10 U.S.C. § 3762 - U.S. Code - Unannotated Title 10. Armed Forces § 3762. Independent research and development costs: allowable costs

(a)Regulations.--The Secretary of Defense shall prescribe regulations governing the payment by the Department of Defense of expenses incurred by contractors for independent research and development costs. Such regulations shall provide that expenses incurred for independent research and development shall be reported independently from other allowable indirect costs.

(b)Costs treated as fair and reasonable, and allowable, expenses.--The regulations prescribed under subsection (a) shall provide that independent research and development costs shall be considered a fair and reasonable, and allowable, indirect expense on Department of Defense contracts.

(c)Additional controls.--Subject to subsection (d), the regulations prescribed under subsection (a) may include the following provisions:

(d)Limitations on regulations.--Regulations prescribed under subsection (a) may not include provisions that would infringe on the independence of a contractor to choose which technologies to pursue in its independent research and development program if the chief executive officer of the contractor determines that expenditures will advance the needs of the Department of Defense for future technology and advanced capability as transmitted pursuant to subsection (c)(2)(A).

(e)Effective date.--The regulations prescribed under subsection (a) shall apply to indirect costs incurred on or after October 1, 2017.