Impact on Construction Unclear
A recently unclassified memorandum extends a waiver on the applicability of a new prohibition—often referred to as “Section 889 Part B”—of certain telecommunications for the Department of Defense (DOD), which can include items construction contractors install in conjunction with DOD projects. The prohibition bars federal agencies from entering into, extending, or renewing a contract with a contractor that uses any equipment, system, or service that utilizes certain Chinese companies’ telecommunications equipment or services as a component or critical technology of any system, unless an exception applies or a waiver is granted. The new memo will allow DOD to continue to contract for “low risk” products and services with entities it would otherwise be prohibited until September 30, 2022. It is unclear what exactly constitutes “low risk,” as no accompanying guidance has been made public. Contractors should check their contracts to ensure they either do or do not meet the waiver’s requirements. AGC has long called on Congress, and other agencies, to extend the date of implementation and to make key changes to the rule.
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