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Published by J9 Systems. What's new in business tech, and what it means for yours.

From the brief of Wednesday, October 21, 2026 · No. 10

From the daily brief · AI

DHS orders federal civilian agencies to drop DeepSeek AI and tools built on it

The ban covers government systems, not your business, but federal suppliers may soon be asked whether any of their AI tools run on DeepSeek.

By Carter Josephson · · 1 min read

What happened

On Oct. 20, 2026, the Department of Homeland Security published an order directing federal civilian agencies to stop buying DeepSeek products and services and to remove them from government IT systems, citing concerns that U.S. government data could be accessible to Chinese authorities under Chinese law. The order also covers third-party products and services built using DeepSeek technology, and agencies can request exceptions.

What it means for a 10-to-50-person business

The order binds federal civilian agencies, not private businesses, so for most readers the effect is small. It matters if you sell to those agencies, because the ban reaches third-party products built on DeepSeek technology, not just DeepSeek's own app. Example: a 28-person electrical contractor with a $350,000 subcontract on a federal office renovation uses an AI estimating add-on and a chatbot on its website. Neither touches agency IT systems, so the order does not apply to them directly. But if the contractor supplies software or hosted services to the agency, or a prime contractor sends a supply-chain questionnaire, it will need to say whether any tool runs on DeepSeek. Finding out takes about an hour: list your AI tools and automations and email each vendor asking which models they use. Some automation and chatbot tools let users pick a DeepSeek model, so check your own settings too. Shops with no federal work can ignore this. DHS's data concern is still a fair prompt for any firm holding client data to know where its AI tools send it.

What to do
Ignore

If you have no federal work, ignore this; if you sell to federal civilian agencies, spend an hour this month listing your AI tools and getting each vendor's written answer on whether they use DeepSeek models.

What it costs
What it costs
Inventory AI tools and email vendors, 1 office manager
1 hr (≈ $50 at $50/hr)
Replace a DeepSeek-based tool, only if you find one
2–4 hrs setup (≈ $100–$200 at $50/hr); price difference depends on the replacement
Doing nothing
$0 for firms with no federal work; federal suppliers risk not being able to answer a customer questionnaire quickly
Sources
federalregister.gov (primary) · US orders federal agencies to remove China's DeepSeek AI from their systems (TechCrunch) · Anthropic: Detecting and preventing distillation attacks

Questions owners ask

Does this order ban my business from using DeepSeek?

No. It applies to federal civilian agencies' purchases and IT systems. Private businesses are not covered by this order.

How would I know if a tool I use is built on DeepSeek?

Ask the vendor in writing which AI models their product uses, and check the model setting in any chatbot or automation tool you configured yourself.

Three to five of these, every weekday morning.

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