Contractors want extended deadline to rid Chinese tech from networks

Two large industry trade associations have asked Congress to extend an approaching deadline for contractors to rid their networks of Huawei, ZTE and other blacklisted Chinese technology as the government looks to clear the controversial tech from its supply chain.

Section 889 part B of the 2019 National Defense Authorization Act forbids all government agencies from entering or re-entering into contracts with companies that use the banned Chinese tech come August 2020. But so far limited guidance has been issued on how this statute will be implemented, and contractors are worried about the added cost of scrubbing their networks during the ongoing economic downturn, according to a letter from the Professional Services Council and National Defense Industrial Association.

“Securing supply chains against subtle, determined, and sophisticated adversaries remains essential for national security,” reads the letter signed by David Berteau, PSC president and CEO, and Hawk Carlisle, CEO and president of NDIA. “By granting this request for an extended timeline, the defense industrial base will be in a better position to continue delivering uncompromised support for national defense objectives, even during this unprecedented crisis.”

Berteau and Carlisle ask in the letter for the deadline to be delayed until at least February 2021.

The Defense Department, which has one of the largest supply chains in the world with more than 350,000 companies in its industrial base, has recently held public meetings to gather feedback on how to implement the broad language of the law. Those meetings showcased the tension felt on both sides during the law’s rollout. Contractors, on one hand, are reluctant to declare how much soon-to-be banned tech they operate with. And the Pentagon is split between enforcing the ban but also issuing guidance that won’t overburden contractors, Katherine Gronberg, vice president for government affairs at Forescout, told FedScoop in an interview.

“They could make this execution extremely complex for these suppliers,” Gronberg said of how the DOD could implement the law.

The General Services Administration held a similar meeting last fall to discuss compliance with the law across the federal government, including civilian agencies.

Gronberg added that small- and medium-sized companies are in a “less solid position” to undertake expensive network exams to weed out Huawei and other Chinese tech. That’s compounded by the fact that small businesses are at a higher risk of collapse during the economic upheaval caused by the coronavirus pandemic.

Large companies won’t have it easy either, as their supply chains are larger and more complex and will require deeper scrubs.

“They have massive, complex networks, in some ways it will be hard for them too,” Gronberg said.

PSC and the NDIA want to extend the deadline out of the fear that compliance with the law during the ongoing pandemic could be the last nail in the coffin for struggling defense contractors. Supply chain analysis from Govini, a big data analytics firm, shows that the DOD’s supply chain is under threat from lockdowns and economic fallout from the coronavirus.

The new letter reiterates the concerns of what further impacts to supply chain could cause. “The current crisis environment will greatly reduce the ability of companies to successfully complete such reviews by the current August 13, 2020 deadline,” the letter states.