This bill stops the Defense Department from signing, renewing, or extending contracts to get software source code from companies with certain ties to China. It targets companies that run or fund AI research facilities in China, have let China access the software or its source code in ways that could enable reverse engineering, or operate data centers in China related to that code, including through parent or affiliate companies. The Defense Department can make exceptions only if it decides doing so is in the national security interest. This applies for three years after the bill becomes law .

Key points:

• Who is affected: Defense Department contractors that provide software source code, especially those with AI R&D sites, data centers, or code access ties in China, including parents or affiliates.
• What changes: The Defense Department cannot enter into or continue these source code contracts with such companies, unless it grants a national security waiver.
• When: The restriction applies to contracts entered into, renewed, or extended within three years after enactment.