Sec. 142. Requirement to buy certain articles from United States and friendly nation sources
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In this section: The terms beneficial owner and beneficial ownership shall be determined in a manner that is not less stringent than the manner set forth in section 240.13d–3 of title 17, Code of Federal Regulations (as in effect on the date of the enactment of this Act). The term company means any corporation, company, limited liability company, limited partnership, business trust, business association, or other similar entity. The term covered contractor means— a company that is not incorporated or formed in the United States; a company whose management are not United States citizens; a company whose principal place of business is not in the United States; any foreign incorporated company that is an inverted domestic corporation or any subsidiary of such company; or any joint venture if more than 10 percent of the joint venture (by vote or value) is held by a foreign incorporated company that is an inverted domestic corporation or any subsidiary of such company.
The terms foreign ownership, control, or influence and FOCI have the meanings given those terms in the National Industrial Security Program Operating Manual (DOD 5220.22–M), or a successor document. The term national technology and industrial base has the meaning given the term in section 2500 of title 10, United States Code. The Secretary of Defense shall establish procurement policies to ensure that, except as provided under subsections
(c)through (f), or as otherwise provided under law, funds appropriated or otherwise available to the Department of Defense may not be used for the procurement of any product, good, or service from a covered contractor, including contracts, subcontracts, and other transactions for the procurement of commercial products, notwithstanding section 1906 of title 41, United States Code. The Secretary of Defense shall establish a waiver process to ensure that products, goods, or services that cannot be procured under the requirements of subsection
(b)in satisfactory quality and sufficient quantity as and when needed at United States fair market prices, may be procured as needed for the specific procurement from companies— that are not under foreign ownership, control, or influence
(FOCI)of a malign foreign actor; whose beneficial owners are known to the Secretary; and that are in the national technology and industrial base. The Secretary of Defense shall establish a waiver process to ensure that products, goods, or services that cannot be procured under the requirements of subsection
(b)or subsection
(c)in satisfactory quality and sufficient quantity as and when needed at United States fair market prices, may be procured from companies in other allied or friendly nations, as designated for the specific procurement, so long as the Secretary ensures that such company is not under FOCI of a malign foreign actor or such company is not beneficially owned by a malign foreign actor. The Secretary of Defense shall establish a waiver process to ensure that products, goods, or services that cannot be procured under the requirements of subsection (b), (c), or
(d)in satisfactory quality and sufficient quantity as and when needed at United States fair market prices, may be procured from a company, as designated for the specific procurement. The requirement under subsection
(b)does not apply to procurements— outside the United States in support of combat operations; of any item in support of contingency operations or other emergencies; for which the use of procedures other than competitive procedures has been approved on the basis of section 2304(c)(2) of title 10, United States Code, relating to unusual and compelling urgency of need; for amounts not greater than the simplified acquisition threshold referred to in section 2304(g) of such title; or whose sourcing is limited by other provisions of law, international agreement, or treaty obligations. If the Secretary of Defense issues a waiver under subsections (c), (d), or (e), the Secretary shall, not later than 90 days after issuing the waiver, provide a notification to the congressional defense committees of such waiver, along with a justification for the use of the waiver and a plan to establish domestic sources for the specific product, good, or service that was the subject of the waiver, if determined appropriate. The Secretary of Defense shall report to Congress and post on a public website each fiscal quarter usage of the waivers authorized under subsections (c), (d), and (e).