Two cornerstone authorities for federal contracting quietly expired on September 30, 2025, creating ripple effects that contractors—small and large—cannot afford to overlook. The Small Business Innovation Research/Small Business Technology Transfer (“SBIR/STTR”) programs, commonly known as “America’s Seed Fund” for their role in fueling early-stage innovation, and the Defense Production Act (“DPA”), the backbone of the government’s ability to prioritize contracts and strengthen the industrial base, both lapsed at the close of the fiscal year. Although lawmakers have floated temporary or long-term fixes in pending legislation, nothing has yet been enacted. The simultaneous government shutdown further complicates the picture, making new awards unlikely in the near term and magnifying uncertainty for contractors who rely on these authorities.Continue Reading Expired: SBIR/STTR and DPA Authorities in Limbo
To Efficiency and Beyond?: President Trump Issues Executive Order to Enable a Competitive Space Launch Market
On August 13, 2025, the White House issued Executive Order 14335, “Enabling Competition in the Commercial Space Industry” (“EO 14335” or the “EO”). Framed as a push to “enhance American greatness by enabling a competitive launch marketplace and substantially increasing commercial space launch cadence and novel space activities by 2030,” EO 14335 directs federal agencies to reform regulatory barriers in four key areas: (1) commercial launch and reentry, (2) spaceport infrastructure, (3) novel space activity authorization, and (4) leadership and accountability. Sec. 2. Each of these initiatives aims to streamline bureaucracy, reduce delays, and accelerate U.S. commercial space growth. Below, we break down the EO’s provisions in each area and examine their significance for industry stakeholders.Continue Reading To Efficiency and Beyond?: President Trump Issues Executive Order to Enable a Competitive Space Launch Market
FAR Overhaul: OMB Sends 16 Legislative Proposals to Congress, Pushing Sweeping Acquisition Reform
The Office of Management and Budget (OMB) has taken the next major step toward implementing the General Services Administration’s (“GSA”) Revolutionary FAR Overhaul (RFO), submitting to Congress 16 legislative proposals aimed at modernizing federal acquisition law and easing statutory burdens on both agencies and contractors on July 16, 2025. The proposals, published here, underscore GSA’s commitment to aligning statutory authorities with the RFO’s ambitious deregulatory vision.
As detailed in our prior blog posts, the FAR modernization process is already well underway, with class deviations issued by FAR part and proposed rules expected in the fall. GSA has emphasized that the RFO is not limited to rewriting the FAR, however — GSA will also actively engage with Congress and the White House to remove unnecessary burdens imposed by statute or Executive Order. This legislative package shows that that effort has begun in earnest.
Below are a few highlights from the proposals.Continue Reading FAR Overhaul: OMB Sends 16 Legislative Proposals to Congress, Pushing Sweeping Acquisition Reform
One Big Beautiful Bill Act makes $150B investment in Defense
Launching 150 billion euro for defense and technology
On May 29, 2025, the European Union established its new €150 billion defense fund through the Security Action for Europe (SAFE) regulation. The European Commission will soon launch a call for interest for SAFE loans and EU Member States will have up to two months to submit their
Continue Reading Launching 150 billion euro for defense and technologyRearming Europe with Trusted Partners
In March 2025, the European Union published a white paper for European Defense Readiness 2030, which identifies defense needs and envisions a massive €800 billion four-year “ReArm Europe” investment plan. This initiative is a significant step change from the EU’s prior defense industrial strategy and earlier funding programs.
Rearming Europe would be financed by €150 billion in EU common debt made available as loans to Member States and €650 billion in national spending that EU fiscal rules would not constrain. This new package is intended to support EU Member State efforts to ramp-up defense capabilities and, if implemented, it would effectively double the overall amount of defense spending in Europe. Covington is working with clients in defense industry sectors across the wider West to maximize business opportunities created by this new funding.
Unleashing Europe’s Defense Potential
Given the “rapid deterioration of the geopolitical context and rising tensions,” the white paper pledges to unleash the EU’s resources and latent industrial and technological power on defense. It aims to swiftly increase support for Ukraine and deter Russia’s further aggression, while reducing dependency on U.S. military support. Further, it paves the way to tackle long-term security threats such as the “systemic” challenge posed by China and growing hybrid threats.
The EU seeks to support collaborative capability development among Member States, to enhance coordination and generate economies of scale. Here, joint procurements will be a privileged tool, notably by setting up a European Military Sales Mechanism. This mechanism will support manufacturing capabilities and deliver more complex projects through aggregated demand and increasing predictability for the sector. To do so, it will incentivise long-term common procurements, as envisioned also by the European defense common procurement act.
In the near-term, investments and procurements on defense industrial capabilities will focus on rebuilding Europe’s depleted stocks of military hardware and equipment. Key capability domains include air and missile defense, artillery systems, ammunition and missiles, drones and counter-drone systems, military mobility, artificial intelligence, quantum, cyber & electronic warfare, strategic enablers and critical infrastructure protection.
To quickly expand its defense capabilities, Europe is also exploring strengthening its defense industrial collaboration with trusted partners such as the Republic of Korea, Norway, and Japan (with which the EU signed Security and Defence Partnerships last year), as well as its traditional allies and partners, such as the United Kingdom and the United States.Continue Reading Rearming Europe with Trusted Partners
Trump Administration Issues Executive Order Aimed At Modernizing Defense Acquisitions And Spurring Innovation
On April 9, 2025, President Trump issued an Executive Order (“EO”), “Modernizing Defense Acquisitions and Spurring Innovation In the Defense Industrial Base,” that may have significant implications for federal government contractors doing business with the Department of Defense (“DoD”), and particularly those with touchpoints to Major Defense Acquisition Programs (“MDAPs”).
The EO requires DoD to take a number of actions, including:
- Within 60 days (i.e., June 8th), the Secretary of Defense must submit to the President a plan to reform the DoD acquisition process to eliminate inefficiencies. The plan must prioritize commercial solutions and the use of Other Transactions Authority (“OTA”) agreements and Rapid Capabilities Office mechanisms. The plan must also eliminate redundant tasks and approvals, centralize decision-making, and incorporate effective risk management for all acquisition programs through a governance structure referred to as a Configuration Steering Board.
- Under no specified timeline, DoD is generally directed to revise internal regulations and implementation guidance — including the DoD Financial Management Regulation and the Defense Federal Acquisition Regulation Supplement — utilizing the principle from the “Unleashing Prosperity Through Deregulation” EO (Jan. 31, 2025) that for every new regulation proposed, ten existing regulations should be repealed.
- Within 90 days (i.e., July 8th), the Secretary of Defense must review all MDAPs and consider for “potential cancellation” programs that are: (1) more than 15% behind schedule; (2) more than 15% above cost; (3) “unable to meet key performance parameters”; or (4) otherwise not aligned with DoD mission priorities. Following this review of MDAPs, the Secretary of Defense will conduct a similar review for all remaining major systems.
- Within 120 days (i.e. August 7th), the Secretary of Defense, in collaboration with the Military Departments, must propose a plan to overhaul the defense acquisition workforce by restructuring performance metrics, assessing workforce sizing requirements, and deploying expert-led field training teams to enhance familiarity with innovative acquisition authorities. These reforms are intended to incentivize prudent risk-taking and expand the workforce’s fluency in commercial solutions and adaptive acquisition strategies.
- Within 180 days (i.e., October 6th), the Secretary of Defense, acting through the Deputy Secretary of Defense, the Secretaries of the Military Departments and the Joint Chiefs of Staff, must complete a comprehensive review of the Joint Capabilities Integration and Development System (“JCIDS”), with the aim of streamlining and accelerating acquisition.[1]
We address the EO’s directives for acquisition process reform and MDAP review in greater detail below. Continue Reading Trump Administration Issues Executive Order Aimed At Modernizing Defense Acquisitions And Spurring Innovation
New Law Appears to Restrict Defense Contractors from Retaining Consultants Who Lobby for Chinese Military Companies
Under a newly enacted law, beginning June 30, 2026, defense contractors risk losing all future contracts with the Defense Department if they engage outside consultants that lobby for certain Chinese companies. On December 23, 2024, President Biden signed the National Defense Authorization Act (“NDAA”) for Fiscal Year (“FY”) 2025
Continue Reading New Law Appears to Restrict Defense Contractors from Retaining Consultants Who Lobby for Chinese Military CompaniesPresident Biden signs the National Defense Authorization Act for Fiscal Year 2025
This is the first blog in a series covering the Fiscal Year 2025 National Defense Authorization Act (“FY 2025 NDAA”). This first blog will cover: (1) NDAA sections affecting acquisition policy and contract administration that may be of greatest interest to government contractors; (2) initiatives that underscore Congress’s commitment to strengthening cybersecurity, both domestically and internationally; and (3) NDAA provisions that aim to accelerate the Department of Defense’s adoption of AI and Autonomous Systems and counter efforts by U.S. adversaries to subvert them.
Future posts in this series will address NDAA provisions targeting China, supply chain and stockpile security, the revitalized Administrative False Claims Act, and Congress’s effort to mature the Office of Strategic Capital and leverage private investment to accelerate the development of critical technologies and strengthen the defense industrial base. Subscribe to our blog here so that you do not miss these updates.
FY 2025 NDAA Overview
On December 23, 2025, President Biden signed the FY 2025 NDAA into law. The FY 2025 NDAA authorizes $895.2 billion in funding for the Department of Defense (“DoD”) and Department of Energy national security programs—a $9 billion or 1 percent increase over 2024. NDAA authorizations have traditionally served as a reliable indicator of congressional sentiment on final defense appropriations.
FY 2025 marks the 64th consecutive year in which an NDAA has been enacted, reflecting its status as “must-pass” legislation. As in prior years, the NDAA has been used as a legislative vehicle to incorporate other measures, including the FY 2025 Department of State and Intelligence Authorization Acts, as well as provisions related to the Departments of Justice, Homeland Security, and Veterans Affairs, among others.
Below are select provisions of interest to companies across industries that engage in U.S. Government contracting, including defense contractors, technology providers, life sciences firms, and commercial-item suppliers.Continue Reading President Biden signs the National Defense Authorization Act for Fiscal Year 2025
Mobilizing Greater Defence Capabilities in Europe: the EU’s Defence Industrial Strategy
In early March, the EU released its first-ever European Defence Industrial Strategy (EDIS), accompanied by a proposed regulation establishing the European Defence Industry Programme (EDIP). The aim is to boost defence capabilities in Europe through greater and more efficient spending. In particular, the strategy seeks to reverse recent trends, whereby 78% of defence acquisitions by EU countries since Russia’s full-scale aggression against Ukraine were made with non-EU producers, with U.S. firms accounting for 63%. It also addresses recent concerns by the defence industry over ESG constraints on obtaining private financing.
The ultimate benchmark for success, as recounted by one EU foreign minister, is whether these measures will help deter Russia and other adversaries. Nonetheless, it reflects greater operational focus of the EU on defence and security issues, and what in practice the European Commission and other EU institutions can do to bolster capabilities in a policy area that will remain the primary prerogative of EU Member States.
Plugging Defence Gaps
Since the end of the Cold War, European defence has suffered from perennial underinvestment and lack of policy support for the defence industry. Whereas Europe collectively spent on defence over half of the U.S. totals in the early 1990s, it now spends about one-third compared to the United States—arguably at a time of much greater security threats to Europe compared to America. There are simply not enough soldiers, tanks, planes, ships, missiles, guns, and ammunition in Europe, nor domestic facilities to produce the necessary weapons systems and materiel. Moreover, EU countries have procured defence products at a national level, exacerbating fragmentation within the European market. This fragmentation has led to the creation of national industrial silos and numerous defence systems that often lack interoperability.Continue Reading Mobilizing Greater Defence Capabilities in Europe: the EU’s Defence Industrial Strategy