Comment on FR Doc # 2026-09067

Subject: Comment on DFARS Case 2021-D011 — Mitigating Risks Related to Foreign Ownership, Control, or Influence (91 FR 24783) To the Defense Acquisition Regulations System: I submit this comment regarding 91 FR 24783, extending FOCI disclosure and mitigation requirements to unclassified defense contracts valued above $5 million. I write as an investigative journalist, technology historian, and private business operator. I. The Legitimate Purpose and Structural Risk While supply chain security is a genuine national security concern, the proposed rule contains structural vulnerabilities that could transform a defensive measure into an offensive competitive weapon. I urge the Department to address these prior to finalization. II. The “Designated Senior Official” Problem The rule exempts commercial products/services unless a “designated senior DoD official” determines a contract involves a "risk to national security." This provision fails to: • Identify the required administrative level of this official • Publish criteria for the risk determination • Require documented justification • Provide prior notice to the affected company • Establish an appeal mechanism In the current AI procurement environment—where a single Commerce official banned a deployed AI model in 90 minutes on June 12, 2026, and approved a competitor’s on June 26—this creates an obvious mechanism for selective enforcement. The Department must not create another unchecked power over commercial AI market access. III. The AI Safety Governance Paradox Companies investing in responsible AI governance (international advisory boards, foreign-national safety researchers, international PBCs or Long-Term Benefit Trusts) are structurally more likely to trigger FOCI review. Their governance ensures safety through diverse oversight. Under this rule, those structures become a procurement liability, creating a perverse incentive: companies wanting defense contracts should avoid international safety governance. The rule punishes responsible development while rewarding less accountable, purely domestic structures. IV. DCSA Capacity and De Facto Exclusion Expanding DCSA's 2,000 annual FOCI cases to an estimated 41,000 (a 1,950% increase) without a staffing plan, resource allocation, or interim processing guarantee will guarantee massive delays. For the 21,511 affected small businesses, processing delays equal de facto market exclusion. A company cannot receive a contract award without “eligible” NISS status. The 90-day mitigation deadline is meaningless if DCSA takes 18 months to process determinations. V. Recommendations Define and publish criteria for the commercial exemption override, including evidentiary standards, the authorizing official's level, and documentation requirements. Establish a formal notice-and-comment process (minimum 30 days) before any override takes effect. Create an independent appeal mechanism allowing contractors to challenge FOCI determinations. Exclude AI safety governance structures (international boards, foreign-national safety researchers, and international trusts/PBCs) from FOCI triggers. Publish a DCSA capacity plan with binding timelines, establishing a presumption of eligibility if DCSA fails to act within 90 days. Require annual congressional reporting on commercial exemption overrides and outcomes for affected companies. The Department has a legitimate interest in supply chain security, but not in creating a mechanism for selective exclusion of disfavored vendors. Without these safeguards, the rule risks becoming the latter. Respectfully submitted, Anonymous investigative journalist and technology historian