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US Department of War suspends costly CMMC Phase II cybersecurity rules for small defense contractors.

Market News
13 Jul 2026
U.S. Small Business Administration
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Neutral
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The U.S. Department of War has suspended the Cybersecurity Maturity Model Certification (CMMC) Phase II requirements originally set for November 2026, following concerns from small defense contractors about high compliance costs and bureaucratic burdens. The suspension aims to preserve strong cybersecurity while reducing regulatory barriers that threaten to push small businesses out of the Defense Industrial Base, which is vital for national security. The Department will conduct a comprehensive review to balance cybersecurity needs with the goal of expanding and modernizing the defense supply chain. This move is supported by the U.S. Small Business Administration, which highlighted that compliance costs could reach up to $600,000 per firm, risking delays and lost competition for critical defense contracts.

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