Domestic sourcing requirements are not new, but the Government is always developing new tools for increasing the sourcing of goods from the U.S. and allied countries. Both sides of the political aisle have marched to a drumbeat of increased domestic sourcing for the past several years. Most recently, the Biden Administration implemented Executive Order 14005
Following our recent overview of key topics to watch in the National Defense Authorization Act (“NDAA”) for Fiscal Year (“FY”) 2024, available here, we continue our coverage with a “deep dive” into NDAA provisions related to the People’s Republic of China (“China” or “PRC”) in each of the House and Senate bills. DoD’s focus on strengthening U.S. deterrence and competitive positioning vis-à-vis China features prominently in the 2022 National Defense Strategy (“NDS”) and in recent national security discourse. This focus is shared by the Select Committee on Strategic Competition Between the United States and the Chinese Communist Party (“Select Committee”), led by Chairman Mike Gallagher (R-WI) and Ranking Member Raja Krishnamoorthi (D-IL).
It is no surprise, then, that House and Senate versions of the NDAA include hundreds of provisions—leveraging all elements of national power—intended to address what the NDS brands as China’s “pacing” challenge, including many grounded in Select Committee policy recommendations. Because the NDAA is viewed as “must-pass” legislation, it has served in past years as a vehicle through which other bills not directly related to DoD are enacted in law. In one respect, this year is no different—the Senate version of the NDAA incorporates both the Department of State and Intelligence 2024 Authorization bills, each of which includes provisions related to China.
Continue Reading Not to Be Outpaced: NDAA Presents Measures Addressing China
It’s that time of year again: the House and Senate have each passed their respective version of the National Defense Authorization Act for FY 2024 (“NDAA”) (H.R. 2670, S. 2226). The NDAA is a “must pass” set of policy programs and discretionary authorizations to fund Department of Defense (“DoD”) operations. Lawmakers are currently undertaking the arduous process of reconciling these bills, while jockeying to include topics of importance in the final legislation. The engrossed bills contain a number of significant provisions for defense contractors, technology providers, life science companies and commercial-item contractors – many of which we discuss briefly below and others that we will analyze in more depth in our NDAA series in the coming weeks. Subscribe to our blog here so that you do not miss these updates.
Continue Reading Key Topics to Watch as Congress Works to Fund Next Year’s DoD Budget
As the House and Senate Armed Services Committees prepare to mark up the Fiscal Year 2024 National Defense Authorization Act (NDAA), they are very likely to consider a number of China-related measures that have been recommended by the national security community and which could enjoy bipartisan support. These recommendations are generally focused on countering Chinese influence in the United States or increasing the United States’ relative power advantage in the Pacific region.
The Department of Defense is seeking early input on implementation of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 (the “FY2023 NDAA”) in the Federal Acquisition Regulation and Defense Federal Acquisition Regulation. Although this early engagement process will not replace the formal rulemaking process, it presents a significant opportunity for government contractors, technology providers, industry associations, and other interested parties to provide their perspectives on acquisition-related provisions of this year’s NDAA. Providing early input can ensure that industry’s perspective is heard. Indeed, providing input at this stage may impact the future rulemaking process by guiding areas of focus and influencing ways the rule makers ask for input during the rulemaking process.
Continue Reading DoD Seeks Early Input Regarding FY2023 NDAA Implementation in Acquisition Regulations
On December 23, 2022, President Biden signed the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 (the “FY2023 NDAA”) into law. As described in Covington’s Client Alert, FY23 NDAA: Provisions of Interest for Almost All Government Contractors, the FY23 NDAA contains provisions of interest for almost all U.S. Government contractors. One provision likely to be of particular interest to U.S. contractors who provide or plan to provide cloud computing services to the U.S. Government is the FedRAMP Authorization Act (the “Act”), which codifies the Federal Risk and Authorization Management Program (“FedRAMP”).
Of note, the Act creates a “presumption of adequacy” that cloud providers with authorization from one agency can use that authorization with other agencies. This is an expansion compared to the current process which allows authorizations by the FedRAMP Joint Authorization Board, but not authorizations from individual agencies, to serve as the basis for an agency’s own authorization process. It also creates the Federal Secure Cloud Advisory Committee, comprised of 15 members of the public and private sector, to provide recommendations regarding FedRAMP and the acquisition of cloud services more generally.
Continue Reading FY2023 NDAA Makes Notable Changes to FedRAMP Program
This is the fifteenth in a series of Covington blogs on implementation of Executive Order 14028, “Improving the Nation’s Cybersecurity,” issued by President Biden on May 12, 2021 (the “Cyber EO”). The first blog summarized the Cyber EO’s key provisions and timelines, and the subsequent blogs described the actions taken by various Government agencies to implement the Cyber EO from June 2021 through June 2022. This blog describes key actions taken to implement the Cyber EO during July 2022.
Continue Reading July 2022 Developments under President Biden’s Cybersecurity Executive Order
On August 25, 2022, the Department of Defense (“DOD”) published — with immediate effect — two new Defense Federal Acquisition Regulation Supplement (“DFARS”) clauses requiring defense prime contractors and subcontractors disclose any work in China on certain DOD contracts. Under the interim rule, the DOD is prohibited from awarding or extending certain new contracts if a contractor fails to disclose its use of workers in China in performance of a covered DOD contract. Although there is no prohibition on DOD awarding a covered contract to an entity that makes a disclosure, the Department can rely on a variety of authorities to exclude certain contractors and products that represent supply chain risks, especially if the products or services involve information technology.
Continue Reading New DFARS Clauses Require Defense Contractors to Disclose Work Performed in China
Earlier today, the FAR Council issued a final rule revising the FAR definition of “commercial item.” The final rule effectively splits the prior definition of “commercial item” into separate definitions for “commercial product” and “commercial service,” without making substantive changes to the existing definitions. The final rule also replaces references to “commercial items” throughout the FAR with corresponding references to “commercial products,” “commercial services,” or both, as appropriate.
Continue Reading New Final Rule Replaces “Commercial Item” Definition and Implements Definitions for “Commercial Products” and “Commercial Services”
On August 13, 2020, the Office of Management and Budget (OMB) released new revisions to its Guidance for Grants and Agreements set forth under 2 CFR (commonly referred to as the Uniform Guidance). The Uniform Guidance governs the terms of federal funding issued by agencies, including grants, cooperative agreements, federal loans, and non-cash assistance awards.