Bill · H.R. 7424· House(119-HR-7424)
American Business for American Companies Act of 2026
- Introduced
- 2/9/2026
- Last activity
- 2/9/2026 — Referred to the Committee on Oversight and Government Reform, and in addition to the Committee on Armed Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- Sponsored by
- Rosa DeLauro
- Cosponsors
- None
- Introduced
- In Committee
What this bill would do
The "American Business for American Companies Act of 2026" aims to stop the federal government from giving contracts to inverted domestic corporations. This includes prohibitions on awarding contracts to specific foreign incorporated entities, their subsidiaries, or certain joint ventures. The bill also requires specific clauses in high-value contracts to limit subcontracts involving these entities. It defines an inverted domestic corporation based on specific acquisition and management criteria. Agency heads may issue waivers for national security or specific public health program needs.
Yes· 3 of 5
Would business owners be better off under this?+2
The restriction on inverted domestic corporations may benefit domestic-based business owners seeking federal contracts.
Does this make it easier to run a small business?+2
The bill limits the ability of larger, foreign-incorporated entities to capture federal subcontracts, which may leave more room for domestic companies.
Does this make what the government does easier for the public to see?+2
The bill requires agency heads to report any contract-related waivers to Congress within 14 days.
The opposite
No question was scored the opposite.
Who it would affect, and how
Potential Positive Impacts for People
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Contract Restrictions: The bill prohibits the head of an executive agency from awarding contracts for property or services to an inverted domestic corporation or its subsidiaries (Section 2(a)(1)(A)). This prevents specific foreign entities from receiving federal funds.
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Subcontracting Limits: For contracts valued over $10,000,000, prime contractors are prohibited from awarding first-tier subcontracts greater than 10 percent of the total contract value to an inverted domestic corporation (Section 2(a)(1)(A)(2)). This prevents companies from using these entities through lower-tier subcontracts.
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Accountability through Penalties: If a prime contractor violates the subcontracting rules, the contract may be terminated for default or the company may face suspension or debarment (Section 2(a)(1)(A)(2)(B)). This provides a mechanism to hold contractors accountable to the law.
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Flexibility for Critical Needs: Agency heads can waive these prohibitions if it is required for national security or the efficient administration of public health programs (Section 2(a)(1)(C)).
Potential Negative Impacts for People
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Contract Termination Risks: Prime contractors that violate the subcontracting clauses face the risk of their contracts being terminated for default (Section 2(a)(1)(A)(2)(B)).
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Debarment Risks: Violations of the subcontracting rules may result in a contractor being referred to a debarment official, which could lead to the suspension or debarment of the prime contractor (Section 2(a)(1)(A)(2)(B)).
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Impact on Existing Orders: The rules apply to any task or delivery order issued after the date of enactment, even if the original contract was entered into before the law was passed (Section 2(a)(1)(D)(2)).
Groups and Interests Ranking
Every group the model scored this bill for, from -10 to +10. Hover a score for the reason it gave.
- Demographic And Interest Groups
- Good For Business Owners+2
- Economy And Finance
- Improves Small Business Support+2
- Governance And Ideology
- Improves Government Transparency+2
- Healthcare
- Improves Healthcare Access+1
- National Security And Foreign Policy
- Improves Veterans Benefits+1
- 2/9/2026
- Referred to the Committee on Oversight and Government Reform, and in addition to the Committee on Armed Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- Introduced in House
One bill Congress.gov lists as related to this one — companions in the other chamber, earlier versions, and bills this one absorbed or was folded into.