Overview
FAR 25.400 defines the scope of Subpart 25.4 by identifying the specific international trade agreements and legislative mandates that govern U.S. Government procurement. It establishes which foreign end products, services, and construction materials must receive non-discriminatory treatment under the Trade Agreements Act and related authorities.
Key Rules
- International Frameworks: The subpart applies to acquisitions covered by the World Trade Organization Government Procurement Agreement (WTO GPA) and the Agreement on Trade in Civil Aircraft.
- Free Trade Agreements (FTAs): It lists 12 specific bilateral and multilateral FTAs, including the USMCA (limited to U.S. and Mexico for procurement purposes), CAFTA-DR, and individual agreements with nations such as Australia, Korea, and Chile.
- Developmental Designations: The subpart covers special procurement treatment for "least developed countries" and beneficiaries of the Caribbean Basin Trade Initiative (CBTI).
- The Israeli Trade Act: Specific policies are included regarding the U.S.-Israel Free Trade Area Agreement.
- Agency Supplementation: For trade agreements unique to a specific agency (rather than government-wide), users must consult individual agency-level regulations.
Practical Implications
- Buy American Act Waivers: When an acquisition is covered by one of these listed agreements and exceeds specific dollar thresholds, the Buy American statute is typically waived, allowing eligible products from these countries to compete on an equal footing with domestic products.
- Compliance Check: Contracting Officers must use this list as a primary reference to determine if a foreign offeror’s product qualifies for "eligible product" status, which prevents the application of the standard price penalty imposed on foreign goods.