The proposed bill, HB2436, seeks to enhance restrictions on state contracts with "covered companies," which include state-owned enterprises of foreign adversaries, companies domiciled in foreign adversaries, federally banned corporations, and those controlled by foreign adversaries. Under the new regulations, these companies are prohibited from entering contracts with state agencies unless they can demonstrate the absence of reasonable alternatives and obtain preapproval from the Arizona Department of Administration (ADOA). Additionally, companies must certify that they are not covered companies and disclose any business operations with foreign adversaries within the past 24 months.

The bill introduces significant penalties for non-compliance, including civil penalties of $250,000 or double the contract amount, contract termination, and disqualification from bidding for at least sixty months. It also allows for post-factum submission of disclosures if a bid initially lacks them, which procurement officers may consider during evaluation. Overall, HB2436 tightens the existing procurement regulations by expanding the definition of covered companies and imposing stricter compliance and disclosure requirements to mitigate risks associated with foreign adversaries.

Statutes affected:
Introduced Version: 41-2559.01
House Engrossed Version: 41-2559.01