Overview of the Defense Production Act and Implications for Government Contractors

By Executive Order dated March 18, 2020, the President invoked wartime powers authority provided in the Defense Production Act (‘DPA’) to direct private industry in the interests of the national defense.  The President’s authority includes the ability to prioritize government contracts over competing customers for goods and services and allocate or control materials, services, and facilities necessary to promote the national defense. Although the Executive Order was initially limited to medical items, we are already seeing expansions to other sectors of the economy outside of the medical field.

Companies who have products and facilities that fall within the scope of the emergency response should prepare to receive rated orders or alternatively, proactively contact agency officials to make them aware of your capabilities to assist in this time of national emergency.  Our firm will continue to monitor developments about this important Executive Order and related agency guidance and are available to assess legal compliance with any such orders.