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Title 10 — Armed ForcesRelease 119-73

§4981 Establishment of loan guarantee program

Title 10 › Subtitle Subtitle A— - General Military Law › Part PART V— - ACQUISITION › Subpart Subpart I— - Defense Industrial Base › Chapter CHAPTER 389— - LOAN GUARANTEE PROGRAMS › Subchapter SUBCHAPTER II— - CRITICAL INFRASTRUCTURE PROTECTION LOAN GUARANTEES › § 4981

Last updated Apr 6, 2026|Official source

Summary

The Secretary of Defense must set up a loan guarantee program to help protect national security goals in section 4811(a). The program will guarantee loans so lenders do not lose loan principal, interest, or both, for loans to companies that pay for improving or refinancing protection of their critical infrastructure. A “qualified commercial firm” must meet five main requirements, including doing major research, engineering, or manufacturing in the United States; being mostly U.S.-owned (or having a parent in a country that supports such firms’ R&D partnerships and protects U.S. intellectual property); supplying technology important to the Department of Defense; meeting DoD cyber-prevention rules; and agreeing to file the report required by section 4985. The total guaranteed principal in any fiscal year cannot exceed $10,000,000 for all borrowers. The Secretary must create rules that set goals and ways to check recipients, and guarantees can only be made to the extent Congress provides money in advance in appropriations Acts.

Full Legal Text

Title 10, §4981

Armed Forces — Source: USLM XML via OLRC

(a)In order to meet the national security objectives in section 4811(a) of this title, the Secretary of Defense shall establish a program under which the Secretary may issue guarantees assuring lenders against losses of principal or interest, or both principal and interest, for loans made to qualified commercial firms to fund, in whole or in part, any of the following activities:
(1)The improvement of the protection of the critical infrastructure of the commercial firms.
(2)The refinancing of improvements previously made to the protection of the critical infrastructure of the commercial firms.
(b)For purposes of this section, a qualified commercial firm is a company or other business entity (including a consortium of such companies or other business entities, as determined by the Secretary) that the Secretary determines—
(1)conducts a significant level of its research, development, engineering, and manufacturing activities in the United States;
(2)is a company or other business entity the majority ownership or control of which is by United States citizens or is a company or other business of a parent company that is incorporated in a country the government of which—
(A)encourages the participation of firms so owned or controlled in research and development consortia to which the government of that country provides funding directly or provides funding indirectly through international organizations or agreements; and
(B)affords adequate and effective protection for the intellectual property rights of companies incorporated in the United States;
(3)provides technology products or services critical to the operations of the Department of Defense;
(4)meets standards of prevention of cyberterrorism applicable to the Department of Defense; and
(5)agrees to submit the report required under section 4985 of this title.
(c)The maximum amount of loan principal guaranteed during a fiscal year under this section may not exceed $10,000,000, with respect to all borrowers.
(d)The Secretary shall prescribe regulations setting forth goals for the use of the loan guarantees provided under this section and standards for evaluating whether those goals are met by each entity receiving such loan guarantees.
(e)The Secretary may guarantee a loan under this subchapter only to such extent or in such amounts as may be provided in advance in appropriations Acts.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Amendments

2021—Pub. L. 116–283, § 1873(b), (c)(2), renumbered section 2541 of this title as this section. Subsec. (a). Pub. L. 117–81, which directed the substitution of “section 4811(a)” for “section 2501(a)”, could not be executed in introductory provisions because of the intervening amendment by Pub. L. 116–283, § 1883(b)(2). See note below. Pub. L. 116–283, § 1883(b)(2), substituted “section 4811(a)” for “section 2501(a)” in introductory provisions. Subsec. (b)(5). Pub. L. 116–283, § 1873(e)(1), substituted “section 4985” for “section 2541d”.

Statutory Notes and Related Subsidiaries

Effective Date

of 2021 AmendmentAmendment by Pub. L. 117–81 to take effect immediately after the

Amendments

made by title XVIII of Pub. L. 116–283 have taken effect, see section 1701(a)(3) of Pub. L. 117–81, set out in a note preceding section 3001 of this title and note below. Amendment by Pub. L. 116–283 effective Jan. 1, 2022, with additional provisions for delayed implementation and applicability of existing law, see section 1801(d) of Pub. L. 116–283, set out as a note preceding section 3001 of this title.

Reference

Citations & Metadata

Citation

10 U.S.C. § 4981

Title 10 — Armed Forces

Last Updated

Apr 6, 2026

Release point: 119-73