Starting December 4th, Contractors Must Rid Supply Chains of Covered Articles and Sources Subject to FASC Orders
Effective December 4, 2023, a new interim rule will prohibit contractors from delivering or using covered articles and sources subject to exclusion or removal orders issued under the Federal Acquisition Supply Chain Security Act of 2018 (“FASCSA”). The rule is intended to eliminate certain technology from the federal supply chain that foreign adversaries might exploit to commit malicious cyber acts. The interim rule allows the executive branch through the Federal Acquisition Security Council (“FASC”) to exclude certain technologies and manufacturers from federal procurements and even to require removal of covered articles from federal or contractor information systems during performance.
The rule imposes a host of new obligations, including certification, monitoring, and reporting requirements. This post provides practical guidance on the rule and several compliance tips to help contractors prepare for the December deadline.
Background
Congress passed Section 202 of the FASCSA to protect the information and communications technology (“ICT”) supply chain against threats and vulnerabilities that may lead to data and intellectual property theft, damage to critical infrastructure, or national security harm. The Act established the FASC as an interagency council authorized to make recommendations for orders that would require the removal of covered articles from agency information systems (removal orders) or the exclusion of sources or covered articles from agency procurement actions (exclusion orders) (collectively referred to as “FASCSA orders”).
In August 2021, the FASC issued a final rule establishing procedures for recommending removal and exclusion orders. The FASC evaluates supply chain risk based on several non-exclusive factors and sends its recommendations to the Secretaries of Homeland Security and Defense and the Director of National Intelligence to consider when deciding whether to issue a FASCSA order. If a FASCSA order is issued, agencies are required to implement the exclusion or removal order.
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