(a) The contractor may dispose of scrap resulting from production or testing under this contract without Government approval. However, if the scrap requires demilitarization or is sensitive property, then the contractor shall submit the scrap on an inventory disposal schedule.
(b) For scrap from other than production or testing, the contractor may prepare scrap lists in lieu of inventory disposal schedules (provided such lists are consistent with the approved scrap procedures).
(c) Inventory disposal schedules shall be submitted all aircraft regardless of condition, flight safety critical aircraft parts, and scrap that-
(1) Requires demilitarization;
(2) Is a classified item;
(3) Is generated from classified items;
(4) Contains hazardous materials or hazardous wastes;
(5) Contains precious metals that are economically beneficial to recover; or
(6) Is dangerous to the public health, safety, or welfare.
