The current administration has been clear in its attempt to scale back on onerous compliance requirements, as part of an ongoing overhaul of federal acquisition policy. The 2026 National Defense Authorization Act (NDAA),1 signed in to law in December 2025, materially reduces certain compliance burdens for nontraditional defense contractors (NDCs).2 More importantly, it offers a clearer path for pathway for traditional defense contractors to capture those same advantages through affiliates, subsidiaries, or discrete business units that may independently qualify as NDCs.
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