The bill, S.B. No. 1585, aims to prohibit governmental contracts with companies identified as foreign adversaries in relation to critical infrastructure and information and communications technology. It amends Chapter 2275 of the Government Code to include new definitions and provisions regarding "scrutinized companies," which are defined as entities organized in or under the laws of a foreign adversary or those that are subject to significant control by such governments. The bill establishes a framework for governmental entities to verify that vendors are not scrutinized companies before entering into contracts, and it outlines the consequences for violations, including civil penalties and criminal offenses.

Key provisions include the requirement for vendors to provide written verification that they are not scrutinized companies and will not engage with such companies in fulfilling their contracts. If a vendor is found to have provided false verification, the governmental entity must terminate the contract and may refer the matter for enforcement. The bill also allows the governor to designate countries as foreign adversaries and sets forth penalties for violations, including civil penalties equal to twice the amount of the terminated contract or the state's loss from the termination, and criminal penalties classified as state jail felonies. The act is set to take effect on September 1, 2025.

Statutes affected:
Introduced: Government Code 2275.0101, Government Code 39.151 (Government Code 2275, Government Code 39)