NAM to Congress: Protect Innovation in America’s Defense Industrial Base

A proposed provision in the National Defense Authorization Act for Fiscal Year 2027 to remove the intellectual property rights of government contractors and expand the Pentagon’s access to the IP would undermine military readiness and disadvantage manufacturers, the NAM and more than two dozen allied groups recently told the House Committee on Armed Services.

What’s going on: Manufacturers oppose the proposed amendment, which “would strip intellectual property (IP) protections from government contractors and grant the [Pentagon] government purpose rights (GPR) by default over any technical data, computer software, or computer software documentation delivered to the Department [of Defense] under a contract,” they said last month.

Why it’s a problem: The policy is in direct conflict “with the existing statutory preference for specially negotiated licenses” and would create uncertainty and risk, reduce private sector innovation and result in fewer available contractors, the groups went on.

• “Intellectual property protection is inseparable from private investment,” the groups told committee leadership.
• “The confidence that IP rights will be respected is a foundational condition for attracting and retaining the private capital that fuels defense innovation.”

What should be done: There are better ways to shore up armed forces readiness.

• Continued implementation of Section 805 in the FY 2026 NDAA, which directs the Department to identify deficiencies in data rights and work with industry to address specific gaps.
• Creation of a third-party mediation body and an IP ombudsman position, also provided in the House text, would allow legitimate readiness concerns to be addressed without requiring manufacturers to forfeit the IP rights that underpin their ability to invest and innovate, the NAM and its aligned organizations said.

The last word: “Manufacturers are committed to supporting military readiness for America’s servicemembers and a strong defense industrial base depends on strong IP protections,” said NAM Vice President of Domestic Policy Jake Kuhns. “Congress should preserve policies that encourage innovation, private investment and collaboration — not provisions that make it harder for America’s manufacturers to deliver the next generation of defense technologies,”

• “When the United States rewards private investment, encourages innovation and allows manufacturers to compete freely, industry delivers unmatched results for the nation’s economy and national security.”

What’s next: The Senate is expected to vote on the FY 2027 NDAA next week.