President Issues Executive Order to Ban Cyber Purchases from Foreign Adversaries

On Wednesday, May 15, 2019, President Trump signed an Executive Order (EO) declaring a national emergency invoking the authorities of the International Emergency Economic Powers Act and the National Emergencies Act. This EO “prohibits any acquisition, importation, transfer, installation, dealing in, or use of hardware, software, or other product or service” of companies controlled by foreign adversaries.

The EO states that “foreign adversaries are increasingly creating and exploiting vulnerabilities in information and communications technology and services . . . in order to commit malicious cyber-enabled actions, including economic and industrial espionage against the United States and its people.”

The President found that unrestricted acquisition of information and communications technology or services controlled by “foreign adversaries” could have “catastrophic effects” and “constitutes an unusual and extraordinary threat to national security, foreign policy and economy of the United States.” Definitions of these terms can be found on page four of the Executive Order.

“Although maintaining an open investment climate in information and communications technology, and in the United States economy more generally, is important for the overall growth and prosperity of the United States, such openness must be balanced by the need to protect our country against critical national security threats. To deal with this threat, additional steps are required to protect the security, integrity, and reliability of information and communications technology and services provided and used in the United States.”

Which companies will be subject to this ban is yet to be determined, though Huawei and Kaspersky have already been banned from doing business with the government.

In the interim, this EO, and the actions taken by the Department of Defense (DoD) to date under DFARS Case 2013-D018, should prompt you to reevaluate and ensure the reliability of the products and services you use in your company when performing government contracts, as well as those you purchase through your supply chain for inclusion in the products or services you provide the government.