Regulatory News - U.S. Department of Defence - Stricter procurement rules - Foreign-owned companies

🚨The U.S. Departement of Defense (DoD) plans to drastically tighten its procurement rules for foreign-owned companies based in the U.S. !🚨

DefenseWise would like to draw your attention to a major development that could reshape your access to the U.S. market through your local subsidiaries 👉 the new proposed amendment to the DFARS (Case 2021-D011) targeting risks related to foreign ownership, control, or influence (FOCI) over U.S. subsidiaries.

💵If your U.S. subsidiaries (or yourself) participate in U.S. government contracts exceeding $5 million (as well as smaller contracts where applicable), this initiative marks a very significant security shift that must be immediately anticipated.

👇  Here are 3 major impacts for international companies:

• 🔒 Scope Extension : “Unclassified controlled information” and Commercial Contracts will now be subject to this transparency requirement. Worse still, it may affect commercial off-the-shelf (COTS) products whenever the DoD believes there is a risk to national security (cybersecurity, intellectual property, etc.).
• 🔎 Total Transparency : Via the SF 328 certification form, you will now be required to disclose your entire corporate structure. This includes reporting any foreign ownership (direct or indirect) of 5% or more of your shares, the presence of foreign nationals on the board of directors of your U.S. subsidiary, or if more than 5% of your revenue comes from a single foreign interest.
• ⏱️ Risk Mitigation Plans : Contractors determined to be under FOCI must agree to risk mitigation strategies and implement them within 90 calendar days of a contract award/modification.

💡 The DoD estimates that more than 37,000 entities (bidders and subcontractors) will be impacted by these new reporting and structural requirements if the reform is adopted. Officially designed to prevent U.S. foreign adversaries from gaining unauthorized access to critical technologies and intellectual property, this measure will significantly increase acquisition and compliance costs for U.S. subsidiaries of foreign groups.

📆 Anticipation is key. Don’t let these new constraints disrupt your operations or those of your supply chain. You must act before July 6, 2026, through the appropriate channels to counter or prepare for this trend (deadline to submit public comments).

📩 Contact DefenseWise SRL to assess your exposure to this new proposal from the U.S. Executive Branch and understand the next steps at your disposal.