Insights

On March 6, 2026, the General Services Administration (GSA) issued a significant proposed contract clause, GSAR 552.239-7001, Basic Safeguarding of Artificial Intelligence Systems (“Clause”), for inclusion in GSA Schedule solicitations and contracts for AI capabilities.  The proposed clause would impose substantial new requirements related to AI sources, intellectual property rights, data use, change management, and performance standards.  The Clause would also take precedence over any other contract terms (including commercial licensing terms) related to AI, including a Seller’s terms of sale and service to which the Government had previously agreed.  GSA requests comments by March 20, 2026.

On February 17, 2026, the Federal Acquisition Regulatory Council (FAR Council) released a Proposed Rule (Proposed Rule) to implement Section 5949(a) of the James M. Inhofe National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2023 (Section 5949), following the FAR Council’s May 3, 2024 Advanced Notice of Proposed Rulemaking (ANPR).  Comments on the proposed rule are due by April 20, 2026.

Congress has not passed funding bills to keep key parts of the government funded for the remainder of Fiscal Year 2026—including the Departments of Defense, State, Treasury, Labor, Health and Human Services, Transportation, Housing and Urban Development, and Homeland Security, as well as independent agencies, the judiciary, and national security and foreign operations functions. As Congress continues to negotiate a deal in advance of the expiration of funds on January 30, parts of the government may still face a short shutdown, given the time needed for both the Senate and the House to consider and approve legislation. In anticipation of that possibility, agencies whose funding is uncertain are preparing for a shutdown; contractors, grant recipients, and companies that work with those agencies should do the same. Our team is ready and available to advise through the shutdown process.

On December 18, 2025, the Fiscal Year 2026 National Defense Authorization Act (FY 2026 NDAA) (P.L. 119-60) was signed into law. The Act makes significant changes to defense acquisition, sourcing restrictions, and interactions between the Defense Industrial Base (DIB) and the Department of Defense (DOD). 

On November 7, 2025, Secretary of War Pete Hegseth announced the Department of War’s (“DoW”) Acquisition Transformation Strategy (the “Strategy”) during a speech to military leaders and industry at the National War College on Fort McNair.  The Strategy sets out five pillars for acquisition reform, each containing near-and long-term actions to “ensure delivery of capabilities to the American warfighter” at a more rapid pace.  

Yesterday, the Department of Energy (“DOE”) announced its termination of 321 grants and other awards supporting 223 energy projects.  The terminated awards were issued by the Office of Clean Energy Demonstrations, Office of Energy Efficiency and Renewable Energy, Office of Fossil Energy, the Grid Deployment Office, the Office of Manufacturing and Energy Supply Chains, and the Advanced Research Projects Agency-Energy.

Congress has not passed crucial funding bills for the start of Fiscal Year 2026.  If Congress fails to act by September 30, the government may be forced to shut down for lack of funding.  In anticipation of that possibility, agencies government-wide are preparing for a shutdown, and contractors and companies that work with the government should do so as well.  Our team is ready and available to help advise companies through the shutdown process.

On September 18, 2025, the Director of National Intelligence (DNI) issued the first order under the authority conferred by the Federal Acquisition Supply Chain Security Act (FASCSA), requiring exclusion and removal of products and services by an identified source.[1]

On August 25, 2025, the Department of Defense (DoD) issued the Final Rule implementing Section 812 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2024 (P.L. 118-31).  The Final Rule will take effect on October 24, 2025 via a new solicitation provision, DFARS 252.209-7012 (Prohibition Relating to Conflicts of Interest in Consulting Services – Certification).

On August 7, 2025, President Trump issued an Executive Order (EO) titled, “Improving Oversight of Federal Grantmaking,” setting out the framework for sweeping changes to the grantmaking process.  The order purports to address the Administration’s concerns about federal grants supporting controversial or ineffective programs and incurring excessive administrative costs.  The EO implements three key changes to federal grant requirements. 

On May 15, 2025, U.S. Department of Energy (“DOE” or the “Agency”) issued a memorandum outlining the Agency’s new policy for evaluating financial assistance awards (e.g., grants, cooperative agreements, and technology investment agreements) to identify waste, fraud, and abuse. Businesses, universities, non-profit organizations, and other entities that have received DOE financial assistance awards now face increased risk of investigation and potential award termination, withholding of funding, and project modification.

On March 20, 2025, the White House issued Executive Order (“EO”), “Eliminating Waste and Saving Taxpayer Dollars by Consolidating Procurement,” to consolidate domestic civilian contracting for “common goods and services” within one agency—the General Services Administration (“GSA”). The EO defines “common goods and services” as those described in the Category Management system first developed as part of a previous effort, dating back to 2014, to coordinate spending across the government.

On February 24, 2025, the Small Business Administration (SBA) issued a “Day One” memo outlining SBA Administrator Kelly Loeffler’s priorities. 

On February 13, 2025, Judge Amir Ali of the U.S. District Court for the District of Columbia issued a temporary restraining order in two combined cases—one filed by U.S. Agency for International Development (USAID) contractors, a second by USAID grant recipients—challenging Executive Order 14169, “Reevaluating and Realigning United States Foreign Aid,” which paused almost all foreign assistance funding. 

On January 15, 2025, the Federal Acquisition Regulatory Council issued a Proposed Rule that would implement changes to the Federal Acquisition Regulation (FAR) Organizational Conflict of Interest (OCI) rules as required by the 2022 Preventing Organizational Conflicts of Interest in Federal Acquisition Act (P.L. 117-324).  Comments on the Proposed Rule are due on March 17, 2025.  (Note that pursuant to President Trump’s January 20, 2025 “Regulatory Freeze Pending Review” Executive Order, the Proposed Rule is subject to further review, which may result in revisions and an extension of the 60-day comment period.)

On January 2, 2025, the U.S. Department of Defense (DoD) updated the 1260H List of entities identified as “Chinese military companies” (CMC) operating in the United States, as required by section 1260H of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2021 (Section 1260H), adding new entities and removing others.  The updated 1260H List now includes 76 entities. 

On December 23, 2024, the Servicemember Quality of Life Improvement and National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2025 (FY 2025 NDAA) (P.L. 118-159) was signed into law.  The final FY 2025 NDAA takes a narrower approach to acquisition policy and supply chain changes than watchers expected, but it still makes some consequential changes for contractors.  Read on as Crowell & Moring’s Government Contracts group discusses the FY 2025 NDAA’s new supply chain restrictions and requirements, changes to bid protest jurisdiction, cybersecurity requirements, and more.

On November 15, 2024, the Department of Defense (DoD) issued a Proposed Rule implementing Section 1655 of the John S. McCain National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2019 (P.L. 115-232), over six years after Congress enacted the requirement. 

Recently, there has been a significant increase in scams targeting users of the System for Award Management (SAM.gov).  Active SAM registrations are required for federal government contractors, including to receive contracts and payments.  The non-public portions of these registrations include bank account information, tax information, and other sensitive information about a company.  Recent phishing scams and efforts to gain access to registrations indicate sophisticated actors are attempting to manipulate SAM registrations, possibly for access to payments from the government, among other reasons.  Company SAM registration Administrators should protect the company’s SAM registration from unauthorized access to the greatest extent possible.

On July 9, 2024, the CHIPS Research and Development Office released a Notice of Intent (NOI) to announce a third CHIPS Act Notice of Funding Opportunity (NOFO), which will be the first focused on the CHIPS National Advanced Packaging Manufacturing Program.  The NOFO will provide up to $1.6 billion for research and development activities in five areas of semiconductor advanced packaging, including (1) equipment, tools, processes and process integration; (2) power delivery and thermal management; (3) connector technology like photonics and radio frequency; (4) the chiplets ecosystem; and (5) co-design/electronic design automation.  The NOFO is expected to include prototype development opportunities in exemplar applications including high-performance computing and low-power systems needed for artificial intelligence.  The NOI also provides information about eligibility expectations and other anticipated requirements for applications.