Changes to Supply Chain Management and Commercial Item Contracting in FY 2018 NDAA

For Department of Defense (DoD) acquisitions, the Conference Report for Fiscal Year 2018 NDAA includes provisions that simplify and others that complicate contractor responsibilities.

• Proposed supply chain diligence requirements may impose additional costly and time-consuming rules on contractors.
• Proposed change to the definition of a “subcontractor” may result in fewer vendors being subject to mandatory flow-down clauses.
• Proposed expanded definition of a commercial item and e-commerce portal likely to enhance the government’s ability to purchase from high technology companies.

On November 8, 2017, the U.S. Senate and House Armed Services Committees announced that they had reached agreement to reconcile the different versions of the National Defense and Authorization Act (NDAA) for Fiscal Year 2018 passed by the Senate and House earlier in the year. The Senate unanimously approved the compromise legislation on November 16, sending it to President Trump to sign into law. The 2018 National Defense and Authorization Act Conference Report sent to the President includes proposed changes to supply chain management, to the definition of a “subcontractor” and to commercial item contracting that may impact your business.

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