On October 5, 2023, the Federal Acquisition Regulatory (FAR) Council moved toward stricter supply chain security with an announced Interim Rule on “Implementation of Federal Acquisition Supply Chain Security Act (FASCSA) Orders.” The Interim Rule, effective from December, implements key requirements from Section 202 of the FASCSA of 2018.
As detailed by Sheppard Mullin Richter & Hampton LLP this legislation will require contractors to rigorously vet and ultimately remove certain products and services from the U.S. Government supply chain. The decision on which items are to be excluded will be taken up by the Federal Acquisition Security Council (FASC).
The reasoning behind this strategy is to protect national security and to maintain the integrity of federal acquisitions. However, it will likely present new challenges for contractors tasked with complying with the requirements.
The introduction of this rule marks an important development in the evolving landscape of federal acquisition regulations, driving a shift toward heightened emphasis on supply chain security.
Contracting parties currently working or planning to work with the U.S. Government should anticipate this change and begin a proactive review of their supply chain management strategies. Understanding the specific requirements of this law will be critical to achieving compliance and avoiding potential penalties.
While it’s understood that implementing the necessary changes may present temporary obstacles for some entities, ultimately, the enhanced security of the U.S. Government’s supply chain makes this a necessary evolution in policy, likely setting a precedent for other jurisdictions to follow suit.