The Turn OFF THE TAP Act prevents the federal government from doing business with or sending money to certain entities that the U.S. has sanctioned or identified as threats. Specifically, it blocks federal agencies from signing contracts with these entities, and it also prevents any organization that receives federal funding from using that money to do business with, invest in, or otherwise support these sanctioned groups.

The law targets several categories of entities: companies and individuals on the Treasury Department's sanctions list (known as the SDN list), Chinese military companies identified by the government as threats to national security, companies on the Commerce Department's Entity List that pose export control concerns, and telecommunications equipment or service providers that the FCC has determined pose security risks to the U.S. It also covers any company that is owned by or controlled by any of these sanctioned entities.

In practical terms, this means federal agencies cannot hire contractors from these lists, federal grant recipients cannot spend their money with these entities, and the government is essentially cutting off all financial pathways to organizations it views as national security threats. The law is designed to strengthen U.S. sanctions enforcement by closing loopholes where federal money might indirectly support entities the government has already determined are dangerous or hostile to American interests.

Turn OFF THE TAP Act

Tenney, Claudia

Turn Off Federal Funding of Threatening Entities that Thwart American Prosperity Act or the Turn OFF THE TAP Act This bill prohibits certain entities from receiving federal funds or contracts from an executive agency. Specifically, this prohibition applies to (1) entities listed as specially designated nationals and blocked persons by the Office of Foreign Assets Control (OFAC) of the Department of the Treasury, (2) certain entities on the OFAC's Non-SDN Chinese Military-Industrial Complex Companies List, (3) entities identified on a Department of Defense list of Chinese military companies operating in the United States, (4) entities on the entity list maintained by the Bureau of Industry and Security of the Department of Commerce, and (5) entities identified by the Federal Communications Commission as a telecommunications equipment or service provider that pose an unacceptable risk to U.S. national security.