The July 20 executive order tightens waiver discipline under 10 U.S.C. 4872: specialty metals, critical minerals, defense-critical materials. Not batteries. Section 4865 appears nowhere in the order's text, fact sheet, or definitions. No battery, cell, FEOC, or lithium-ion language is present.
Under 4872, from January 1, 2027, no waiver issues without an accepted mitigation plan containing four elements: noncompliant source identification, documented exhaustive search for compliant supply, removal steps, and a strict timeline. A contractor's failure to qualify a domestic source does not constitute non-availability unless "active, adequately funded, and ongoing efforts" are demonstrated. Fraud in a mitigation plan triggers DOJ referral directly.
Separately, the order mandates indentured bills of materials traced to raw material origin, with guidance due within 180 days.
What matters for this section is the waiver mechanism itself. The burden across defense sourcing is moving from assertion to documentation. Contractors will need to prove what they did to find compliant supply, not explain why it was unavailable. That operational shift, once live under 4872, will shape how contractors approach battery supply chain representations well before Section 4865 is formally addressed. Section 4865 analysis runs in the Mandate Gap feature alongside this piece.
Statute targeted: 10 U.S.C. 4872 (specialty metals, critical minerals). Not 4865 (batteries).
Waiver cutoff: January 1, 2027 — no waivers without accepted mitigation plan.
Mitigation plan must include:
- Noncompliant source identified by name
- Evidence of exhaustive compliant-source search
- Steps to remove noncompliant material
- Strict implementation timeline
Antiavoidance clause: Passive failure to qualify a domestic source ≠ non-availability. Active, funded qualification efforts required.
BoM traceability: Full indentured bill of materials to raw material origin. Guidance due ~January 2027; implementing regs 90 days after.
Enforcement teeth: Fraud or deliberate misleading → contractual remedies + Attorney General referral.
Reporting: Secretary of War reports to President every six months through January 2028 on waiver use and mitigation plan progress.
Navarro framing: "No more: 'we tried nothing and we're out of options'" (Reuters, July 20).