DOD Considers Supply Chain Risks in Contracts for National Security Systems

February 19, 2014

DOD Considers Supply Chain Risks in Contracts for National Security Systems

On November 18, 2013, the Department of Defense (DOD) issued an interim rule implementing a new pilot program that will consider the adequacy of IT contractors’ supply chain risk-management systems and exclude those contractors with insufficient systems from contract awards. The rule implements section 806 of the National Defense Authorization Act of 2011. The rule applies to procurements for national security systems that are utilized for intelligence or cryptologic activities or the command and control of military forces, or which are part of a weapon or weapons system. “Supply chain risks” are defined as the threat of sabotage or other subversion of these national security systems. Contractors are not required under the rule to introduce specific supply chain risk protections; however, supply chain risk management will be a factor in the evaluation of IT contractors’ national security system proposals. Additionally, the government is not required to disclose any information related to the decision to exclude a contractor from award based on supply chain risks, and the decision cannot be reviewed by either the Government Accountability Office in a bid protest or by the courts. (78 Fed. Reg. 69268, 11/18/2013.)






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