API Specification Q1 Tenth Edition 5.6.7 Externally Owned Property

The organization shall maintain a documented procedure for control of externally (including customer) owned property that is incorporated into the product, while the property is under the organization’s control. Externally owned property shall include intellectual property and data that are not publicly available. The procedure shall address:
a) identification;
b) verification;
c) safeguarding;
d) preservation;
e) maintenance; and
f) reporting loss, damage, or unsuitability for use to the external owner.
Records for the control and disposition of externally owned property shall be maintained.

To ensure the organization has processes in place to manage externally-supplied property, ensuring it is identified, verified, protected, and safeguarded while in use.

• Receiving Inspection: Upon receipt of externally-supplied property, the organization must perform an initial inspection to verify the condition and confirm that it meets the specified requirements.
• Identification: Properly label and identify the externally-supplied property to avoid any mix-ups with the organization’s own materials or components. Labels should include information such as the external owner’s name, property description, and any relevant identifiers.
• Documentation: Maintain accurate records of all externally-supplied property, including details of receipt, inspection results, and any subsequent use or processing. These records should be easily accessible and traceable.
• Inventory Management: Use an inventory management system to track the location and status of customer-supplied property throughout its time within the organization’s control.
• Storage: Store externally-supplied property in a manner that prevents damage, deterioration, or loss. This includes using appropriate storage conditions (e.g., temperature control, humidity control) and secure storage areas.
• Handling: Ensure that externally-supplied property is handled carefully and in accordance with any specific instructions provided by the customer. Training should be provided to personnel on the proper handling procedures.
• Controlled Use: Ensure that externally-supplied property is used only for its intended purpose and in accordance with the specifications. Unauthorized use is strictly prohibited.
• Maintenance: If the externally-supplied property requires maintenance or calibration (e.g., tools, gauges), the organization must ensure that these activities are performed as per the customer’s instructions and documented appropriately.
• Damage or Loss: If any externally-supplied property is lost, damaged, or found to be unsuitable for use, the organization must immediately report this to the customer. A detailed report outlining the circumstances and any corrective actions taken should be provided.
• Externally owner’s Notification: Keep the externally owner informed about the status of their property, especially if any issues arise during its use.

Example for Managing Customer-Supplied Property

1. Receipt and Verification

1. Receiving Inspection:
   • When customer-supplied property arrives, conduct a receiving inspection to verify its condition and compliance with specifications.
   • Record the inspection results in the Receiving Inspection Log.
2. Identification:
   • Label the property with a unique identifier, including the customer’s name and any other relevant information.
   • Enter the property details into the inventory management system.

2. Storage and Handling

1. Storage:
   • Store the property in a designated area with appropriate environmental controls.
   • Ensure the storage area is secure and access is restricted to authorized personnel only.
2. Handling:
   • Train personnel on handling procedures to prevent damage or misuse.
   • Use appropriate handling equipment and techniques as per the customer’s guidelines.

3. Usage and Maintenance

1. Controlled Use:
   • Use the property only for the purpose specified by the customer.
   • Maintain records of usage, including dates and activities performed.
2. Maintenance:
   • Perform any required maintenance or calibration according to the customer’s instructions.
   • Document all maintenance activities and store records in the maintenance log.

4. Reporting and Communication

1. Damage or Loss Reporting:
   • If the property is damaged or lost, notify the customer immediately.
   • Provide a detailed report outlining the issue and corrective actions taken.
2. Regular Updates:
   • Keep the customer informed about the status of their property, especially if there are any delays or issues.

Record Keeping Example

Date	Property Description	Customer	Inspection Results	Location	Usage Details	Status	Comments
2024-05-01	High-Pressure Gauge	ABC Corp	No Defects	Storage Area 1	Used in batch 2024-HPV-B001	In Use	Calibration due 2024-06-01
2024-05-15	Special Alloy Sheet	XYZ Inc.	Minor Scratches Reported	Storage Area 2	Pending Production	In Storage	Notified customer on 2024-05-16

Control of externally (including customer) owned property that is incorporated into the product, while the property is under the organization’s control.

Controlling externally owned property, including customer-supplied property that is incorporated into the product, is crucial for ensuring quality and meeting customer requirements. The organization must establish and implement a systematic process to manage such property while it is under their control. Here’s how this can be achieved:

1. Receiving and Verification

• Inspection: Upon receipt, conduct a detailed inspection of the externally owned property to verify its condition and conformity to specifications.
• Documentation: Record the inspection results, including any discrepancies or damages, in the receiving log.
• Identification: Label the property with unique identifiers, including details such as the customer’s name, property description, and any relevant identifiers.

2. Storage and Handling

Storage

• Designated Areas: Store externally owned property in designated areas that ensure protection from damage, deterioration, or loss.
• Environmental Controls: Implement necessary environmental controls such as temperature and humidity regulation based on the property’s requirements.
• Security: Secure storage areas to restrict access to authorized personnel only.

Handling

• Training: Train personnel on proper handling procedures to prevent damage or misuse of the externally owned property.
• Equipment: Use appropriate handling equipment and techniques as specified by the customer or required by the property.

3. Incorporation into Product

• Controlled Use: Ensure the externally owned property is used only for its intended purpose and within the specified project or product.
• Documentation: Maintain detailed records of how and where the property is used in the production process. This includes logging which batch or lot the property is incorporated into.

4. Maintenance and Calibration

• Regular Checks: Perform regular checks and maintenance on the property as required by the customer or manufacturer’s guidelines.
• Calibration: Calibrate any equipment or tools supplied by the customer according to their specifications and maintain calibration records.

5. Non-Conformance Management

Reporting

• Immediate Notification: If the property is found to be non-conforming, damaged, or lost, notify the customer immediately.
• Non-Conformance Report (NCR): Generate an NCR documenting the nature of the non-conformance, corrective actions taken, and communication with the customer.

Segregation

• Quarantine Area: Segregate non-conforming externally owned property in a designated quarantine area to prevent its use until further instructions are received from the customer.

6. Record Keeping and Traceability

• Inventory Records: Maintain comprehensive inventory records for all externally owned property, tracking its status from receipt through incorporation into the final product.
• Usage Logs: Keep usage logs that detail when and how the property was used in production, including dates and personnel involved.
• Electronic Management: Utilize an electronic quality management system (QMS) for storing and managing records, ensuring easy traceability and access.

7. Communication and Feedback

• Customer Communication: Keep the customer informed about the status of their property, especially if issues arise.
• Feedback Loop: Establish a feedback loop with the customer to address any concerns and improve handling procedures.

The organization shall maintain a documented procedure

Maintaining a documented procedure for the control of externally (including customer) owned property is crucial for an oil and gas organization for several reasons:

1. Compliance with Industry Standards and Regulations
   • API Q1 and Other Standards: Compliance with API Q1 and other industry standards necessitates having documented procedures to manage externally owned property. This ensures the organization meets industry best practices.
   • Regulatory Compliance: Many regulations require detailed documentation to demonstrate that externally owned property is managed properly, ensuring legal compliance.
2. Quality Assurance
   • Consistency: A documented procedure ensures that all employees handle externally owned property in a consistent manner, which helps maintain high quality standards.
   • Product Integrity: Proper handling and control of customer property ensure that it remains in good condition and is correctly integrated into the final product.
3. Traceability and Accountability
   • Record Keeping: Detailed records provide traceability of the externally owned property through its lifecycle within the organization, from receipt to incorporation into the product or return to the customer.
   • Accountability: Clearly defined procedures help assign responsibility and accountability for the handling and management of the property.
4. Risk Management
   • Damage Prevention: Documented procedures include guidelines for the proper storage and handling of externally owned property, reducing the risk of damage or loss.
   • Issue Resolution: In case of non-conformance, documented procedures ensure that issues are promptly identified, reported, and resolved, minimizing potential impacts.
5. Customer Satisfaction
   • Trust and Confidence: Customers trust that their property is being handled professionally and safely, which enhances their satisfaction and confidence in the organization.
   • Transparency: Detailed procedures and records provide transparency, allowing customers to see how their property is managed, leading to better customer relationships.
6. Operational Efficiency
   • Streamlined Processes: Well-documented procedures streamline operations by providing clear instructions, which can improve efficiency and reduce delays.
   • Training: Documentation serves as a training resource for new employees, ensuring they understand the correct methods for handling externally owned property.
7. Continuous Improvement
   • Performance Monitoring: Documented procedures allow the organization to monitor performance and identify areas for improvement.
   • Feedback Integration: Regular updates to the procedures can incorporate feedback and lessons learned, fostering a culture of continuous improvement.

How to Maintain a Documented Procedure

1. Developing the Procedure
   • Identify Requirements: Understand and document the specific requirements of externally owned property as stipulated by industry standards, regulations, and customer agreements.
   • Define Processes: Outline clear processes for the receipt, inspection, storage, handling, incorporation into the product, maintenance, and return or disposal of externally owned property.
   • Roles and Responsibilities: Specify roles and responsibilities for each step in the process to ensure accountability and clear understanding among staff.
2. Documenting the Procedure
   • Create Detailed Instructions: Write detailed instructions for each process step, including how to handle, store, and use the property.
   • Use Clear Labels and Identification: Ensure proper labeling and identification of externally owned property to prevent mix-ups.
   • Include Checklists and Forms: Develop checklists and forms for inspections, record-keeping, and reporting non-conformances.
3. Implementing the Procedure
   • Training: Train all relevant personnel on the documented procedures to ensure they understand and follow them correctly.
   • Communication: Communicate the importance of these procedures to all staff and stakeholders involved in handling externally owned property.
4. Monitoring and Reviewing the Procedure
   • Regular Audits: Conduct regular audits to ensure compliance with the procedures and identify areas for improvement.
   • Feedback Mechanism: Implement a feedback mechanism to capture insights from employees and customers, and update the procedures accordingly.
   • Continuous Improvement: Regularly review and revise the procedures based on audit findings, feedback, and changes in regulations or customer requirements.

Externally owned property shall include intellectual property and data that are not publicly available.

Incorporating intellectual property (IP) and non-publicly available data as externally owned property into an oil and gas organization’s control procedures involves additional considerations to ensure their proper management and protection. Here’s how and why the organization should maintain a documented procedure for these types of externally owned property:

Why Maintain a Documented Procedure for Externally Owned IP and Data?

1. Compliance with Legal and Regulatory Requirements
   • Legal Protection: Proper management of IP and data ensures compliance with intellectual property laws, data protection regulations, and contractual obligations.
   • Industry Standards: Aligns with industry standards such as API Q1, which requires robust procedures for managing all forms of customer property, including IP and data.
2. Quality Assurance
   • Data Integrity: Ensures that IP and data are handled in a way that maintains their integrity and confidentiality, preventing unauthorized access or alterations.
   • Product Quality: Proper use of customer-provided IP and data can be critical to maintaining the quality and performance of products.
3. Traceability and Accountability
   • Detailed Records: Maintaining detailed records of IP and data usage provides traceability, showing how and when these resources were used in the production process.
   • Clear Responsibility: Establishes clear lines of responsibility for managing these assets, ensuring accountability within the organization.
4. Risk Management
   • Data Security: Protects against risks such as data breaches, IP theft, and unauthorized use, which can lead to significant legal and financial repercussions.
   • Non-Conformance Handling: Ensures that any issues related to IP or data, such as non-conformance or misuse, are identified and addressed promptly.
5. Customer Satisfaction
   • Trust: Demonstrates to customers that their intellectual property and data are handled with the utmost care and confidentiality, enhancing trust and satisfaction.
   • Transparency: Provides transparency to customers about how their IP and data are managed, fostering better relationships.
6. Operational Efficiency
   • Streamlined Processes: Clear procedures ensure efficient and correct handling of IP and data, reducing delays and errors.
   • Training: Documentation serves as a training resource, ensuring all relevant personnel understand how to manage these assets correctly.
7. Continuous Improvement
   • Performance Monitoring: Documented procedures allow for monitoring and improving how IP and data are managed.
   • Feedback Integration: Regular reviews and updates to the procedures can incorporate feedback and lessons learned.

How to Maintain a Documented Procedure for Externally Owned IP and Data

1. Developing the Procedure
   • Identify Requirements: Understand legal, regulatory, and customer-specific requirements for handling IP and data.
   • Define Processes: Outline processes for receiving, verifying, using, protecting, and returning or disposing of IP and data.
   • Roles and Responsibilities: Clearly define roles and responsibilities for managing IP and data within the organization.
2. Documenting the Procedure
   • Detailed Instructions: Write detailed instructions for each process step, including how to handle, store, and use IP and data securely.
   • Security Measures: Include specific security measures such as encryption, access controls, and regular audits to protect IP and data.
   • Use Checklists and Forms: Develop checklists and forms for documenting receipt, usage, and return of IP and data.
3. Implementing the Procedure
   • Training: Train all relevant personnel on the documented procedures to ensure they understand and follow them correctly.
   • Communication: Communicate the importance of these procedures to all staff and stakeholders involved in handling externally owned IP and data.
4. Monitoring and Reviewing the Procedure
   • Regular Audits: Conduct regular audits to ensure compliance with the procedures and identify areas for improvement.
   • Feedback Mechanism: Implement a feedback mechanism to capture insights from employees and customers, and update the procedures accordingly.
   • Continuous Improvement: Regularly review and revise the procedures based on audit findings, feedback, and changes in regulations or customer requirements.

Example for Control of Externally Owned IP and Data

1. Receipt and Verification

• Upon receipt, verify the completeness and accuracy of the IP and data provided.
• Document receipt in the IP/Data Log with details such as source, date, and description.

2. Storage and Handling

• Secure Storage:
  • Store IP and data in secure digital repositories with controlled access.
  • Implement encryption and other security measures to protect against unauthorized access.
• Access Control:
  • Restrict access to authorized personnel only, using role-based access controls.

3. Usage

• Controlled Use:
  • Use IP and data strictly according to customer agreements and intended purposes.
  • Maintain a usage log detailing when and how the IP and data are used.

4. Maintenance and Updates

• Regular Updates:
  • Ensure that any updates or changes to the IP and data are documented and communicated to the relevant personnel.
  • Maintain version control for all IP and data to track changes.

5. Non-Conformance Management

• Reporting Issues:
  • Immediately report any breaches, misuse, or non-conformance of IP and data to the customer.
  • Document corrective actions in the Non-Conformance Report (NCR).

6. Record Keeping and Communication

• Comprehensive Records:
  • Maintain detailed records of all activities related to externally owned IP and data.
• Customer Updates:
  • Regularly update customers on the status and usage of their IP and data.

Example Record for Externally Owned IP and Data

Date	IP/Data Description	Customer	Verification Results	Storage Location	Usage Details	Status	Comments
2024-05-01	Geological Survey Data	ABC Corp	Verified Completeness	Secure Server A	Used for Project XYZ	In Use	Access restricted to Team A
2024-05-15	Proprietary Software Code	XYZ Inc.	Verified Integrity	Secure Server B	Integrated into System ABC	In Use	Version 1.2 documented

By implementing these steps, the organization ensures effective control and protection of externally owned IP and data, maintaining high standards of quality, compliance, and customer satisfaction.

The documented procedure for control of externally (including customer) owned property that is incorporated into the product, while the property is under the organization’s control must include the identification; verification; safeguarding; preservation; maintenance; and reporting loss, damage, or unsuitability for use to the external owner.

To create a comprehensive documented process for the control of externally (including customer) owned property incorporated into the product while under the organization’s control, the following key elements must be included: identification, verification, safeguarding, preservation, maintenance, and reporting of loss, damage, or unsuitability for use to the external owner. Below is an example of a detailed procedure that incorporates these elements.

1. Identification

Procedure:

• Upon receipt of externally owned property, assign a unique identifier to each item. This could be a serial number, barcode, or any other identifiable marker.
• Label the property with its unique identifier and record relevant details (e.g., description, source, date received) in the Externally Owned Property Log.

Documentation:

• Maintain a log that includes the unique identifier, description of the property, customer details, date of receipt, and any initial observations.

2. Verification

Procedure:

• Conduct a thorough inspection of the property upon receipt to verify its condition and conformity to specified requirements.
• Document the results of the inspection, noting any discrepancies or damages observed.

Documentation:

• Inspection report detailing the condition of the property, any non-conformances, and actions taken.
• Verification checklist to ensure all aspects of the property are reviewed.

3. Safeguarding

Procedure:

• Store the property in designated, secure areas to prevent unauthorized access or tampering.
• Implement access controls such as locked storage areas, restricted access lists, and monitored access points.

Documentation:

• Storage location log specifying where each item is stored.
• Access control records detailing who has access to the property and under what conditions.

4. Preservation

Procedure:

• Ensure proper environmental conditions (e.g., temperature, humidity) are maintained to preserve the property’s integrity.
• Use protective packaging and handling procedures to prevent damage during storage and handling.

Documentation:

• Environmental monitoring records that track temperature, humidity, and other relevant conditions.
• Handling procedures document outlining the steps to safely handle and transport the property.

5. Maintenance

Procedure:

• Perform regular maintenance and calibration (if applicable) according to the property’s requirements or customer specifications.
• Document all maintenance activities, including dates, actions taken, and any issues encountered.

Documentation:

• Maintenance log detailing all maintenance and calibration activities.
• Maintenance schedule outlining the regular maintenance intervals for each item.

6. Reporting Loss, Damage, or Unsuitability

Procedure:

• Immediately report any loss, damage, or unsuitability of the property to the external owner.
• Document the incident in a Non-Conformance Report (NCR) and include details of the issue, investigation findings, and corrective actions taken.

Documentation:

• Non-Conformance Report (NCR) detailing the issue, investigation results, and corrective actions.
• Incident log to track all reported issues and their resolution.

Step-by-Step Process

1. Receipt and Identification:
   • Upon receipt of customer property, the receiving team assigns a unique identifier.
   • The property is labeled and logged into the Externally Owned Property Log.
2. Verification:
   • The quality control team inspects the property against customer specifications.
   • Inspection results are recorded, and any discrepancies are noted in the Inspection Report.
3. Safeguarding:
   • The property is stored in a designated secure area with restricted access.
   • Access control records are maintained, logging who accesses the property and when.
4. Preservation:
   • Environmental conditions are monitored and recorded to ensure they meet the property’s requirements.
   • Proper handling procedures are documented and followed to prevent damage.
5. Maintenance:
   • Regular maintenance and calibration are performed as required.
   • All maintenance activities are logged in the Maintenance Log, and a maintenance schedule is adhered to.
6. Reporting Loss, Damage, or Unsuitability:
   • Any issues are immediately reported to the customer, and a Non-Conformance Report is created.
   • The incident is logged, and corrective actions are tracked until resolution.

Example Records

Externally Owned Property Log:

Unique ID	Description	Customer	Date Received	Storage Location	Condition
001	Pressure Gauge	ABC Corp	2024-05-01	Storage Area 1	No Defects
002	Software License Key	XYZ Inc.	2024-05-15	Secure Server A	Verified Integrity

Inspection Report:

Unique ID	Description	Inspection Date	Inspector	Condition	Comments
001	Pressure Gauge	2024-05-01	John Doe	No Defects	Ready for use
002	Software License Key	2024-05-15	Jane Smith	Verified Integrity	Activated successfully

Maintenance Log:

Unique ID	Description	Maintenance Date	Technician	Actions Taken	Next Maintenance Date
001	Pressure Gauge	2024-06-01	John Doe	Calibration performed	2024-12-01
002	Software License Key	2024-05-15	Jane Smith	License renewal checked	2025-05-15

Non-Conformance Report (NCR):

NCR ID	Unique ID	Description	Date	Issue	Action Taken	Resolved	Comments
001	001	Pressure Gauge	2024-05-20	Damage during handling	Repaired and tested	Yes	Improved handling process
002	002	Software License Key	2024-05-22	Activation error	Contacted vendor	Yes	Vendor provided new key

By following this documented procedure, the organization can effectively manage externally owned property, ensuring its proper use and maintaining high standards of quality, compliance, and customer satisfaction.

Records for the control and disposition of externally owned property shall be maintained.

Maintaining accurate and comprehensive records for the control and disposition of externally owned property is critical for compliance, quality assurance, and customer satisfaction. Here are the essential records that should be maintained:

1. Externally Owned Property Log

Purpose: To track the receipt, identification, and general status of all externally owned property.

Contents:

• Unique Identifier: A unique code or number assigned to each item.
• Description: A detailed description of the property.
• Customer Information: Name and contact details of the customer or external owner.
• Date Received: The date the property was received by the organization.
• Condition Upon Receipt: Initial inspection results noting the condition of the property upon arrival.
• Storage Location: Where the property is stored within the organization.

2. Inspection Report

Purpose: To document the verification and inspection results of the externally owned property upon receipt and during its lifecycle within the organization.

Contents:

• Unique Identifier: Corresponding to the Externally Owned Property Log.
• Inspection Date: The date the inspection was carried out.
• Inspector: The name of the person who conducted the inspection.
• Condition: Detailed notes on the condition of the property.
• Comments: Any additional observations or remarks about the property.

3. Access Control Records

Purpose: To ensure that only authorized personnel handle externally owned property and to maintain a record of who accessed the property and when.

Contents:

• Unique Identifier: Corresponding to the Externally Owned Property Log.
• Person Accessing: Name of the individual accessing the property.
• Date and Time of Access: When the access occurred.
• Purpose of Access: Reason for accessing the property.
• Authorization: Confirmation that access was authorized.

4. Maintenance Log

Purpose: To track all maintenance and calibration activities performed on the externally owned property.

Contents:

• Unique Identifier: Corresponding to the Externally Owned Property Log.
• Maintenance Date: The date maintenance or calibration was performed.
• Technician: Name of the person performing the maintenance.
• Actions Taken: Description of the maintenance or calibration actions performed.
• Next Maintenance Date: Scheduled date for the next maintenance activity.

5. Non-Conformance Report (NCR)

Purpose: To document any instances of loss, damage, or unsuitability for use, including the actions taken to resolve such issues.

Contents:

• NCR ID: A unique identifier for the non-conformance report.
• Unique Identifier: Corresponding to the Externally Owned Property Log.
• Description: Description of the property and the non-conformance issue.
• Date: Date the non-conformance was identified.
• Issue: Detailed description of the problem (e.g., damage, loss).
• Action Taken: Steps taken to resolve the issue.
• Resolution Status: Whether the issue has been resolved.
• Comments: Additional notes or follow-up actions required.

6. Disposition Records

Purpose: To document the final disposition of the externally owned property, whether it is returned to the customer, incorporated into a product, or otherwise disposed of.

Contents:

• Unique Identifier: Corresponding to the Externally Owned Property Log.
• Disposition Date: The date the property was disposed of or returned.
• Disposition Method: Description of how the property was disposed of (e.g., returned to customer, scrapped).
• Customer Acknowledgment: Confirmation from the customer that the property was returned or disposed of, if applicable.
• Final Condition: The condition of the property at the time of disposition.

Summary of Records

Record Type	Contents
Externally Owned Property Log	Unique Identifier, Description, Customer Information, Date Received, Condition Upon Receipt, Storage Location
Inspection Report	Unique Identifier, Inspection Date, Inspector, Condition, Comments
Access Control Records	Unique Identifier, Person Accessing, Date and Time of Access, Purpose of Access, Authorization
Maintenance Log	Unique Identifier, Maintenance Date, Technician, Actions Taken, Next Maintenance Date
Non-Conformance Report (NCR)	NCR ID, Unique Identifier, Description, Date, Issue, Action Taken, Resolution Status, Comments
Disposition Records	Unique Identifier, Disposition Date, Disposition Method, Customer Acknowledgment, Final Condition

Example Formats

Externally Owned Property Log

Unique ID	Description	Customer	Date Received	Condition	Storage Location
001	Pressure Gauge	ABC Corp	2024-05-01	No Defects	Storage Area 1
002	Software License Key	XYZ Inc.	2024-05-15	Verified Integrity	Secure Server A

Inspection Report

Unique ID	Description	Inspection Date	Inspector	Condition	Comments
001	Pressure Gauge	2024-05-01	John Doe	No Defects	Ready for use
002	Software License Key	2024-05-15	Jane Smith	Verified Integrity	Activated successfully

Access Control Records

Unique ID	Person Accessing	Date and Time	Purpose of Access	Authorization
001	John Doe	2024-05-02 10:00 AM	Calibration Check	Authorized
002	Jane Smith	2024-05-16 2:00 PM	Software Installation	Authorized

Maintenance Log

Unique ID	Description	Maintenance Date	Technician	Actions Taken	Next Maintenance Date
001	Pressure Gauge	2024-06-01	John Doe	Calibration performed	2024-12-01
002	Software License Key	2024-05-15	Jane Smith	License renewal checked	2025-05-15

Non-Conformance Report (NCR)

NCR ID	Unique ID	Description	Date	Issue	Action Taken	Resolved	Comments
001	001	Pressure Gauge	2024-05-20	Damage during handling	Repaired and tested	Yes	Improved handling process
002	002	Software License Key	2024-05-22	Activation error	Contacted vendor	Yes	Vendor provided new key

Disposition Records

Unique ID	Description	Disposition Date	Disposition Method	Customer Acknowledgment	Final Condition
001	Pressure Gauge	2024-12-01	Returned to Customer	Acknowledged by ABC Corp	Good Condition
002	Software License Key	2025-05-15	Integrated into System	Confirmed by XYZ Inc.	Activated successfully

By maintaining these records, an organization can ensure the proper control and disposition of externally owned property, adhering to quality standards, regulatory requirements, and customer expectations.

Example of procedure for control of externally (including customer) owned property

Procedure for Control of Externally Owned Property

1. Purpose

To establish a standardized process for the identification, verification, safeguarding, preservation, maintenance, and reporting of externally (including customer) owned property while it is under the organization’s control, ensuring compliance with API Q1 requirements.

2. Scope

This procedure applies to all externally owned property received by the organization, including physical items, intellectual property, and non-publicly available data that are incorporated into products or services.

3. Responsibilities

• Receiving Department: Responsible for initial identification and verification of externally owned property upon receipt.
• Quality Control (QC) Department: Conducts inspections and maintains records of verification and non-conformance.
• Storage and Inventory Team: Manages the safeguarding, preservation, and maintenance of the property.
• Project Managers: Ensure proper usage of the property and report any issues.
• Compliance Officer: Monitors adherence to this procedure and regulatory requirements.

4. Procedure

4.1 Identification

• Assign a unique identifier to each item of externally owned property.
• Label the property with its unique identifier.
• Log the details into the Externally Owned Property Log, including the description, customer name, date received, and initial condition.

4.2 Verification

• Conduct a thorough inspection to verify the condition and conformity of the property against the customer’s specifications.
• Document the inspection results, noting any discrepancies or damages.

4.3 Safeguarding

• Store the property in designated secure areas with appropriate environmental controls.
• Implement access controls to ensure only authorized personnel can access the property.

4.4 Preservation

• Monitor and maintain appropriate environmental conditions (e.g., temperature, humidity) to preserve the property.
• Use protective packaging and handling procedures to prevent damage.

4.5 Maintenance

• Perform scheduled maintenance and calibration as per the property’s requirements or customer specifications.
• Document all maintenance activities, including dates, actions taken, and any issues encountered.

4.6 Reporting Loss, Damage, or Unsuitability

• Immediately report any loss, damage, or unsuitability of the property to the customer.
• Document the incident in a Non-Conformance Report (NCR) and include details of the issue, investigation findings, and corrective actions taken.

4.7 Disposition

• Document the final disposition of the property, whether it is returned to the customer, incorporated into a product, or otherwise disposed of.
• Obtain customer acknowledgment for the disposition.

Summary of Records

Record Type	Contents
Externally Owned Property Log	Unique Identifier, Description, Customer Information, Date Received, Condition Upon Receipt, Storage Location
Inspection Report	Unique Identifier, Inspection Date, Inspector, Condition, Comments
Access Control Records	Unique Identifier, Person Accessing, Date and Time of Access, Purpose of Access, Authorization
Maintenance Log	Unique Identifier, Maintenance Date, Technician, Actions Taken, Next Maintenance Date
Non-Conformance Report (NCR)	NCR ID, Unique Identifier, Description, Date, Issue, Action Taken, Resolution Status, Comments
Disposition Records	Unique Identifier, Disposition Date, Disposition Method, Customer Acknowledgment, Final Condition

By following this procedure, the organization can ensure the effective management, safeguarding, and reporting of externally owned property, thus meeting the requirements of API Q1.