officers, or covered individuals that have a
foreign affiliation with a research institution located in a foreign
country of concern;
<bullet> information technology and information safeguarding plans.
Upon request, applicants will submit the completed disclosure form
via the Just-In-Time (JIT) process described in the NIH GPS section
2.5.1 Just-in-Time Procedures at <a href="https://grants.nih.gov/grants/policy/nihgps/HTML5/section_2/2.5.1_just-in-time_procedures.htm">https://grants.nih.gov/grants/policy/nihgps/HTML5/section_2/2.5.1_just-in-time_procedures.htm</a>. The
disclosure form and any additional agency-specific information must be
submitted electronically using the Just-in-Time feature in the eRA
Commons. Applicants must continue to comply with NIH Other Support
disclosure requirements as provided in Section 2.5.1 at <a href="https://grants.nih.gov/grants/policy/nihgps/HTML5/section_2/2.5.1_just-in-time_procedures.htm">https://grants.nih.gov/grants/policy/nihgps/HTML5/section_2/2.5.1_just-in-time_procedures.htm</a>. SBC applicants applying to CDC and FDA will follow
each agency's policies for submitting additional documents during the
pre-award process. Applicants may be required to provide similar
information on the disclosure form that is also submitted as a part of
the other support reporting for senior/key personnel identified in the
application. Applicants that do not submit the completed disclosure
form during the JIT process will not be considered for funding.
SBIR/STTR Notices of funding opportunities and terms and conditions
of award will be updated to reflect the policy above.
Due Diligence Program To Assess Security Risks
NIH, CDC, and FDA have implemented a due diligence program designed
to assess security risks posed by applicants. The due diligence program
will assess the cybersecurity practices, patent analysis, employee
analysis, and foreign ownership of a SBC seeking an award, including
the financial ties and obligations of the SBC and employees of the SBC
to a foreign country, foreign person, or foreign entity. After
reviewing the application, including JIT elements and the disclosure
form, NIH, CDC, and FDA may request the SBC provide copies of any
contractual or financial obligation or other agreement specific to a
business arrangement, or joint venture-like arrangement with an
enterprise owned by a foreign state or any foreign entity in effect
during the 5-year period (calendar year) preceding submission of the
proposal. NIH, CDC, and FDA may decline to move forward with an award
based on security risks determined during the assessment. NIH, CDC, and
FDA will not issue an award prior to completing the assessment process.
Denial of Awards
Applicants and recipients are encouraged to consider whether their
entity's relationships with foreign countries of concern will pose a
security risk. Prior to issuing an award, NIH, CDC, and FDA will
determine whether the SBC submitting the application:
<bullet> has an owner or covered individual that is party to a
malign foreign talent recruitment program;
<bullet> has a business entity, parent company, or subsidiary
located in the People's Republic of China or another foreign country of
concern; or
<bullet> has an owner or covered individual that has a foreign
affiliation with a research institution located in the People's
Republic of China or another foreign country of concern.
A finding of foreign involvement with countries of concern will not
necessarily disqualify an applicant. NIH, CDC, and FDA will provide SBC
applicants the opportunity to address any identified security risks
prior to award. Final award determinations will be based on whether the
applicant's involvement falls within any of the following risk
criteria, per the Act:
<bullet> interfere with the capacity for activities supported by
NIH, CDC, or FDA to be carried out;
<bullet> create duplication with activities supported by NIH, CDC,
or FDA;
<bullet> present concerns about conflicts of interest;
<bullet> were not appropriately disclosed to NIH, CDC, or FDA;
<bullet> violate Federal law or terms and conditions of NIH, CDC,
or FDA; or
<bullet> pose a risk to national security.
NIH, CDC, and FDA will not issue an award under the SBIR/STTR
program if the covered relationship with a foreign country of concern
identified in this guidance is determined to fall under any of the
criteria provided above, and the risk cannot be resolved.
Post-Award Reporting Requirements
Recipients are responsible for monitoring their relationships with
foreign countries of concern post-award, for any changes that may
impact previous disclosures. SBCs receiving an award under the SBIR/
STTR program are required to submit an updated disclosure form to
report any of the following changes to NIH, CDC, and FDA throughout the
duration of the award:
<bullet> any change to a disclosure on the disclosure form;
<bullet> any material misstatement that poses a risk to national
security; and
<bullet> any change of ownership, change to entity structure, or
other substantial change in circumstances of the SBC that NIH, CDC, and
FDA determine poses a risk to national security.
Updated disclosure forms are required within 30 days of any change
in ownership, entity structure, covered individual, or other
substantive changes in circumstance, as described above. In addition,
regular updates are required at the time of all SBIR/STTR annual,
interim, and final Research Performance Progress Reports (RPPRs).
Recipients will be required to upload these updated disclosures using
the Additional Materials (AM) tool in eRA Commons. System enhancements
to facilitate these uploads are underway, with an anticipated
deployment in calendar year 2024. The RPPR Instruction Guide will be
updated to reflect this process.
If the recipient reports a covered foreign relationship that meets
any of the risk criteria prohibiting funding described in this
guidance, NIH, CDC, and FDA may withhold funding until the covered
relationship has been dissolved. The recipient will be required to
submit documentation verifying the relationship has been terminated. If
the risk cannot be resolved, NIH, CDC, and FDA may deem it necessary to
terminate the award for material failure to comply with the federal
statutes, regulations, or terms and conditions of the federal award.
Refer to Section 8.5.2 Remedies for Noncompliance or Enforcement
Actions: Suspension, Termination, and Withholding of Support (<a href="https://grants.nih.gov/grants/policy/nihgps/HTML5/section_8/8.5.2_remedies_for_noncompliance_or_enforcement_actions-_suspension__termination__and_withholding_of_support.htm?Highlight=termination">https://grants.nih.gov/grants/policy/nihgps/HTML5/section_8/8.5.2_remedies_for_noncompliance_or_enforcement_actions-_suspension__termination__and_withholding_of_support.htm?Highlight=termination</a> for more information. Recipients are encouraged to monitor their
covered foreign relationships post-award and avoid entering into
relationships, both funded and unfunded, that may pose a security risk
and jeopardize their ability to retain their award.
[[Page 39441]]
Agency Recovery Authority and Repayment of Funds
An SBC will be required to repay all amounts received from NIH,
CDC, and FDA under the award if either of the following determinations
are made upon assessment of a change to their disclosure:
<bullet> the SBC makes a material misstatement that NIH, CDC, and
FDA determine poses a risk to national security; or
<bullet> there is a change in ownership, change in entity
structure, or other substantial change in circumstances of the SBC that
NIH, CDC, and FDA determine poses a risk to national security.
The repayment requirements and procedures provided in Section 8.5.4
Recovery of Funds at <a href="https://grants.nih.gov/grants/policy/nihgps/HTML5/section_8/8.5.4_recovery_of_funds.htm">https://grants.nih.gov/grants/policy/nihgps/HTML5/section_8/8.5.4_recovery_of_funds.htm</a> of the NIH GPS apply and may also
be subject to additional noncompliance and enforcement actions as
described in Section 8.5.2 of the GPS. Recipients are required to
follow the repayment procedures provided in the Guidance for Repayment
of Grant Funds to the NIH at <a href="https://grants.nih.gov/policy/compliance.htm">https://grants.nih.gov/policy/compliance.htm</a>.
Dated: June 6, 2023.
Tara A. Schwetz,
Acting Principal Deputy Director, National Institutes of Health.
[FR Doc. 2023-12854 Filed 6-15-23; 8:45 am]
BILLING CODE 4140-01-P
</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>Indexed from Federal Register on June 16, 2023.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.