DOD releases interim rule to ban contractors using Huawei, ZTE services from federal contracts

The Defense Department has issued an interim rule to ban contractors who use equipment and services from Chinese companies Huawei and ZTE from obtaining government contracts.

A "prepublication version" of the rule from DOD, in conjunction with the General Services Administration and NASA, was published on Friday. Public comments will be accepted on the rule for 60 days after it is published in the Federal Register.

"DOD, GSA, and NASA are issuing an interim rule amending the Federal Acquisition Regulation (FAR) to implement section 889(a)(1)(B) of the John S. McCain National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2019 (Pub. L. 115-232)," the agencies say in a notice.

They write, "Section 889(a)(1)(B) prohibits executive agencies from entering into, or extending or renewing, a contract with an entity that uses any equipment, system, or service that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system, on or after August 13, 2020, unless an exception applies or a waiver is granted."

The new rule makes changes including:

* It amends the FAR to include the 889(a)(1)(A) prohibition, which prohibits agencies from procuring or obtaining equipment or services that use covered telecommunications equipment or services as a substantial or essential component or critical technology. (FAR 52.204-25)

* It requires every offeror to represent prior to award whether or not it will provide covered telecommunications equipment or services and, if so, to furnish additional information about the covered telecommunications equipment or services. (FAR 52.204-24)

* It mandates that contractors report (within one business day) any covered telecommunications equipment or services discovered during the course of contract performance. (FAR 52.204-25)

At a public meeting in March, industry representatives urged DOD to issue a proposed rulemaking to allow time for comment and revisions before the requirement goes into effect on Aug. 13.