Prohibits State contracts for technology with Chinese government-owned or affiliated companies.
Impact
If enacted, S1862 will amend existing statutes governing public contracts, introducing a significant restriction against foreign-owned entities, particularly those tied to state-owned enterprises in China. By enforcing this restriction, New Jersey aims to safeguard its technological sovereignty and protect sensitive state operations from potential espionage and cybersecurity threats associated with foreign governmental entities. The bill mandates that companies applying for such contracts certify their eligibility, ensuring compliance with the newly established regulations.
Summary
Bill S1862, introduced in the New Jersey Legislature, seeks to prohibit state contracts for technology with companies that are owned or affiliated with the government of China. This legislation outlines that any company falling within the specified definition—operated by or affiliated with the Chinese government—will be deemed ineligible to bid on or submit proposals for technology goods or services contracts with any state agency. This initiative is part of a broader trend to enhance national security by scrutinizing foreign influence in public sector technology procurement.
Contention
The bill's introduction may raise concerns regarding international trade relations and the balance between national security and free market principles. Proponents argue that it is a necessary measure to mitigate risks associated with information sharing and technological dependence on Chinese firms. Conversely, critics may label the bill as overly broad, potentially hindering competition and innovation within the technology sector, as it excludes a wide range of companies that may not pose any actual risk but are tied to the Chinese government. The potential financial penalties for false certifications—either $250,000 or double the contract's value—also add a strict compliance requirement that could deter some businesses from engaging with state contracts.
Relating to a prohibition on governmental contracts with Chinese companies for certain information and communications technology; authorizing a civil penalty.
Relating to state contracts with Chinese companies and investments in Chinese companies and certain companies doing business with China; authorizing a civil penalty.
Provides for a reorganization of the office of information technology and for procurement of information technology systems and services (OR -$24,700,000 GF EX See Note)