12 2 STA T .45 41 PUBLIC LA W 11 0– 41 7—O CT. 14 , 200 8thecon t ra ctor an d the D e p art m ent o f Defen s e i n u sin g off - shore su b sidiaries , particu l arl y in respect to —(1) ta x liability (including corporate income taxes and pay- roll taxes)
( 2 ) legal liability; ( 3 ) compliance w ith cost accounting standards; ( 4 ) efficiency in contract performance; ( 5 ) contract management and contract o v ersight; and ( 6 ) such other areas as the C omptroller G eneral determines appropriate .SEC.845 . D E F E N SE I ND U S TR I AL SECURIT Y . (a) D EF E NS E I N DU S TRIALS E C URIT Y .— (1) IN G ENERAL.—Subchapter I of chapter 21 of title 1 0 , U nited States Code, is amended by adding at the end the following new section
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‘ §438.Def e ns e i n du s tr i al se c urit y‘ ‘(a) R ES PO NSI B ILITY FOR DEFENSE INDUSTRIAL SECURITY.— T he Secretary of Defense shall be responsible for the protection of classi- fied information disclosed to contractors of the Department of Defense. ‘‘(b) CONSISTENCY W IT HEX ECUTI V E O RDERS AND DIRECTIVES.— The Secretary shall carry out the responsibility assigned under subsection (a) in a manner consistent with Executive Order 12 8 2 9 (or any successor order to such executive order) and consistent with policies relating to the N ational Industrial Security P rogram (or any successor to such program). ‘‘(c) PERFOR M ANCE OF INDUSTRIAL SECURITY F UNCTIONS FOR OTHER A GENCIES.—The Secretary may perform industrial security functions for other agencies of the Federal government upon re q uest or upon designation of the Department of Defense as executive agent for the National Industrial Security Program (or any successor to such program). ‘‘(d) REGULATIONS AND POLICY GUIDANCE.—The Secretary shall prescribe, and from time to time revise, such regulations and policy guidance as are necessary to ensure the protection of classified information disclosed to contractors of the Department of Defense. ‘‘(e) DEDICATION OF RESOURCES.—The Secretary shall ensure that sufficient resources are provided to staff, train, and support such personnel as are necessary to fully protect classified informa- tion disclosed to contractors of the Department of Defense. ‘‘(f) B IENNIAL REPORT.—The Secretary shall report biennially to the congressional defense committees on expenditures and activi- ties of the Department of Defense in carrying out the requirements of this section. The Secretary shall submit the report at or about the same time that the President ’ s budget is submitted pursuant to section 1105(a) of title 31, United States Code, in odd numbered years. The report shall be in an unclassified form (with a classified annex if necessary) and shall cover the activities of the Department of Defense in the preceding two fiscal years, including the following: ‘‘(1) The wor k force responsible for carrying out the require- ments of this section, including the number and experience of such workforce; training in the performance of industrial security functions; performance metrics; and resulting assess- ment of overall quality. Clas s if i ed i n f orm a t ion .
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