Critical Defense Ownership Review Act

The Critical Defense Ownership Review Act requires the Department of Defense to review any attempt by an investment company to acquire at least a 25 percent stake or control of a major defense supplier. Under this law, such transactions must undergo a premerger notification process where the Department evaluates national security risks, competition impacts, and the financial stability of the involved companies. If the Department identifies concerns, it must report its findings to federal antitrust authorities within 30 days. Additionally, the bill mandates a triennial review every three years to assess how mergers and acquisitions affect the health of the defense industrial base, with results reported to Congress. These provisions directly impact investment firms seeking to invest in defense contractors and aim to ensure the continued reliability of critical military supply chains.