President Donald Trump signed an executive order Monday aimed at tightening oversight of defense supply chains and reducing the military's reliance on materials sourced from China, Russia, Iran, and North Korea.
"The United States must secure its supply chains against physical, cyber, and economic subversion," the executive order states.
The order reaches beyond finished weapons systems to the minerals, metals, chips, and other components used to build them. Those materials often pass through multiple layers of suppliers before reaching a prime contractor, but government oversight has typically extended only to the first or second tier, leaving deeper parts of the supply chain largely unmonitored.
"Defense contractors have historically under-prioritized domestic production and resilience," the order states, despite long-standing legal restrictions on sourcing sensitive materials from adversarial nations.
Beginning Jan. 1, 2027, the war secretary will sharply limit waivers allowing contractors to use materials from covered nations, including China, Russia, Iran, and North Korea.
Contractors seeking an exception after that date must show they are working to remove the noncompliant material from their supply chains under a formal mitigation plan with a timeline for compliance.
Companies found to have committed fraud or knowingly failed to carry out an approved mitigation plan could face contract penalties or be referred to the Justice Department for possible prosecution.
The order also requires contractors, including subcontractors, to trace components back to their original raw material source to help the War Department identify supply chain vulnerabilities before they become national security problems.
Contractors also will be screened for financial instability, foreign ownership or influence, and manufacturing capacity constraints. They will be required to submit corrective action plans and track those fixes until they are resolved.
The order directs the department to accelerate testing and approval of new domestic material sources while identifying and removing regulations that have slowed the process.
It preserves an exception for the U.S. Strategic Critical Minerals Reserve, known as Project Vault, as well as materials tied to projects backed by the Export-Import Bank or other federal development finance programs.
The order builds on earlier Trump administration actions involving the defense industrial base, including a January order restricting stock buybacks by underperforming defense contractors and a February order establishing the America First Arms Transfer Strategy.