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Continuing developments on the supply chain front

March 22, 2021 By Nancy Cleveland

Recent weeks have brought news on multiple fronts regarding supply chain risks and actions in response thereto:

Commerce ICTS Regulations to Go Into Effect; Chinese ICTS Companies, Products, and Services in the Headlights

The Trump Administration rolled out regulations to implement prohibitions on the use or delivery of covered Chinese telecommunications and video surveillance products and services.  Additionally, its Department of Commerce had engaged in rulemaking to implement processes and procedures for identifying supply chain risks posed by Chinese Information and Communications Technology Sector (ICTS) companies, products, and services.  The Biden Administration has come to town and many have wondered what is going to happen to this rulemaking when it becomes effective in March 2021.  Law360 quotes the new Secretary of Commerce as saying “The Biden-Harris administration has been clear that the unrestricted use of untrusted ICTS poses a national security risk…Beijing has engaged in conduct that blunts our technological edge and threatens our alliances.”  For those wondering whether the Biden Administration will continue its tough stance on Chinese ICTS, China and ICTS remain a target of potential enforcement activities under the Biden Administration: “The administration is firmly committed to taking a whole-of-government approach to ensure that untrusted companies cannot misappropriate and misuse data and ensuring that U.S. technology does not support China’s or other actors’ malign activities.”  The Administration has backed up these words with actions, applying the Commerce rules to issue subpoenas to Chinese ICTS firms to further assess the risks they pose to the supply chain.  However, the Administration is also holding talks with China this week and one wonders whether and to what extent this action is intended to impact that discussion.

Continue reading at:  Government Contracting Matters

Filed Under: Contracting News Tagged With: China, foreign governments, ICTS rule

Software review provisions proposed by Senate Armed Services Committee could have significant impact on DoD contractors

June 20, 2018 By Nancy Cleveland

As the Senate approaches the end of its debate on the National Defense Authorization Act (NDAA) for Fiscal Year 2019, provisions of the bill regarding access to and review of information technology code deserve close attention.  These sections, if enacted, would significantly impact Department of Defense contractors and also would affect matters associated with investments subject to review by U.S. national security agencies.

As drafted, the provisions could expose current and prospective contractors to intrusive scrutiny and significant risks.  They lack clarity on key definitions, leaving the precise scope of those risks unclear.  We summarize major issues and concerns below.  We expect these provisions to receive scrutiny during the House-Senate conference on the NDAA over the summer.

Synopsis of the Proposed Legislation

Three sections of the Senate’s version of the NDAA, which passed the Senate Armed Services Committee in May, would establish new rules designed to mitigate “risks posed by providers of information technology with obligations to foreign governments.”  Those risks involve the access that foreign governments may have to code in products or services that are offered to the Department of Defense.  The provisions also impose new disclosure requirements on the efforts of a prospective vendor to obtain a license under the Export Administration Regulations (“EAR”) or the International Traffic in Arms Regulation (“ITAR”).

The pending legislation would require proactive disclosure of those matters, and would impose an ongoing duty to supplement those disclosures during the period of performance on the contract.  The Secretary of Defense would be authorized to assess and mitigate any resulting national security risks through contractual provisions or other performance requirements.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2018/06/senate-armed-services-committee-proposes-expansive-unclear-software-review-provisions/

Filed Under: Contracting News Tagged With: code, COTS, cybersecurity, data security, DoD, EAR, export administration regulations, foreign governments, IT, ITAR, national security, NDAA, risk, risk assessment, Senate Armed Services Committee, technology

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