💡 Plain English Explanation

Security clearance clauses establish obligations related to personnel security clearances when an NDA involves access to classified national security information. These provisions address who can access classified information, verification procedures, maintenance of clearance status, and reporting obligations.

Personnel security clearances (Confidential, Secret, Top Secret, and various SCI compartments) are granted by the federal government after extensive background investigations. The clearance process can take months to years, and maintaining a clearance requires ongoing compliance with security requirements.

Key clearance-related obligations include:

⚠ Why This Clause Matters

For the Disclosing Party: Proper clearance verification protects classified information from unauthorized disclosure. Sharing classified information with uncleared personnel is a federal crime that can result in criminal prosecution, loss of contracts, and facility clearance revocation.

For the Receiving Party: Clear understanding of clearance requirements helps you plan staffing and avoid costly delays. Clearance investigations take time, and you need to know whether you can actually perform under the agreement with your current personnel.

Legal Framework: Security clearances are governed by Executive Order 13526, the National Industrial Security Program Operating Manual (NISPOM/32 CFR Part 117), and agency-specific security regulations. Violations can result in criminal penalties under 18 U.S.C. 793-798 (Espionage Act provisions).

📄 Clause Versions

Balanced Version: Standard clearance verification and access control requirements that align with NISPOM requirements. Appropriate for most classified contracts between cleared facilities. 
SECURITY CLEARANCE REQUIREMENTS

1. Facility Clearance. The Receiving Party represents and warrants that it holds a valid Facility Clearance (FCL) at the [SECRET/TOP SECRET] level, as verified in the National Industrial Security System (NISS), and that such clearance permits the storage and handling of classified information at the level required for the Purpose.

2. Personnel Security Clearances. The Receiving Party shall ensure that all personnel who will have access to classified information disclosed under this Agreement:
   (a) Hold an active personnel security clearance at or above the classification level of the information to be accessed;
   (b) Have a verified need-to-know for the specific classified information;
   (c) Have been briefed on their security responsibilities; and
   (d) Have executed all required classified information non-disclosure agreements (SF-312 or equivalent).

3. Clearance Verification. Prior to any disclosure of classified information, the Disclosing Party shall verify the Receiving Party's facility clearance and the personnel clearances of individuals who will access such information through the appropriate government security database or the Defense Counterintelligence and Security Agency (DCSA).

4. Access Limitations. The Receiving Party shall not permit access to classified information by any individual whose clearance has been suspended, revoked, or administratively withdrawn, or who is the subject of a current security investigation that may affect clearance status.

5. Reporting Obligations. The Receiving Party shall promptly notify the Disclosing Party of:
   (a) Any change in the Receiving Party's facility clearance status;
   (b) Any adverse action affecting the clearance of personnel with access to the Disclosing Party's classified information;
   (c) Any security incidents or potential compromises involving classified information; and
   (d) Any contact by foreign nationals or suspicious activity as required by NISPOM.

6. Derivative Classification. Any documents or materials created by the Receiving Party that derive from or incorporate classified information shall be marked and protected at the appropriate classification level in accordance with the source document markings and applicable classification guides.
Disclosing Party Favor: Enhanced verification, continuous monitoring, and broader reporting requirements. Includes provisions for access revocation and audit rights. 
SECURITY CLEARANCE REQUIREMENTS

1. Facility Clearance Representation. The Receiving Party represents and warrants that:
   (a) It holds a valid Facility Clearance (FCL) at the [SECRET/TOP SECRET] level;
   (b) The FCL has not been suspended, revoked, or subject to any adverse administrative action;
   (c) It maintains compliance with all NISPOM requirements (32 CFR Part 117);
   (d) It has adequate secure storage capability for the anticipated volume of classified information; and
   (e) It will maintain such FCL throughout the term of this Agreement.

2. Personnel Clearance Verification. Prior to any access to classified information:
   (a) The Receiving Party shall provide the Disclosing Party with a list of personnel proposed for access, including name, clearance level, and date of last investigation;
   (b) The Disclosing Party shall independently verify each individual's clearance status through DISS/NISS;
   (c) The Disclosing Party shall approve, in writing, each individual before access is granted; and
   (d) No individual shall access classified information without such prior written approval.

3. Need-to-Know Certification. For each individual requiring access, the Receiving Party shall certify in writing:
   (a) The specific classified information categories to be accessed;
   (b) The business justification establishing need-to-know;
   (c) The duration of required access; and
   (d) The secure location where access will occur.
The Disclosing Party reserves the right to deny or revoke access determinations in its sole discretion.

4. Continuous Monitoring. The Receiving Party shall:
   (a) Monitor all cleared personnel enrolled in the Continuous Evaluation (CE) program;
   (b) Review CE alerts within twenty-four (24) hours of receipt;
   (c) Immediately suspend access for any individual subject to an adverse CE alert;
   (d) Report all CE alerts affecting personnel with access to Disclosing Party's information; and
   (e) Conduct annual security refresher training for all personnel with access.

5. Expanded Reporting. The Receiving Party shall notify the Disclosing Party within twenty-four (24) hours of:
   (a) Any change in facility clearance status, including pending actions;
   (b) Any adverse information concerning cleared personnel (arrests, financial problems, foreign contacts, etc.);
   (c) Any security violations or incidents, whether confirmed or suspected;
   (d) Any unauthorized access or potential compromise;
   (e) Personnel departures, terminations, or clearance lapses; and
   (f) Any inquiry from a foreign government or foreign national.

6. Access Revocation. The Disclosing Party may immediately revoke any individual's access to classified information for any reason, including security concerns, without prior notice. The Receiving Party shall comply with all revocation instructions within four (4) hours of notification.

7. Security Audits. The Disclosing Party and its designated security representatives shall have the right to conduct announced or unannounced security audits of the Receiving Party's facilities, personnel, and procedures related to classified information handling.

8. Indemnification. The Receiving Party shall indemnify and hold harmless the Disclosing Party from all claims, damages, fines, and penalties arising from security violations attributable to the Receiving Party's personnel or facilities.
Receiving Party Favor: Standard NISPOM compliance with reasonable verification procedures and mutual cooperation. Limits unilateral access revocation and audit intrusiveness. 
SECURITY CLEARANCE REQUIREMENTS

1. Mutual Clearance Verification. Both parties represent that they hold valid Facility Clearances at the level required for the Purpose, as reflected in the National Industrial Security System. Each party shall cooperate with the other's reasonable verification requests.

2. Standard Personnel Clearance Requirements. Personnel accessing classified information shall:
   (a) Hold an active security clearance at or above the classification level of the information;
   (b) Have a need-to-know as determined by their employing party; and
   (c) Have executed the required SF-312 or equivalent non-disclosure agreement.
Clearance verification shall be conducted through standard government channels (DISS/NISS) in accordance with normal procedures.

3. Need-to-Know Determination. The Receiving Party shall be responsible for making need-to-know determinations for its own personnel, consistent with the Purpose and scope of this Agreement. The Disclosing Party may request, but not unreasonably withhold, concurrence on need-to-know determinations.

4. Standard Reporting. The Receiving Party shall report security incidents and clearance status changes in accordance with NISPOM requirements and timelines. Routine reporting shall be made to the Disclosing Party's designated security representative within the timeframes specified in 32 CFR Part 117.

5. Access Decisions. If either party believes an individual should be denied access for security reasons:
   (a) The concerned party shall provide written notice specifying the security concern;
   (b) The other party shall have ten (10) business days to respond or propose alternatives;
   (c) If the concern cannot be resolved, access shall be limited to other cleared personnel; and
   (d) Neither party may unilaterally terminate this Agreement based solely on individual access disputes.

6. Facility Inspections. Government security inspections shall be conducted pursuant to NISPOM. The Disclosing Party may request to accompany government inspectors during inspections related to its classified information, subject to government approval. Private security reviews require thirty (30) days advance notice and shall not unreasonably interfere with operations.

7. Clearance Processing Support. If the Receiving Party needs to process clearances for additional personnel, the Disclosing Party shall provide sponsorship and reasonable assistance, including visit authorization letters, within ten (10) business days of request.

8. Limitation of Liability. Neither party shall be liable for delays or performance failures caused by government clearance processing timelines, provided that the affected party uses reasonable efforts to expedite clearance actions and provides timely updates on status.

💬 Key Considerations