NDAA FY19 Section 889 Part A - What It Means For You

Part I – NDAA FY19 Section 889

Prohibition on Use of and Contracting for Certain Covered Telecommunications and Video Surveillance Services or Equipment

Did you know that certain telecom is prohibited at all levels of the Federal Government supply chain, including corporate use of prohibited telecom at all levels of an organization supporting the Federal Government??This #FARFriday discusses some high-level but critical components of Part A. We will cover Part B next week.

NDAA FY19 Section 889 Overview

The John S. McCain National Defense Authorization Act for Fiscal Year 2019 (NDAA FY19) authorized FY19 appropriations and set policies on a variety of matters to include Section 889 which prohibits the procurement of certain telecommunications and video surveillance services or equipment.

NDAA FY19 Section 889: Prohibition on Certain Telecommunications and Video Surveillance Services or Equipment, contains two parts.

·??????Part A: a contractor cannot sell or provide covered telecom to federal agencies, as of the August 13, 2019 implementation date.

·??????Part B: a contractor who intends to pursue a federal contract(s) cannot use covered telecom at all, whether it relates to the performance of a federal contract or not, as of the August 13, 2020 implementation date.

NDAA FY19 Section 889 Part A

Section 889(a)(1)(A) prohibits the Government from obtaining (through a contract or other instrument) certain telecommunications equipment or services produced by the following Chinese companies or their subsidiaries and affiliates:

·??????Dahua Technology Company

·??????Hangzhou Hikvision Digital Technology Company

·??????Huawei Technologies Company

·??????Hytera Communications Corporation

·??????ZTE Corporation

Part A also defined “covered” telecom in which the term “Covered” is synonymous with the term ‘Prohibited’. It also provided direction for the Government and the contracting community regarding implementation of the policy.

Implementation & Policy Implications

This policy required careful analysis of both the supply chain contractors, as well as the corporate equipment and services used by Government contracting companies. With such a complex and far-reaching policy, DoD, GSA, and NASA had to issue multiple rules (FAC 2019-05 and FAC 2020-03) amending the FAR to implement Section 889 as it would have a significant economic impact on a substantial number of small entities.

One of the first impacts to contractors was a new solicitation provision and contract clause.?The provision at FAR 52.204-24 requires offerors to self-certify and represent via SAM whether their offer includes covered telecommunications equipment or services and if so, to identify additional details about its use. The clause at FAR 52.204-25 prohibits contractors from providing 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, unless an exception applies, or a waiver is obtained. The contractor must also report any such equipment, systems, or services discovered during contract performance; this requirement flows down to subcontractors.

This rule applies to all acquisitions, including acquisitions at or below the simplified acquisition threshold and to acquisitions of commercial items.

Stay tuned for updates on Section 889 Part B and Section 5949 of the FY23 NDAA in future #FARFridays!

FAR Subpart 4.21 Prohibition on Contracting for Certain Telecommunications and Video Surveillance Services or Equipment