In December 2025, Section 1826 of the FY 2026 NDAA created one of the most valuable classifications in defense contracting and most companies that qualify don’t know it yet. Qualify as a “nontraditional defense contractor” and you’re exempt from certified cost or pricing data, FAR Part 31, and the entire DFARS business-systems architecture. The kicker?
Why a clean name-match screen is no longer enough, and why the diligence meant to find hidden China exposure can create risk on the other side of the Pacific.
Picture the boardwalk version of supply-chain compliance. It’s August. Fingers are that odd combination of french fry-greasy and ice cream-sticky The arcade is humming. Someone hands you the mallet. The first mole pops up with a familiar name: Huawei. Easy. Then SMIC. Fine. Then a listed Chinese military company. Also easy. You swing, you hit the obvious targets, and for a moment the game looks like it’s under control.
Then the real game starts.
Continue Reading China Supply Chain Compliance Is Becoming Whack-a-Mole
What Federal Contractors Should Be Watching This Summer
Summer 2026 has arrived with a new wave of artificial intelligence (AI) policy from the White House. On June 2, 2026, President Trump signed an Executive Order titled “Promoting Advanced Artificial Intelligence Innovation and Security” (the Order). The Order directs federal agencies—on aggressive 30‑ and 60‑day timelines, with key deliverables due by July 2, 2026 and August 1, 2026—to harden federal information systems with AI‑enabled defenses, establish a voluntary framework for pre‑release federal access to so‑called “covered frontier models,” and prioritize criminal enforcement against malicious AI‑enabled cyber activity. Although the Order is framed as innovation‑and‑security policy and expressly disclaims any “mandatory governmental licensing, preclearance, or permitting requirement” for new AI models, it will have immediate operational consequences for federal information‑technology and cyber contractors, AI developers, critical‑infrastructure operators, and their service providers.
Continue Reading AI Heats Up: New Executive Order on Promoting Advanced Artificial Intelligence Innovation and Security
The Department of Defense’s proposed rule implementing Section 847 of the FY 2020 NDAA could fundamentally reshape how foreign ownership, control, or influence (FOCI) is monitored across the defense industrial base. Through proposed DFARS Part 240, the rule would extend recurring FOCI disclosure, National Industrial Security System (NISS) reporting, and Defense Counterintelligence and Security Agency (DCSA) oversight far beyond the traditional facility-clearance context and into ordinary government contracting. For foreign-owned contractors, allied-country suppliers, private equity sponsors, and federal subcontractors, the proposal signals the emergence of a permanent compliance regime built around continuous visibility rather than one-time vetting.
Friends, Romans, contractors, lend me your ears;
I come to disclose your owners, not to debar them.
The FOCI that contractors do is oft assessed;
The clearances are oft interred with their bones.
So let it be with allies. The honorable rule
Hath told you that we treat all foreigners alike;
If it be so, it is a grievous form,
And grievously hath the SF-328 answered it.
The speech may be a little ridiculous, but in its way, it’s also a little accurate. The proposed DFARS rule implementing Section 847 of the FY 2020 NDAA is not unkind to allies. It is, as was Mark Antony, scrupulously polite to them, right up to the moment it asks them to register as suspects.
Continue Reading Section 847 and the New Era of DOD Continuous FOCI Monitoring
Given recent world events and their attendant economic shocks, 2026 looks to be another year of supply chain gyration. Government contractors, besides having to cope with such shocks, must add semiconductors to the list of supply chain concerns. Semiconductors, as the U.S. Government states in a new proposed rule (2026-03065 (91 FR 7223)), are the “tiny electronic devices” essential to “consumer electronics, automobiles, data centers, critical infrastructure, and virtually all military systems.” Indeed, semiconductors “power tools as simple as a power adapter and as complex as a fighter jet or a smartphone. They are also essential building blocks of the technologies that will shape our future, including artificial intelligence, biotechnology, and clean energy.”
Continue Reading Semiconductors: Another Link to Ever-Extending Curation of the Federal Supply Chain
In every crisis, half the room runs in circles while the other half picks up a clipboard and starts taking stock. The Anthropic-Pentagon dispute is that crisis, and defense contractors are deciding which half they want to be in.
The short version: The government designated a FedRAMP-authorized, facility-cleared American AI company a national security supply chain threat, via social media, after the company refused to remove safety restrictions on autonomous weapons and mass surveillance. Anthropic sued days later, with the Pentagon’s own officials on the record stating the designation was “ideologically driven” with “no evidence of supply chain risk.”
Continue Reading Don’t Panic! How Federal Contractors Should Navigate the Anthropic Designation
“I felt a great disturbance in the Force, as if millions of voices suddenly cried out in terror and were suddenly silenced.”
When Obi-Wan Kenobi says this in Star Wars: Episode IV – A New Hope, he senses that something profound just changed in the galaxy. A powerful presence has vanished. The balance of power shifting in ways that will ripple far beyond the immediate moment. As Yoda later describes the Force: “Life creates it, makes it grow. Its energy surrounds us, binds us.” In this way, artificial intelligence (AI) is beginning to play a role for the US Defense Industrial Base (DIB) not unlike the Force itself—quietly enhancing the capabilities of engineers, analysts, and compliance professionals across thousands of organizations supporting national defense programs.
So what could happen if a major AI player suddenly disappears from the board?
Continue Reading Orbiting A.I.-deraan? A Disturbance in the Force for the Defense Industrial Base
Remember in Coming to America when Eddie Murphy’s Prince Akeem shows up in Queens full of charm, optimism, and big dreams and somehow it all works out? Fast-forward 38 years (yes, it’s been that long) and European companies looking to sell into the US Department of Defense (DoD) and Department of Homeland Security supply chains will need much more than charm. Instead, they’ll need real strategy, a focused structure, and readiness for regulatory scrutiny that doesn’t end with an award notification. In the current climate, with a heightened domestic preference policy, new executive directives such as the “Prioritizing the Warfighter in Defense Contracting” executive order, and renewed focus on supply chain security and performance, it is essential for foreign companies and their counsel to clearly understand the terrain before landfall.
Continue Reading Coming to America (the Government Contracting Edition): Ownership, Compliance, and Shifting Policy
The BIOSECURE Act in the FY 2026 NDAA is a quiet, sweeping shift in federal supply-chain enforcement that reaches beyond “biotech” and into the tools most companies barely think about like software, AI, data platforms, and third-party services used behind the scenes. As Alex Major and Franklin Turner write in The Government Contractor, BIOSECURE Act
The FY2026 National Defense Authorization Act (NDAA) became law on December 18, 2025, enacting a tidal wave of the Trump administration’s priorities with respect to Department of Defense (DoD) procurement. One key priority reflected in the NDAA is reducing compliance burdens so that (i) established DoD contractors are incentivized to pursue awards and (ii) more companies opt in to being a DoD contractor to grow the industrial base. Importantly, Section 1804 and Section 1806 of the NDAA take action on this priority by raising the dollar thresholds for complex domains of government contracting: the Cost Accounting Standards (CAS) and submission of certified cost or pricing data. While these changes are welcome developments, companies should be cognizant that a steady stream of compliance requirements remains even with these increased thresholds.
Continue Reading Swept Away: FY2026 NDAA Updates to CAS and Certified Cost or Pricing Data Thresholds