Tracye Howard Discusses New Rule Barring Contractors from Supplying Communications Equipment Manufactured in China to Federal Agencies

August 30, 2019

Wiley Rein National Security Practice co-chair and Government Contracts Practice partner Tracye Howard was quoted in an August 29 Corporate Counsel - Law.com article about a new interim federal rule that took effect under the Federal Acquisition Regulation (FAR). Effective Aug. 13, the rule bars contractors from supplying the U.S. federal government with telecom and video surveillance equipment from several Chinese manufacturers.

Contractors supplying specific electronics to federal agencies risk losing contracts, the right to bid on contracts, or may be found liable under the False Claims Act if found in violation of the new rule. The regulation implements part of the National Defense Authorization Act of 2019 which overhauled the national security review process for investments in domestic companies.

Ms. Howard provided three “tips” to in-house counsel for companies affected by the FAR rule. She encouraged these companies to (1) be alert for modifications to contracts, (2) analyze the supply chain to the lowest tiers to see if prohibited products are incorporated, and (3) be aware that the FAR provisions are being implemented in part through the System for Award Management (SAM).

In-house counsel should ensure that “individuals filling out annual certifications under SAM are knowledgeable about the issue and have the benefit of the company’s due diligence so they can accurately answer the questions,” added Ms. Howard.

The article can be found here (subscription required).