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chrisp

Buy American Act for Construction Contracts Over Approx $7 Million

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Hi,

My understanding is that the Buy American Act allows construction contractors and their subcontractors to purchase materials from designated foreign countries (listed in FAR 25.003) so long as the total value of the acquisition meet the applicable threshold, 25.202?; 25.001(B); 25.402(a)(1), which for WTO countries is $7.4 Million

However, the trade agreements exception does not apply to small business set aside contracts, correct? 25.401(a)(1).

Additionally, we also know that there are differences for DOD contracts. DFARS 225.401-70 list the end products subject to trade agreements. One question here, does this only apply to DOD procurements of supplies or is it a general statement? We see that section 56 lists construction and building materials.

Any general knowledge filling in the gaps in our understandings would be greatly appreciated as well.

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Guest jrt132

Chrisp,

You are correct that the Trade Agreements Act waives the requirements of the Buy American Act under FAR 25.402(a)(1) when a Construction Contract is over $7,443,000. With the Buy American Act waived a contractor can now purchase supplies from designated foreign countries.

You are also correct in that the Trade Agreements Act does not apply to a Small Business Set Asides under FAR 25.401(a)(1). Now I think the question is does the Buy American Act now apply. My opinion would be it yes because none of the Buy American Act exemptions would apply under FAR 25.202.

I just read a great article in Contract Management Magazine by NCMA that discusses this exact topic. For more detail, look for a February 2010 issue page 16.

JRT

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The BAA clearly applies to small business set asides for supplies, correct? 25.101(B). We are just not sure if it applies to construction materials?

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Guest jrt132
The BAA clearly applies to small business set asides for supplies, correct? 25.101(B). We are just not sure if it applies to construction materials?

Take a look at FAR 25.200, Buy American Act - Constructions. That is the section for construction materials.

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Take a look at FAR 25.200, Buy American Act - Constructions. That is the section for construction materials.

Right. I have reviewed that. I just mean that the supplies section says specifically that it applies to small business set asides, but there is not a similar provision in the construction materials section. That lends credibility to your idea that the BAA may or may not apply to small business when they are buying construction materials.

We did a little more research. When it says that small businesses, war materials, etc . . . are an exception to the TAA in 25.401, does that in small business set asides the businesses can buy from any country? Does it mean they aren't given the benefits of the TAA, such that they can't purchase foreign materials from designated countries, or does it mean that they aren't subject to TAA requirements? Are they exempt such that they can buy from anywhere?

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Also if your customer is DoD, watch out for DFARS 252.225-7001, Buy American Act And Balance Of Payments Program, JUN 2005.

Follow the old rule of thumb: RTFC (read the f-f-f-f-full contract).

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