Contracting America First Act
- Bill Number
- H.R. 7604
- Origin Chamber
- House
- Congress
- 119th Congress, Session 2
- Policy Area
- Government Operations and Politics
- Status
- Introduced
- Latest Action
- 2026-02-20: Referred to the House Committee on Oversight and Government Reform.
- Last Updated
- 2026-02-27T20:06:52Z
AI-Generated Summary
Purpose
The "Contracting America First Act" (H.R. 7604) aims to protect sensitive personal information of federal employees by prohibiting federal agencies from contracting with software companies that are majority-owned by non-U.S. citizens. It prioritizes U.S.-owned companies for software systems handling such data to reduce national security risks.
Key Provisions
- Prohibition on Contracts: Federal agencies cannot enter into, renew, or extend contracts for "covered software systems" with "internationally owned software companies."
- Certification Requirement: Bidders on relevant contracts must certify under penalty of perjury that they are not internationally owned.
- Waiver Option: Agencies can waive the rules on a case-by-case basis if it's deemed necessary for national security, but they must provide a written justification to congressional committees within 30 days.
- Enforcement and Penalties: If a contractor violates the prohibition or provides a false certification, the agency can terminate the contract (for default or convenience) and pursue other remedies, such as barring the company from future federal contracts (debarment or suspension).
- Implementation: The Federal Acquisition Regulation (FAR), which governs federal procurement, must be updated within 180 days of enactment to enforce these rules.
- Definitions:
- Agency: Refers to executive branch agencies (as defined in U.S. law).
- Covered Software System: Software that stores, processes, or transmits sensitive personal information for 500 or more federal employees or officers.
- Internationally Owned Software Company: A company (or its subsidiary) where more than 50% of ownership is held by non-U.S. citizens.
- Sensitive Personal Information: Includes Social Security numbers, medical or health records, personally identifiable information (PII, such as names combined with addresses or financial details), or any data that could lead to identity theft, personal harm, or national security threats if compromised.
Significant Changes to Existing Law
This bill introduces a new layer of restrictions on federal contracting not previously specified in the FAR or related laws. It adds mandatory certifications, waiver processes, and termination remedies specifically for software handling federal employee data, shifting from general procurement rules to targeted protections against foreign ownership. It does not amend existing data privacy laws (like those under the Privacy Act) but builds on them by limiting vendor eligibility.
Potential Impacts
- On Government Agencies: Agencies will face stricter vendor vetting for software contracts involving sensitive data, potentially increasing administrative costs for certifications and waivers but enhancing data security. Procurement processes may slow down initially due to FAR updates.
- On Citizens: Federal employees benefit from reduced risk of data breaches or foreign access to their personal information, indirectly protecting taxpayers from related security incidents. However, it could limit access to innovative software if U.S.-owned alternatives are scarce.
- On International Relations: The law may strain ties with countries whose citizens or entities own software firms, as it effectively discriminates against foreign-owned companies. It could prompt retaliatory measures in international trade or tech sectors, signaling a "buy American" approach in government tech.
Main Stakeholders Affected
- Federal Agencies: Directly responsible for compliance, including heads of agencies who must enforce prohibitions and handle waivers.
- Software Companies: U.S.-owned firms gain a competitive edge in federal contracts; internationally owned ones (e.g., those with majority foreign investment) may lose opportunities and face certification burdens.
- Federal Employees and Officers: Their sensitive data is protected, affecting over 500 individuals per system.
- Congressional Committees: Gain oversight through waiver notifications, particularly those on oversight, government reform, and national security.
- Taxpayers: Indirectly impacted via more secure but potentially costlier federal IT systems.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens federal procurement laws by integrating national security into contracting decisions, with perjury penalties for false certifications adding enforceability. Remedies like debarment align with existing Federal Acquisition Regulation tools but apply them more specifically.
- Constitutional: Likely upheld under Congress's authority to regulate commerce and government spending (Commerce Clause and Appropriations Clause), as it targets federal contracts without broadly restricting private commerce. No direct free speech or due process issues, though challenges could arise if waivers are seen as arbitrary.
- Political: Promotes a protectionist "America First" policy in tech procurement, potentially fueling debates on economic nationalism versus global innovation. It could influence broader U.S. tech policy amid concerns over foreign espionage, but risks accusations of trade barriers under international agreements like WTO rules.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Recent Actions
- 2026-02-20: Referred to the House Committee on Oversight and Government Reform.
- 2026-02-20: Introduced in House
- 2026-02-20: Introduced in House
Bill Versions
- Contracting America First Act — issued 2026-02-20 — PDF (3 pages)