Basically, if you are a federal contractor, the designation means the DoD can force you to certify that Anthropic tech is not used in the fulfillment of your government work. Because it's just a DoD designation, and an executive order and not added to the NDAA, you can still use Claude for non-government (federal) touching work.
So using Claude Code to write software for the DoD is now a no go, you'd be in breach of procurement directives now.
If they go as far as to convince congress to add Anthropic to the NDAA, that would be a nationwide ban like Huawei making it illegal for any federal contractor to use the tech anywhere in their business.
But for now, even fed contractors can still use Claude in their business, just not directly for government work.
That doesn’t seem to match up with the original tweet though - it sounds a heck of a lot stronger:
> Effective immediately, no contractor, supplier, or partner that does business with the United States military may conduct any commercial activity with Anthropic
Emphasis mine.
And I’m looking at news organizations that presumably have staffs of legal analysts pouring over this stuff, and they also seem to be saying that it can’t be any commercial activity:
> The label means that no contractor or supplier that works with the military can do business with Anthropic.
Ok Looking at Anthropic’s response they agree with the parent response:
> Secretary Hegseth has implied this designation would restrict anyone who does business with the military from doing business with Anthropic. The Secretary does not have the statutory authority to back up this statement. Legally, a supply chain risk designation under 10 USC 3252 can only extend to the use of Claude as part of Department of War contracts—it cannot affect how contractors use Claude to serve other customers.
So using Claude Code to write software for the DoD is now a no go, you'd be in breach of procurement directives now.
If they go as far as to convince congress to add Anthropic to the NDAA, that would be a nationwide ban like Huawei making it illegal for any federal contractor to use the tech anywhere in their business.
But for now, even fed contractors can still use Claude in their business, just not directly for government work.