Defense Production Act

Country / jurisdiction: United States · Year: 2022 · Status: In force · Level: National · Type: Voluntary

The US Congress adopted the Defense Production Act in 1950 to provide authorities to the President to ensure the supply of materials and services necessary for national defense.

Under the Act, the President has access to an array of different actions. The main focus is on increasing domestic production of a specific good or service. Specifically, the President can direct private entities to give priority to purchases by the government for national defense. In addition, the President can waive international trade requirements in order to secure a supply chain from a foreign source, investigate certain firms, goods, or industries if necessary, and require the installation of certain equipment or other measures at production plants.

The original purpose of this act was to ensure the availability of materiel for military defense during the Korean War. However, it is also available to address other identifiable crises within the country within the jurisdiction of the law, including natural and man-made disasters. There have been several notable uses of the act beyond the traditional sphere of national defense. In 2000, President Bill Clinton invoked the act to secure the production of gas and electricity during a shortage in California. In 2011, President Obama invoked it due to growing concerns of espionage from China, making telecommunication companies report on their hardware and software components coming from a foreign source. President Trump invoked the act three times, once in 2017 and twice in 2020. In 2017, President Trump used the act to secure the supply of an array of products deemed critical for national defense – including microelectronics, aerospace structures, and satellite components. In March 2020, during the COVID-19 pandemic, President Trump invoked it to ensure production of ventilators and N95 Respirators. He then invoked it one more time in April 2020 to ensure the opening of plants of production for poultry, eggs, beef and pork during the pandemic. President Biden invoked the act in January 2021 to secure the production of COVID-19 vaccinations and in September 2021 to secure the production of fire hoses to mitigate the effects of wildfires around the country.

In recent years, the act has been seen as a potential mechanism for the government to address security of supply of critical minerals. In March 2022, President Biden signed Presidential Determination No. 2022-11 authorising the use of the act to strengthen the domestic battery capacity, including to direct increases in domestic mining and processing capacity for battery materials. Similarly, in June 2022, President Biden signed a series of Presidential Determinations invoking the Act to support domestic clean energy manufacturing and clean energy projects, including support for the manufacturing of heat pumps, electrolyzers, solar modules (and components), insulation material, and fuel cells; and waiver on solar panel imports from Cambodia, Malaysia, Thailand, and Vietnam. Details for these actions can be found as separate entries.

Official source: https://www.fema.gov/sites/default/files/2020-03/Defense_Production_Act_2018.pdf