A recently-passed US law on counterfeit electronics could lead manufacturers in Europe to overhaul the way their supply chains are managed.
Research firm IHS said that with the passage of the 2012 National Defense Authorization Act (NDAA) firms who supply electronics systems to the US military will be forced to take additional steps to verify the authenticity of the parts they use.
The act, which forbids the government from purchasing any system found to be using counterfeit components, looks to keep untested and unreliable counterfeit hardware off of US military systems and networks.
IHS believes that as a result of the deal, contractors who work with the military will need to make sure their supply chains are verified and authenticated or risk losing their lucrative supply contracts with the US government.
The deal looks to have a major impact on EU firms in particular. The company estimates that as many as 283 EU-based companies currently have contracts with the US military which would be impacted by the law.
In total, researchers estimate that US military contracts bring those European firms revenues in excess of $1bn and account for more than 50 per cent of their total revenues.
Ultimately, analysts believe that the NDAA will trigger industry-wide reform much as the hazardous substance laws in the EU have.
"There is a perception that US regulations such as 2012 NDAA is only an issue for American companies, and that they don’t impact firms in Europe," said IHS senior product manager for supply chain solutions Greg Jaknunas.
"However, the impact is beginning to be felt worldwide, as many international companies and global manufacturing facilities can directly participate in the defence supply chain and begin to see customer requests for counterfeit detection and avoidance measures that are flowed down through the supply chain."
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