Forward lock means that your application offers no way to use protected content on other devices. Literally this means that your application must not have functionality for forwarding (sending) protected content to other devices or for writing to a file system or something else like that. For an open platform like Android that as well might require encrypting/obfuscating your applications content store to prevent access from other apps or from a USB-connected host computer.
A forward lock is identified by a flag in the media metadata (format is media-dependent IMHO). The content is not encrypted. Thus a forward lock is a simple check per content item to disable forwarding functionality as needed.
The whole concept came from and worked with closed embedded devices (like typical mobile phones 5 years ago) and sounds strange with open platforms like Android.