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Defense Logistics Agency: Small Businesses Participate in Reverse Engineering of Spare Parts


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The Department of Defense spends tens of billions of dollars annually to sustain military assets including aircraft, ships, and missiles. In support of this effort, DLA strives to maintain a competitive supplier base through reverse engineering - the process of examining an item, such as a spare part, with the intent of replicating its design. Contractors consider intellectual property, such as their technical data and patented material, essential to their success. DLA also takes steps to safeguard contractors' intellectual property during reverse engineering. The Senate Armed Services Committee report accompanying a bill for the fiscal year 2018 National Defense Authorization Act included a provision for GAO to review DLA's reverse engineering efforts, including the protection of small businesses' intellectual property. This report describes (1) DLA's reverse engineering programs and the extent to which small businesses participated in these programs from fiscal years 2015 through 2018; and (2) how DLA safeguards certain intellectual property within its reverse engineering efforts. GAO analyzed data from three DLA commands - Aviation, Land and Maritime, and Troop Support, those that conduct reverse engineering - from fiscal years 2015 through 2018. GAO reviewed a nongeneralizable sample of 19 reverse engineering projects involving 13 parts, selected to include a variety of characteristics, such as the size of the contractors involved. GAO reviewed DLAs guidance and interviewed DLA officials and representatives from small businesses about safeguarding intellectual property as part of reverse engineering.



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