Overview
This section outlines the three specific contracting methods available to a contracting officer for implementing a leader company arrangement and mandates protections for proprietary information.
Key Rules
- Three Award Methods: The contracting officer can structure the arrangement in one of three ways:
- Award a prime contract to the Leader, who then subcontracts production to the Follower.
- Award separate prime contracts to both: one to the Leader for technical assistance and one to the Follower for production.
- Award a prime contract to the Follower, who then subcontracts with the Leader for technical assistance.
- Proprietary Data Protection: The contracting officer must ensure the contract includes a firm agreement governing the disclosure and protection of trade secrets, technical designs, and proprietary software or data between the parties.
Practical Implications
- Flexibility in Execution: Agencies can choose the contract structure that best fits the administrative capabilities of the companies involved and the level of oversight the government wishes to maintain over the production process.
- IP Risk Mitigation: Because these arrangements force a "Leader" to share expertise with a "Follower," strict contractual safeguards on intellectual property are essential to encourage industry participation and prevent the unauthorized loss of a contractor’s competitive advantage.