The bill, H.B. No. 2409, seeks to prohibit governmental contracts with companies that are scrutinized due to their ties to the People's Republic of China, specifically in the realm of information and communications technology. It amends Chapter 2275 of the Government Code to include a new subchapter dedicated to this prohibition, defining terms such as "scrutinized company" and outlining the conditions under which a governmental entity may contract with such companies. The bill establishes that a vendor must provide written verification that they are not a scrutinized company and will not engage with one for any aspect of the contract.

Additionally, the bill introduces civil and criminal penalties for violations of these provisions. A vendor found to be in violation may face a civil penalty equal to either twice the amount of the terminated contract or the state's loss from the termination. Furthermore, a violation constitutes a state jail felony. The bill is set to take effect on September 1, 2025, and applies only to contracts for which bids or proposals are made public after this date.

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