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Globalization of Materials R&D: Time for a National Strategy
inventions to the commercial market. The legislation was designed to address problems with the ownership of technology and inventions resulting from federally funded research performed at colleges and universities and the apparent reluctance on the part of industry to invest in the further development and manufacture of technology that rarely made it to market. The Bayh-Dole Act allows universities and small businesses to take title to the inventions, encouraging further development and manufacture. There are two requirements of the Act. First, the invention must be patented in order for the university or small business to take title to it. Second, any manufacture of the product must be substantially performed in the United States. A waiver to this requirement can be obtained if, after a reasonable search, no manufacturer can be found or if manufacture in the United States is economically unfeasible.
These requirements can hinder meaningful international participation, and once the result of the research is patented, the related research is no longer basic. If the technology is subject to export controls, this affects further R&D in the United States, because any students involved would have to be either U.S. citizens or their work covered by an export license or other export authority. More significantly, the Act prohibits manufacture outside the United States, which makes corporations unable to consider offshore outsourcing for technology covered by the legislation. Critics of this aspect of the legislation say it effectively puts potential developers or users of federally funded university research in the same situation they were in before 1980.
The end result of these requirements is that industry might be reluctant to engage in federally funded industry-academia alliances in the United States and more favorably inclined to consider such alliances with non-U.S. universities funded by foreign governments, subject to local regulations of course.
The primary sources of export regulation—the Department of State’s International Traffic in Arms Regulations (ITAR) and the Department of Commerce’s Export Administration Regulations (EAR)—are considered by some in industry as a barrier to the global conduct of business. To compete in the global market and maintain a comparative advantage, U.S. industry must have access to both domestic and foreign technology, and manufacturing and export controls could be considered as hindering this access. Critics of the current export regulation regime maintain that foreign companies are executing contracts while U.S. companies are still seeking regulatory approval.
Over the past 20 years most congressional activity on the export regimes has been to add sanctions and restrictions rather than to substantively review the