Pentagon limits IT purchases to manufacturers and their approved dealers
H.R. 2765 — SAFE Supply Chains Act · Filed by Pat Fallon (R-TX) · 1 cosponsor · Introduced Apr 9, 2025 · Referred to committee
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What it does
This bill prohibits the Department of Defense from buying or using information technology hardware and components unless they come directly from the original manufacturer or an authorized reseller with a direct contractual relationship to that manufacturer. The bill aims to prevent counterfeit, compromised, or gray-market IT equipment from entering military supply chains, though it includes narrow waivers for research and mission-critical situations approved by the Secretary of Defense with notice to Congress.
Why we flagged it
The bill's core mechanism is a procurement restriction limiting DoD to OEM and authorized-reseller channels for IT hardware. While framed as supply-chain security, it functions as a market-access barrier that may benefit established manufacturers and their authorized networks at the expense of secondary-market resellers and smaller vendors.
What the text implies
- The restriction to OEM and authorized-reseller channels may increase DoD IT procurement costs by eliminating competitive secondary-market and gray-market sourcing, a cost ultimately borne by taxpayers.
- The bill does not define 'authorized reseller' in a way that prevents OEMs from restricting authorization to preferred partners, potentially creating monopolistic pricing leverage.
The full analysis lists 5 implications of this text.
Who stands to gain
Original equipment manufacturers (OEMs) of IT hardware; Authorized resellers with direct OEM contractual relationships; Established IT vendors with existing DoD relationships