FAR 25.402 ties Buy American waivers to trade agreements, acquisition value, and service-origin rules; 52.225-5 defines designated-country products.
Summary
How do FAR trade-agreement rules affect Buy American compliance? FAR 25.402 ties Buy American waivers to trade agreements, acquisition value, and service-origin rules; 52.225-5 defines designated-country products.
According to FAR 25.402, the Trade Agreements Act gives the President authority to waive the Buy American statute and other discriminatory provisions for eligible products from countries that have signed an international trade agreement with the United States or meet other listed criteria, including least developed country status. The President delegated that waiver authority to the U.S. Trade Representative. Where an acquisition is covered by the WTO GPA, a Free Trade Agreement, or the Israeli Trade Act, eligible products receive equal consideration with domestic offers. FAR 25.402 also makes acquisition value a trigger for coverage, and the U.S. Trade Representative revises most thresholds about every two years. For service acquisitions covered by trade agreements, the contracting officer determines origin by the country where the firm providing the services is established. The Trade Agreements clause at 52.225-5 then supplies the operative definitions, including designated country and designated country end product, for supply contracts covered by the rule.
The threshold table in FAR 25.402 is tied to trade-agreement coverage and most thresholds are subject to U.S. Trade Representative revision about every two years, so an outdated threshold check can lead to the wrong compliance path.
Confirm whether the acquisition falls under WTO GPA, a Free Trade Agreement, or the Israeli Trade Act.
Compare the procurement value to the applicable trade-agreement threshold table in FAR 25.402.
For services, use the country where the firm providing the services is established.
For supply contracts covered by trade agreements, use FAR 52.225-5 definitions for designated-country end products.