Overview
FAR 25.103 identifies specific conditions under which contracting officers are exempt from the Buy American statute’s requirement to acquire domestic end products. These exceptions allow for the procurement of foreign goods when domestic options are unavailable, too costly, or inconsistent with the public interest.
Key Rules
- Public Interest: The head of an agency may waive domestic preference if it is deemed inconsistent with the public interest, often due to existing international trade agreements.
- Nonavailability: Domestic preferences do not apply if the required items are not available in sufficient commercial quantities or satisfactory quality.
- Class Determinations: Items listed in FAR 25.104 are pre-determined to be unavailable, though contracting officers must still conduct market research for end products or significant components.
- Individual Determinations: The Head of the Contracting Activity (HCA) can determine an item is unavailable; however, written determinations are waived if a full and open competition is held, synopsized, and yields no domestic offers.
- Unreasonable Cost: If the cost of a domestic end product is determined to be unreasonable based on the price adjustment factors in FAR 25.106 and 25.5, foreign products may be acquired.
- Commercial Information Technology (IT): A broad exception exists for the acquisition of commercial IT products using funds from FY 2004 or later.
- Resale: Items purchased specifically for resale in commissaries (e.g., military grocery stores) are exempt.
Practical Implications
- The "Commercial IT" exception is a powerful tool that simplifies the procurement of global technology products, as it removes the need for complex domestic content analysis for most software and hardware.
- Contracting officers must maintain rigorous documentation; if a domestic source is discovered before the bid closing date for an item on the "Nonavailability" list, the exception is voided, and the Buy American clauses must be reinstated.