New government contracts and grants rules limit universities' ability to use certain Chinese telecommunications equipment

Hogan Lovells

Federal contractors, including universities, will soon need to certify that they do not "use" telecommunications equipment or services produced or provided by certain Chinese companies (including ZTE, Hikvision, and Huawei) under a Federal Acquisition Regulation (FAR) Interim Rule published on 14 July 2020. The interim rule, which implements Section 889(a)(1)(B) (Part B) of the Fiscal Year 2019 National Defense Authorization Act (FY19 NDAA), Prohibition on Certain Telecommunications and Video Surveillance Services or Equipment, will be effective 13 August 2020 (the statutory deadline mandated in the FY19 NDAA). However, the public can still submit comments until 14 September 2020 for consideration in the formation of a final rule. In addition to the government contracts rule, a related change to the Office of Management and Budget's (OMB's) Uniform Guidance (2 CFR Part 200), will also become effective 13 August 2020, prohibiting the use of grant funds to enter into contracts (or extend or renew contracts) with entities that use the covered telecommunications equipment or services.

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