Supply Chain

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On January 2, 2025, the U.S. Department of Defense (DoD) updated the 1260H List of entities identified as “Chinese military companies” (CMC) operating in the United States, as required by section 1260H of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2021 (Section 1260H), adding new entities and removing others.  The updated 1260H List now includes 76 entities. Continue Reading New Year, Updated List: The U.S. Department of Defense Updates Its List of Chinese Military Companies with Ancillary Supply Chain and USG Contracting Impacts

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On May 30, 2024, the Department of Defense (DoD) issued a final rule implementing Section 844 of the Fiscal Year (FY) 2021 National Defense Authorization Act (NDAA) and Section 854 of the FY 2024 NDAA by amending DFARS 225.7018-2 and accompanying DFARS clause 252.225-7052, which restrict DoD from acquiring certain metals and magnets from “covered countries” of Iran, North Korea, Russia, and China, to prohibit even earlier inputs in the supply chain from occurring in these countries.  Despite comments discussing the infancy of the domestic market for many “covered materials”—defined as samarium-cobalt magnets, tantalum metals and alloys, tungsten metal powder, and tungsten heavy alloy or any finished or semi-finished component containing tungsten heavy alloy—the final rule expands the restrictions on sourcing covered materials from covered countries.  Currently, the rule requires that covered materials not be melted or produced in covered countries but, effective January 1, 2027, the updated rule prohibits covered materials being mined, refined, separated, melted or produced in one of the covered countries. The expansion of the focus of the prohibition all the way back to where these materials were mined is consistent with the U.S. government’s effort to develop the domestic industrial base for and encourage on-shoring of critical minerals, magnets, and metals.   Continue Reading DoD Expands Restrictions on Supply Chain for Certain Magnets, Tantalum, and Tungsten

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On April 1, 2024, the Department of Defense (DoD), General Services Administration (GSA), and the National Aeronautics and Space Administration (NASA) issued a final rule updating the Federal Acquisition Regulation (FAR) to add Part 40 on information security and supply chain security. This first action did not implement any new requirements; however, separate rulemakings will follow to relocate existing information security and supply chain security policies and procedures to the new Part 40. Additionally, new related regulations will be housed in Part 40. These actions suggest that the flow of information security and supply chain regulations is likely to continue unabated for at least the next few years.Continue Reading New FAR Part 40 to Address Supply Chain and Information Security Requirements

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This week’s episode covers the FAR clauses implementing the Federal Acquisition Supply Chain Security Act, updates to NASA’s Small Business Mentor Protégé Program, and DOJ’s new safe harbor policy for voluntary self-disclosures made in connection with mergers and acquisitions, and is hosted by Peter Eyre and Yuan Zhou. Crowell & Moring’s “Fastest 5 Minutes” is…

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On October 5, 2023, the Federal Acquisition Regulation (FAR) Council published an interim rule to prohibit, in the performance of a government contract, the delivery or use of “covered articles” (which includes certain information technology and telecommunications equipment, hardware, systems, devices, software, and services) subject to a Federal Acquisition Supply Chain Security Act (FASCSA) exclusion or removal order.  The interim rule also imposes obligations for a related “reasonable inquiry” at the time of proposal submission and quarterly monitoring during contract performance.  These changes implement the FASCSA of 2018 (P.L. 115-390).  While the Federal Acquisition Security Council (FASC) and the order-issuing agencies (Department of Homeland Security (DHS), Department of Defense (DoD), and the Office of the Director for National Intelligence (ODNI)) have not yet issued any such FASCSA orders, those orders will be identified in the System for Award Management (SAM) or – in some cases – identified in and specific to the contract and any resulting subcontracts.Continue Reading Coming December 4: Do You Know Where Your Supply Chain Risks Are? FAR Council Issues Interim Rule Requiring Contractor Diligence for FASC Exclusion and Removal Orders

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On June 9, 2023, the Office of Management and Budget (OMB) released M-23-16, Update to Memorandum M-22-18, which alters key deadlines and clarifies how agencies and software developers can comply with M-22-18.  The original memorandum, published in September 2022, required all federal agencies and their software developers to comply with the National Institute of Standards and Technology (NIST) Secure Software Development Framework (SSDF), NIST SP 800-218, and the NIST Software Supply Chain Security Guidance (collectively, NIST Guidance) whenever third-party software is used on government information systems or otherwise affects government information. Continue Reading Softening the Blow: OMB Extends Software Supply Chain Security Deadline and Clarifies Scope

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The National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2023, signed into law on December 23, 2022, makes numerous changes to acquisition policy. Crowell & Moring’s Government Contracts Group discusses the most consequential changes for government contractors here. These include changes that provide new opportunities for contractors to recover inflation-related costs, authorize new programs for small businesses, impose new clauses or reporting requirements on government contractors, require government reporting to Congress on acquisition authorities and programs, and alter other processes and procedures to which government contractors are subject. The FY 2023 NDAA also includes the Advancing American AI Act, the Intelligence Authorization Act for FY 2023, and the Water Resources Development Act of 2022, all of which include provisions relevant for government contractors. Continue Reading FY 2023 National Defense Authorization Act: Key Provisions Government Contractors Should Know

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Yesterday, the Office of Management and Budget (OMB) released Memorandum M-22-18, implementing software supply chain security requirements that will have a significant impact on software companies and vendors in accordance with Executive Order 14028, Improving the Nation’s Cybersecurity.  The Memorandum requires all federal agencies and their software suppliers to comply with the NIST Secure Software Development Framework (SSDF), NIST SP 800-­218, and the NIST Software Supply Chain Security Guidance whenever third-party software is used on government information systems or otherwise affects government information.  The term “software” includes firmware, operating systems, applications, and application services (e.g., cloud-based software), as well as products containing software.  It is critical to note that these requirements will apply whenever there is a major version update or new software that the government will be using. Continue Reading Going Hard on Software: OMB Unveils Mandatory Software Supply Chain Security Compliance Requirements

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Last week, the United States Congress passed the $280 billion CHIPS and Science Act of 2022 (CHIPS Act)[1] to bolster domestic semiconductor and microchip manufacturing in the United States. The bipartisan legislation will facilitate federal investments in the form of grants, loans, and loan guarantees to eligible entities and create significant business opportunities for companies in the U.S. The legislation also provides funding and new programs to boost advanced workforce training and research and development in a range of scientific and technology areas. The legislation now awaits the signature of President Biden, who hailed its passage as “exactly what we need to be doing to grow our economy right now.”

The legislation seeks to reverse the decades-long decline in U.S. microchip and semiconductor manufacturing and counter the rise of China as a source for technologically advanced manufacturing processes and products. By boosting domestic manufacturing and supply chains, the legislation also aims to relieve the global semiconductor shortage that has plagued manufacturers of a diverse set of products – everything from automobiles to children’s toys – and has contributed to the nation’s supply chain woes for more than two years.

The cornerstone of the legislation is $52 billion that will be allocated to the U.S. Department of Commerce semiconductor initiative to develop and expand domestic manufacturing capacity. Implementation of that program was already underway at the Department of Commerce[2], following Congressional authorization in the Fiscal Year 2021 National Defense Authorization Act (FY21 NDAA), and the legislation passed last week now provides the critical funding needed to commence direct federal incentives for the construction, expansion, or modernization of semiconductor manufacturing facilities. Continue Reading The CHIPS Are Down and Incentives Flow as Congress Attempts to Vitalize the U.S. Semiconductor Industry

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During December 2021, the House and Senate reached agreement on a compromise National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2022.  On December 23, 2021, Congress presented S. 1605 to President Biden, which he signed on December 27, 2021.

The FY2022 NDAA contains numerous provisions relating to acquisition policy—which provide new opportunities for government contractors, will result in the imposition of new clauses or reporting requirements on government contractors, require government reporting to Congress on acquisition authorities and programs, alter processes and/or procedures to which government contractors are subject, etc.  Crowell & Moring’s Government Contracts Group discusses the most consequential changes in the FY2022 NDAA for government contractors below.
Continue Reading National Defense Authorization Act for Fiscal Year 2022: Acquisition Policy Changes of Which Government Contractors Should Be Aware