When a U.S. institution holding an NIH grant passes some of that funding to a foreign organization to carry out part of the project, the resulting subaward sits at the intersection of two things NIH has scrutinized heavily in recent years: routine subrecipient monitoring and research security. As of 2025, NIH substantially restructured how it handles this arrangement, moving away from the traditional foreign-subaward model altogether for new awards. This page covers the current rules, the definitions that trigger them, and what changed.
What Counts as an “NIH Foreign Subaward”?
An NIH subaward is a portion of grant funds a pass-through entity (the domestic prime recipient) transfers to a subrecipient to carry out part of the substantive research described in the prime award. It becomes a “foreign subaward” when that subrecipient is a foreign organization — a university, hospital, or research institute located outside the United States, or a U.S. organization’s foreign component operating abroad.
This is distinct from, but overlaps with, NIH’s separate concept of a foreign component: performance of any significant scientific element or segment of the project outside the United States, whether by the recipient’s own staff or by a foreign collaborator, and regardless of whether NIH funds are actually spent on that element. A foreign subaward almost always creates a foreign component, but a foreign component can also exist without any subaward at all — for example, extensive data collection abroad by the prime recipient’s own staff, or human-subjects or animal work conducted at a foreign site.
It is also distinct from paying a foreign consultant or purchasing from a foreign vendor, which NIH treats as a procurement relationship rather than a subaward, and which the 2025 policy change described below does not affect.
NIH’s Foreign Component Definition
NIH’s operative definition, set out in the NIH Grants Policy Statement, is broad by design. Activities NIH treats as meeting the foreign-component threshold include: human subjects or vertebrate animal research conducted at a foreign site; extensive foreign travel by project staff for data collection, surveying, or sampling; and any recipient activity that could affect U.S. foreign policy through involvement in a foreign country’s affairs. Most substantive foreign co-authorship arrangements on funded work also qualify. Recipients must disclose foreign components both at application and whenever a material change occurs during the project period, and NIH institutes generally require prior approval before a foreign component is added to an existing award. A 2026 NIH notice reiterating this definition (NOT-OD-26-084) underscores that institutions continue to under-report foreign components relative to what the definition actually covers — this remains an active audit and compliance focus, not a settled, low-risk item.
Standard Subrecipient Monitoring: The Baseline That Still Applies
Independent of the foreign-specific rules, every NIH subaward — foreign or domestic — is subject to the general federal subrecipient-monitoring framework under 2 CFR Part 200 (the Uniform Guidance). The pass-through entity must evaluate each subrecipient’s risk, include required federal award terms in the subaward agreement, and monitor the subrecipient’s programmatic and financial performance throughout the project, consistent with subrecipient monitoring obligations generally. Subawards at or above $30,000 must also be reported under the Federal Funding Accountability and Transparency Act (FFATA); NIH’s own guidance has noted that recipients frequently under-report subawards against this threshold, making it a recurring audit finding independent of the foreign-specific issues below.
The 2023-2024 Tightening: Written Agreement and Data-Access Requirements
Ahead of the larger 2025 overhaul, NIH tightened foreign subrecipient terms through updated guidance culminating in NOT-OD-23-182. Effective for agreements executed on or after 2 January 2024, every subaward or consortium agreement with a foreign subrecipient must include a written provision giving the prime recipient access — which may be entirely electronic — to copies of all lab notebooks, all data, and all documentation supporting the outcomes described in progress reports, at a frequency no less than annually, aligned with Research Performance Progress Report timing. The same guidance made clear that institutions and principal investigators may not reclassify a foreign subrecipient as a contractor, vendor, or supplier solely to sidestep foreign-component or subaward requirements — the substance of the relationship, not the label on the agreement, controls. Subaward agreements were also required to address data ownership and disposition, NIH’s data-sharing and inventions/patent policies, and expectations around authorship, publication, and audit rights.
The 2025 Overhaul: NIH Restructures Away From Traditional Foreign Subawards
REPORTED, not independently confirmed against grants.nih.gov directly — grants.nih.gov itself returned a 403 on direct page fetch during research for this page, so the following is drawn from NIH notice NOT-OD-25-104 (1 May 2025) as summarized consistently by multiple independent institutional sponsored-programs offices (including Ohio State University, the University of North Carolina at Chapel Hill, UC Santa Cruz, Rutgers, the University of Pennsylvania, and WashU) and further corroborated by the follow-up notices NOT-OD-25-130 (implementation guidance for active awards) and NOT-OD-25-155 (12 September 2025, defining the PF5/UF5 application structure covered below). Reconfirm against the current text of these notices before relying on this section for a specific award.
Effective late September 2025, NIH stopped accepting new grant applications, renewals, and continuations that include a foreign entity as a traditional subaward or consortium participant. Prior-approval requests to add a new foreign component or foreign subaward to an ongoing project are likewise no longer being approved. In place of the subaward structure, foreign collaborations are being reorganized as independent, directly-funded subprojects under new activity codes (reported as RF2 for grants and UL2 for cooperative agreements), with each foreign partner registering and reporting separately rather than flowing through the domestic prime recipient as a subrecipient.
For awards already in place, NIH is not offering a blanket grandfathering exemption. Institutions with existing foreign subawards are expected to actively renegotiate them — in some reported cases converting a foreign component to an administrative supplement with its own separate financial reporting, particularly where human-subjects research is involved — and redirect funds domestically where a feasible alternative exists. Where a project is not viable without the foreign work and no domestic alternative exists, awards may be terminated or bilaterally renegotiated, with NIH stating that participant safety and animal welfare are considered in that process. Direct NIH awards to foreign institutions (as opposed to subawards under a domestic prime), payments to foreign consultants, and purchases from foreign vendors are reported as unaffected by this change.
Because this is an active, fast-moving policy area with real operational consequences for in-flight awards, research administrators should treat this section as a starting orientation, not a substitute for the current NOT-OD-25-104 text and direct guidance from NIH program and grants management staff, and should expect institutional sponsored-programs offices to keep publishing updated interpretations as implementation continues.
The PF5 and UF5 Activity Codes: How the New Application Structure Works
NIH’s replacement structure has a name and a specific pair of activity codes attached to it. Per NIH Notice NOT-OD-25-155 (issued 12 September 2025), competing grant applications that include one or more foreign components must respond to a funding opportunity supporting one of two new activity codes: PF5 (Collaborative International Research Project) for standard research grants, or UF5 (Collaborative International Cooperative Agreement) for cooperative agreements and other complex mechanisms. In both cases the primary applicant organization must be domestic, and the application must include at least one foreign subproject.
A PF5 or UF5 application is built from at least three linked components: an Overall component addressing the collaboration’s shared objectives, a Research Project component covering the domestic side’s scientific and technical work, and one or more International Project components, each addressing a single foreign collaborator’s role. An application with foreign collaborators at more than one institution includes a separate International Project component for each one.
On award, NIH issues two linked but administratively independent awards rather than a single award with a nested subaward: a PF5 (grant) or UF5 (cooperative agreement) to the domestic applicant organization, and a companion RF2 (grant) or UL2 (cooperative agreement) directly to each foreign collaborating organization. The foreign award is budgeted, tracked, and reported separately from the domestic one — this is the mechanism NIH has described as closing the oversight gap in the traditional subaward model, since NIH gains its own direct financial-reporting relationship with the foreign organization instead of relying entirely on the domestic prime recipient to monitor a subrecipient it may have limited practical ability to audit.
Effective date: per NOT-OD-25-155, competing applications with a due date on or after 25 January 2026 that request NIH funding for one or more foreign components must use the PF5/UF5 structure, submitted in response to a funding opportunity announcement that supports it. This builds on the broader restriction NIH first announced in NOT-OD-25-104 (1 May 2025) and the implementation guidance for already-active awards in NOT-OD-25-130 — read together, in that order, the three notices are the current authoritative sequence on this policy.
Foreign components that do not involve a subaward or consortium relationship — a foreign consultant, international travel for data collection by the recipient’s own staff, purchases from a foreign vendor — are not required to use the PF5/UF5 structure and may continue to be supported through ordinary activity codes, unless a specific funding opportunity states otherwise.
Why NIH Changed Course: The Research-Security Context
This shift did not happen in isolation. It follows several years of intensifying federal attention to research security — the risk that federally funded research, personnel, or data could be diverted, undisclosed, or exploited through undeclared foreign affiliations. That attention traces in part to findings summarized in the JASON report on research security, continued concern over foreign talent recruitment programmes and undue foreign influence, and the disclosure and program requirements that flow from NSPM-33 and the broader research security policy framework federal agencies have been implementing. A subaward to a foreign entity is, from a research-security standpoint, exactly the kind of arrangement that has drawn the most scrutiny: it moves federal funds and, often, data and materials outside U.S. institutional oversight while NIH itself has limited direct visibility into the foreign organization’s own controls. Restructuring foreign work as separately-registered, directly-accountable subprojects is one way NIH has reported addressing that visibility gap, rather than relying on the domestic prime recipient to monitor a subrecipient it may have limited practical ability to audit.
What This Means for Research Administrators
- New applications: Do not propose a traditional foreign subaward or consortium agreement in a new NIH application. Confirm with the relevant NIH institute or center how foreign collaboration should be structured under the current guidance before submission.
- Existing awards with foreign subawards: Inventory every active foreign subaward across your institution’s NIH portfolio now. Confirm with your NIH program officer and grants management specialist whether renegotiation, an administrative supplement, or termination applies to each one, and do not assume any award is grandfathered without direct confirmation.
- Subaward agreements still in force: Confirm the 2 January 2024 lab-notebook/data-access provision is present in every foreign subaward agreement executed on or after that date, and that no foreign subrecipient has been reclassified as a contractor to avoid foreign-component or subaward obligations.
- Foreign component disclosure: Re-audit active and pending awards against NIH’s foreign-component definition — it is broader than “subaward,” and NIH’s own 2026 reminder notice signals continued under-reporting is an audit focus.
- Documentation: Because this area is changing faster than most institutional policy documents can track, cite the specific NIH notice number and date whenever documenting a compliance decision internally, and revisit that documentation on a defined cycle (for example, each time a new NIH policy notice is issued) rather than treating a one-time review as sufficient.
Frequently Asked Questions
What is a “foreign component” under NIH policy?
Performance of any significant scientific element or segment of an NIH-funded project outside the United States, by the recipient’s own staff or a foreign collaborator, whether or not NIH funds are spent on that element. It is a broader concept than “foreign subaward” — a foreign component can exist without any subaward being involved.
Can NIH grantees still work with foreign collaborators at all?
Yes, but reportedly not through the traditional foreign-subaward or consortium structure for new applications and renewals as of late 2025. Foreign collaboration is being restructured as an independent, directly-funded subproject arrangement rather than a subaward flowing through the domestic prime recipient. Direct NIH awards to foreign institutions, foreign consultants, and foreign vendor purchases are reported as unaffected.
Does the new policy apply to subawards that are already in place?
Reportedly yes, though not through automatic grandfathering — institutions with existing foreign subawards are expected to actively renegotiate them with NIH, potentially converting the foreign work to a separately-reported supplement, and some non-viable arrangements may face termination or renegotiation. Confirm the current status of any specific award directly with NIH grants management staff.
What is the FFATA reporting threshold for NIH subawards?
Subawards of $30,000 or more must be reported under the Federal Funding Accountability and Transparency Act, consistent with NIH Grants Policy Statement guidance on subaward reporting — a requirement independent of, and in addition to, the foreign-specific rules above.
Do foreign subrecipients have to share their raw data and lab notebooks?
For subaward agreements executed on or after 2 January 2024, yes: NIH requires a written provision giving the prime recipient at least annual access — which may be entirely electronic — to all lab notebooks, data, and documentation supporting the results reported in progress reports.
Is a foreign consultant or vendor the same as a foreign subrecipient?
No. A subrecipient is substantively different from a contractor or vendor under federal rules, and NIH guidance explicitly prohibits reclassifying a foreign subrecipient as a contractor solely to avoid subaward or foreign-component obligations. The relationship’s substance — who is carrying out substantive programmatic work versus providing goods or services — determines which category applies, not how the agreement is labeled.
What are the PF5 and UF5 activity codes?
PF5 (Collaborative International Research Project) and UF5 (Collaborative International Cooperative Agreement) are the NIH activity codes, introduced in NOT-OD-25-155, that domestic applicants use when an application includes one or more foreign components. They replace the traditional foreign-subaward structure: NIH issues the PF5/UF5 award to the domestic organization and a linked RF2 (grant) or UL2 (cooperative agreement) award directly to each foreign collaborating organization, rather than nesting the foreign work as a subaward inside a single domestic award.
When do NIH’s new PF5/UF5 application requirements take effect?
For competing applications, the PF5/UF5 structure is required for due dates on or after 25 January 2026 when the application requests NIH funding for one or more foreign components, per NOT-OD-25-155. The broader restriction on new traditional foreign subawards took effect earlier, with NOT-OD-25-104 on 1 May 2025.
