Electronic Components The hot topic at the moment is counterfeited components in the supply chain.

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As 2012 takes off, the World Semiconductor Trade Statistics (WSTS) organization has released figures that show the semiconductor global sales for 2011 have broken the record set in 2010 and global sales have gone over the $302 billion dollar mark, representing a 1.3% increase on 2010 sales. While sales records are getting broken, the hot topic at the moment, especially in the United States, is counterfeited components in the supply chain for the manufacturing and repairs of military equipment.

Recently there was a senate hearing in which testimonies were heard regarding counterfeited components found in Defense equipment that was already built and in use in military equipment. Investigations were made and had the electronic parts traced back to their source in China. Senators Carl Levin and John McCain have been leading the way in the investigation and legislation changes which have seen the senate approve an amendment to strengthen protections against counterfeit electronic components from entering the defense supply chain. The amendment is to be made to the National Defense Authorization Act for fiscal year 2012.


"These counterfeit parts endanger our troops, harm national security and cost taxpayers," Levin said. "The flood of counterfeit parts must stop, and this amendment provides tools and incentives that will help stop it."
"Counterfeit parts pose an increasing risk to our national security, to the reliability of our weapons systems and to the safety of our men and women in uniform," McCain said. "We cannot risk a ballistic missile interceptor missing its target, or a helicopter pilot unable to fire his weapons, or display units failing in aircraft cockpits, or any other system failure, all because of a counterfeit electronic part. This legislation will inject some much needed integrity, transparency, and accountability into the defense supply chain, help customs officials intercept these counterfeits, and ensure that prosecutors bring the full weight of justice down on those who traffic in military counterfeits."


The Levin-McCain amendments to the National Defense Authorization Act are:


• Prohibits contractors from charging the Defense Department for the cost of fixing the problem when counterfeit parts are discovered.

• Requires the department and its contractors whenever possible to buy electronic parts from original component manufacturers and their authorized dealers or trusted suppliers who meet established standards for detecting and avoiding counterfeit parts.

• Requires military officials and contractors who learn of counterfeit parts in the supply chain to provide written notification to the contracting officer, the Department of Defense Inspector General and to the Government-Industry Data Exchange Program.

• Requires the Secretary of Homeland Security to establish a methodology for the enhanced inspection of electronic parts after consulting with the Secretary of Defense as to the sources of counterfeit parts in the defense supply chain.

• Requires large defense contractors to establish systems for detecting and avoiding counterfeit parts, and authorizes reductions in contract payments to contractors who fail to do so.

• Requires DoD to adopt policies and procedures for detecting and avoiding counterfeit parts in its direct purchases, and for assessing and acting on reports of counterfeits.

• Adopts provisions of a bill sponsored by Sen. Sheldon Whitehouse, D-R.I., to toughen criminal sentences for counterfeiting of military goods or services.

• Requires DoD to define the term "counterfeit part," and at a minimum to include in that definition previously used parts represented as new.

Electronic component and semiconductor distributors and leader in coaxial cable supply are also taking an active part in the fight against counterfeiting components entering any supply chain by using up-to-date processes in sourcing their catalogue items.

 

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