Navigating the 1260H List: Evolving Obligations for Government Contractors

Section 1260H of the FY2021 National Defense Authorization Act (NDAA) requires the Department of Defense (DoD) to identify and publish a list of “Chinese military companies” operating directly or indirectly in the United States. While the statutory provision itself is a reporting requirement, Congress has enacted subsequent restrictions tied to these DoD designations, including Section 805 of the FY2024 NDAA, which introduced federal procurement prohibitions.

Beginning June 30, 2026, the DoD may not enter into, renew, or extend contracts with any entity identified by the department as a Chinese military company under Section 1260H, or with any entity determined to be under their control. Recent NDAA amendments further expanded DoD’s authority to list parent companies and subsidiaries where statutory criteria are met. Beginning June 30, 2027, this restriction expands to the indirect procurement of end products or services developed by these listed entities. While these restrictions have significant implications for government contractors and supply chain risk management, they do not extend to components incorporated into a larger end item.

This webinar will cover the 1260H implementation timeline, evolving screening obligations for government contractors, and the broader implications for supply chain risk management.

We will discuss:

• Section 1260H and 805 Procurement Restrictions: an overview of the two-phased enforcement timeline (June 2026 and June 2027) and the specific ‘direct vs. indirect” prohibitions facing defense contractors.
• The Implementation Gap: a brief update on the status of the formal implementing rules (DFARS Case 2024-D012) and how to prepare for potential enforcement despite the current lack of official regulatory guidance.
• Best practices for identifying 1260H-listed entities and their affiliates within supply chains.

Questions
Please contact Emily Feldman with any questions.