Controlled Unclassified Information

Data and its protection are vital in today’s high-stakes electronics industry. This is especially true for manufacturers and suppliers working with government contracts, specifically those tied to the Department of Defense (DoD). In this sector, understanding how to protect Controlled Unclassified Information (CUI) is a non-negotiable requirement. But what is CUI, and why does it carry so much weight in defense contracts? In today’s article, we’ll break down the essentials of CUI, from its definition and the regulations that govern it to the specific type of information it covers and how it impacts electronics industry stakeholders.

Controlled Unclassified Information (CUI) refers to information the government owns, creates, or that an organization creates or possesses on behalf of the government. While it is not classified, it still requires safeguarding and dissemination controls in accordance with applicable laws, regulations, and government policies. Protecting CUI is essential for preventing unauthorized user access and ensuring sensitive data is handled securely within federal and contractor systems.

In 2009, the National Archives and Records Administration (NARA) experienced a major data breach that threatened the records of countless military veterans. In response, Executive Order 13556, i.e., “Controlled Unclassified Information,” was issued, effectively establishing the first program to manage CUI. Since then, the department has continued to improve standards for protecting sensitive information, including informing contractors about what is necessary to safeguard CUI in the face of increased cyber risks.

The regulatory framework that governs CUI is guided by the National Institute of Standards Technology (NIST) 800-171, which outlines the required security controls for protecting CUI in non-federal systems and organizations, such as those in the electronics industry that handle government contracts. NIST 800-171 includes 14 key areas of information security, including access control, incident response, system integrity, and risk assessment. Compliance ensures that sensitive, unclassified data is protected from unauthorized access, breaches, or misuse.

What is considered CUI data? Various types of CUI are relevant to the electronics industry, each carrying unique risks and compliance requirements. Therefore, electronics suppliers and manufacturers executing defense-related contracts must implement robust information security measures for the specific data handled to remain compliant. 

CTI includes scientific, engineering, and technical data used in military or defense-related applications, such as technical manuals, blueprints, engineering schematics, software code, or research data.

This type of CUI falls under export control laws, such as the International Traffic in Arms Regulation (ITAR) and Export Administration Regulations (EAR). It includes information related to weapons, military technology, and sensitive dual-use technology designs, i.e., technologies that have both civilian and military applications.

This covers CUI related to financial data associated with government contracts, such as procurement transactions, budgeting information, contract pricing, and government contracts (bank numbers, procurement details, contract pricing).

Compliance with CUI regulations is non-negotiable for electronics industry contractors interested in securing government contracts. Adhering to the required security controls protects sensitive information while strengthening the company’s reputation for security and reliability. Furthermore, non-compliance can have serious consequences, including the loss of lucrative DoD contracts, legal penalties, and potential cyber vulnerabilities. Failing to comply can also erode trust with supply chain partners and consumers, potentially impacting a company’s market position and bottom line.

Managing CUI effectively requires a multi-layered, proactive approach to security and compliance, beginning with understanding the NIST 800-171 standards. Steps to ensure robust compliance and protection include:

• Access Controls - ensure only authorized personnel can handle sensitive data, including permission updates as roles change.
• Data Encryption - data at rest and in transit should be encrypted to protect against breaches, including continuous monitoring systems to respond to potential threats in real-time.
• Personnel Training - ensure staff undergoes controlled unclassified information training and understands CUI handling protocols and the necessity of compliance.
• Regular Auditing - continuous assessments can help identify vulnerabilities while keeping systems aligned with NIST 800-171 standards.
• Clear Documentation - maintain clear records of compliance processes and incident responses. In cases of audits, this demonstrates accountability and readiness.

For electronics suppliers and manufacturers, defense-related projects offer highly lucrative opportunities. However, they come with strict requirements for vigilant information protection. Handling CUI demands robust security measures and full compliance with government regulations to safeguard sensitive data. Furthermore, companies incorporating regulated data protection safeguards position themselves not only for sustained growth and access to valuable government contracts - but also for stronger resilience against the rising tide of cyber threats in today’s increasingly digital landscape.

At Peerless Electronics, we strive to be at the forefront of the latest quality and security protocols. To this end, we proactively completed a Joint Surveillance Voluntary Assessment (JSVA) in October 2024, achieving a perfect score of 110, confirming our full compliance with the cybersecurity requirements outlined in NIST SP 800-171. This achievement positioned us for CMMC Level 2 certification, ensuring we are a trusted source for DoD-compliant components while offering our partners confidence in the quality and security of the products we supply.

What is Controlled Unclassified Information (CUI) data?

Controlled Unclassified Information (CUI) is sensitive government-related data that requires safeguarding but isn’t classified, such as technical, export-controlled, and financial information.

What level of system and network is required for CUI?

Systems handling CUI must meet the cybersecurity standards outlined in NIST SP 800-171, which includes 110 security controls.