A DoD New Year’s Resolution: No More Chinese (and Possibly Russian) Products and Services in Support of Key Missions

Justin A. Chiarodo and Robyn N. Burrows

A very Happy New Year to our GovCon Navigator readers! Further expanding recent supply chain restrictions across federal procurement, the Department of Defense (“DoD”) issued an interim rule prohibiting DoD from procuring equipment or services from certain Chinese entities (and possibly Russian) if used to carry out DoD nuclear deterrence or homeland defense missions. The rule builds on the Section 889 supply chain restrictions we previously covered in a prior blog post.

What should contractors do now given the interim rule is already in effect? Contractors should first evaluate their existing contract portfolios for covered missions and take immediate steps to eliminate all covered products from their supply chain (and find alternate sources of supply). If the rule might impact contract performance, you should be prepared to address this with the appropriate counterparty. And given the requirement for compliance certifications that mirror Section 889, contractors should also harmonize monitoring and compliance with their existing supply chain compliance programs. Among other things, this should address the requirement to obtain compliance certifications from downstream subcontractors and suppliers.

Read on for the specifics. Continue reading “A DoD New Year’s Resolution: No More Chinese (and Possibly Russian) Products and Services in Support of Key Missions”

5 Tips for Complying with New Section 889 Supply Chain Regulations

Justin A. Chiarodo and Robyn N. Burrows

As part of a recent wave of supply chain requirements, Section 889 of the 2019 National Defense Authorization Act (“NDAA”) imposed major new limitations on the use of certain Chinese telecommunications products and services in federal procurement, and recent implementing regulations mandate a range of compliance actions relating to the ban. This blog post provides practical guidance on the new rules and five compliance tips.

Ban against Procuring “Covered Telecommunications Equipment or Services”

The Department of Defense (“DoD”), General Services Administration (“GSA”), and National Aeronautics and Space Administration (“NASA”) recently released an interim rule implementing the first part of Section 889. This ban, which became effective August 13, 2019, sweeps broadly by prohibiting agencies from procuring the following “covered telecommunications equipment or services”:

  1. Telecommunications equipment produced by Huawei and ZTE Corporation;
  2. Video surveillance and telecommunications equipment used for public safety, surveillance of “critical infrastructure,” or national security purposes and produced by Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, or Dahua Technology Company;
  3. Telecommunications or video surveillance services provided by such entities for any purpose; or
  4. Telecommunications or video surveillance equipment produced or provided by an entity that the Secretary of Defense determines is owned or controlled by, or otherwise connected to, the government of the People’s Republic of China.

The ban includes all affiliates and subsidiaries of the listed companies. Continue reading “5 Tips for Complying with New Section 889 Supply Chain Regulations”