ESA contracts and intellectual property rights Organisations working with space-related technologies can submit offers in response to calls for tenders launched by the European Space Agency (ESA). It is important for potential tenderers to study the kinds of contracts awarded by ESA, as well as the implications in terms of intellectual property rights. ESA contracts fall under the General Clauses and Conditions for ESA Contracts. This document describes the different kinds of contracts awarded by ESA according to their type of price. It makes a distinction between several kinds of contracts: fixed-price contracts (firm fixed price, fixed price with price variation or fixed unit price) ceiling price to be converted into fixed-price contracts cost reimbursement contracts (cost plus fixed fee, cost plus incentive fee, time and material). Even if most of these price types and their definitions are standardised, potential tenderers are invited to get acquainted with the detailed provisions of Annex I, in particular with clause 4 which describes the features of the cost-plus-incentive fee system, often used for major procurements, and with clause 6 dealing with allowable and non-allowable costs. ESA will only place contracts on rates that it has approved, sometimes together with national authorities. Potential bidders are regularly audited by the Cost Analysis Division. The procurement process is not finished when the contract has been signed by both parties. ESA has developed and implements a number of control and monitoring techniques to ensure that contracts are executed in full compliance with the agreed terms: technical specifications, time schedule, price etc. The first and most important element which a contract should have achieved is the establishment of a complete and clear contractual baseline. Any change to this baseline has to be subject to a formal change procedure, the modalities of which are clearly specified in the contract. The responsibility for following the timely and - in the case of cost reimbursement contracts - economical progress of the work lies with the Project Controllers. ESA expects contractors to have similar techniques and organisation - in particular qualified Project Controllers - to meet the project control requirements both in-house, and for the work subcontracted to other companies. Intellectual property rights PART II of the General Clauses and Conditions for ESA Contracts defines the special conditions applicable to Study, Experiment or Research and Development (R&D) Contracts. The potential tenderer should become familiar with this Part, since it both provides a basic definition of inventions, proprietary and non-proprietary technical data, and contains important provisions concerning the ownership and rights to use patents and other forms of legally protected data, rights of reproduction, royalties, modifications and improvements, which constitute the main elements of ESA's policy in this respect. ESA, as an R&D organisation, has a major role to play in developing and promoting European industry. Therefore it is an important element of its policy to leave the ownership of intellectual property of inventions developed to the contract partners, with the occasional exception of operational software. ESA does retain some rights to use the data for the purposes of peaceful R&D within the Member States, and the right, indeed the obligation, to distribute it to industry in Europe for such purposes. The practical implementation of this policy is sometimes complicated due to the existence of background data not generated under ESA funding, and it then becomes a matter of negotiation on a case by case basis. Furthermore, the recent development of co-funded programmes between ESA and industry or other organisations has resulted in modifications to the ESA traditional approach to intellectual property as presented above. Here again, potential tenderers should become familiar with these particular aspects which are highlighted in the provisions of the draft contract attached to each Invitation to Tender (ITT) or Request for Quotation (RFQ).