U.S. Senate Committee on Small Business and Entrepreneurship Chair Joni Ernst (R-Iowa) and House Select Committee on China Chair John Moolenaar (R-Mich.) have reached out to the Pentagon seeking guidance on how Congress can address loopholes that may allow critical defense technology to be accessed by China.
The lawmakers' inquiry follows the Pentagon's acknowledgment of the need for reforms in the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs. The Department has agreed that establishing uniform foreign due diligence standards across government is necessary, as outlined in Senator Ernst’s INNOVATE Act.
In their letter, Ernst and Moolenaar stated: “The Trump administration has a chance to reverse Biden-era policies and strengthen American research security. Our review has identified recommendations to address shortcomings in Pentagon policy, due diligence, training, and access to critical information. We stand ready to assist and are committed to ensuring 100% of taxpayer dollars for critical technology development serves our warfighters and America’s national interest.”
Earlier this year, Senator Ernst released a report indicating that among 522 applications at the Pentagon flagged for foreign risk during 2023 and 2024, only 152 were denied based on those risks. The report also noted inconsistencies among agencies: some denied all flagged applicants while others denied less than one percent. The flagged risks included issues related to patents, employee analysis, financial ownership, or financial obligations.
