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Prohibition on Government Contracts for Inverted Domestic Corporations

This act prohibits the awarding of federal government contracts (civilian and defense) to foreign incorporated entities determined to be inverted domestic corporations and their subsidiaries. The ban also extends to joint ventures where such entities hold more than 10 percent ownership. The act mandates that prime contractors must not subcontract with such entities in contracts valued over $10 million, under penalty of contract termination or debarment.
Key points
Executive agencies may not award procurement contracts to inverted domestic corporations.
The prohibition extends to joint ventures if more than 10 percent is owned by an inverted domestic corporation.
Contracts exceeding $10 million (excluding commercial items) must include a clause prohibiting subcontracting more than 10 percent of the value to such entities.
Violations by the prime contractor may result in contract termination for default or suspension/debarment.
Waivers are permitted for national security interests or efficient administration of health programs.
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Expired
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Additional Information
Print number: 117_S_2124
Sponsor: Sen. Durbin, Richard J. [D-IL]
Process start date: 2021-06-17
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OFFICIAL LEGAL TITLE

American Business for American Companies Act of 2021

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 117_S_2124.

Which chamber initiated this legislation?

This legislation was initiated in the Senate.

When did the legislative process begin?

The process officially started on 2021-06-17.

What are the main provisions?

Key points include:

  • Executive agencies may not award procurement contracts to inverted domestic corporations.
  • The prohibition extends to joint ventures if more than 10 percent is owned by an inverted domestic corporation.
  • Contracts exceeding $10 million (excluding commercial items) must include a clause prohibiting subcontracting more than 10 percent of the value to such entities.
  • Violations by the prime contractor may result in contract termination for default or suspension/debarment.
  • Waivers are permitted for national security interests or efficient administration of health programs.
What is the specific legal status?

The current status is Expired.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Sen. Durbin, Richard J. [D-IL].

What is the latest detailed status?

The latest detailed status is: Introduced in Senate

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2026-01-02.

CATEGORIES

Economy Public Investments Taxes