25.003 Definitions.

As used in this part—

Caribbean Basin country means any of the following countries: Antigua and Barbuda, Aruba,

Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana,

Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint

Eustatius, Sint Maarten, or Trinidad and Tobago.

Caribbean Basin country end product—

(1) Means an article that–

(i)

(A) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or

(B) In the case of an article that consists in whole or in part of materials from another country, has

been substantially transformed in a Caribbean Basin country into a new and different article of

commerce with a name, character, or use distinct from that of the article or articles from which it

was transformed; and

(ii) Is not excluded from duty-free treatment for Caribbean countries under 19 U.S.C. 2703(b).

(A) For this reason, the following articles are not Caribbean Basin country end products:

(1) Tuna, prepared or preserved in any manner in airtight containers.

(2) Petroleum, or any product derived from petroleum.

(3) Watches and watch parts (including cases, bracelets, and straps) of whatever type including, but

not limited to, mechanical, quartz digital, or quartz analog, if such watches or watch parts contain

any material that is the product of any country to which the Harmonized Tariff Schedule of the

United States (HTSUS) column 2 rates of duty apply (i.e., Afghanistan, Cuba, Laos, North Korea, and

Vietnam).

(4) Certain of the following: textiles and apparel articles; footwear, handbags, luggage, flat goods,

work gloves, and leather wearing apparel; or handloomed, handmade, and folklore articles.

(B) Access to the HTSUS to determine duty-free status of articles of the types listed in paragraph

(1)(ii)(A)(4) of this definition is available via the Internet at https://usitc.gov/tata/hts/index.htm. In

particular, see the following:

(1) General Note 3(c), Products Eligible for Special Tariff treatment.

(2) General Note 17, Products of Countries Designated as Beneficiary Countries under the United

States- Caribbean Basin Trade Partnership Act of 2000.

(3) Section XXII, Chapter 98, Subchapter II, Articles Exported and Returned, Advanced or Improved

Abroad, U.S. Note 7(b).
(4) Section XXII, Chapter 98, Subchapter XX, Goods Eligible for Special Tariff Benefits under the

United States-Caribbean Basin Trade Partnership Act; and

(2) Refers to a product offered for purchase under a supply contract, but for purposes of calculating

the value of the acquisition, includes services (except transportation services) incidental to the

article, provided that the value of those incidental services does not exceed that of the article itself.

Civil aircraft and related articles means-

(1) All aircraft other than aircraft to be purchased for use by the Department of Defense or the U.S.

Coast Guard;

(2) The engines (and parts and components for incorporation into the engines) of these aircraft;

(3) Any other parts, components, and subassemblies for incorporation into the aircraft; and

(4) Any ground flight simulators, and parts and components of these simulators, for use with respect

to the aircraft, whether to be used as original or replacement equipment in the manufacture, repair,

maintenance, rebuilding, modification, or conversion of the aircraft and without regard to whether

the aircraft or articles receive duty-free treatment under section 601(a)(2) of the Trade Agreements

Act.

Component means an article, material, or supply incorporated directly into an end product or

construction material.

Construction material means an article, material, or supply brought to the construction site by a

contractor or subcontractor for incorporation into the building or work. The term also includes an

item brought to the site preassembled from articles, materials, or supplies. However, emergency life

safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are

discrete systems incorporated into a public building or work and that are produced as complete

systems, are evaluated as a single and distinct construction material regardless of when or how the

individual parts or components of those systems are delivered to the construction site. Materials

purchased directly by the Government are supplies, not construction material.

Cost of components means-

(1) For components purchased by the contractor, the acquisition cost, including transportation costs

to the place of incorporation into the end product or construction material (whether or not such

costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry

certificate is issued); or

(2) For components manufactured by the contractor, all costs associated with the manufacture of the

component, including transportation costs as described in paragraph (1) of this definition, plus

allocable overhead costs, but excluding profit. Cost of components does not include any costs

associated with the manufacture of the end product.

Critical component means a component that is mined, produced, or manufactured in the United

States and deemed critical to the U.S. supply chain. The list of critical components is at 25.105.

Critical item means a domestic construction material or domestic end product that is deemed critical

to the U.S. supply chain. The list of critical items is at 25.105.
Designated country means any of the following countries:

(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia,

Aruba, Australia, Austria,, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark,

Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy,

Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova,

Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania,

Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World

Trade Organization as "the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu

(Chinese Taipei)"), Ukraine, or United Kingdom);

(2) A Free Trade Agreement (FTA) country (Australia, Bahrain, Chile, Colombia, Costa Rica,

Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco,

Nicaragua, Oman, Panama, Peru, or Singapore);

(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso,

Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo,

Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos,

Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda,

Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan,

Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or

(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire,

British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St.

Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad

and Tobago).

Designated country end product means a WTO GPA country end product, an FTA country end

product, a least developed country end product, or a Caribbean Basin country end product.

Domestic construction material means-

(1) For use in subparts other than 25.6—

(i) For construction material that does not consist wholly or predominantly of iron or steel or a

combination of both—

(A) An unmanufactured construction material mined or produced in the United States; or

(B) A construction material manufactured in the United States, if–

(1) The cost of the components mined, produced, or manufactured in the United States exceeds 60

percent of the cost of all its components, except that the percentage will be 65 percent for items

delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in

calendar year 2029 (unless an alternate percentage is established for a contract in accordance with

FAR 25.201(c)).Components of unknown origin are treated as foreign; or

(2) The construction material is a commercially available off-the-shelf (COTS) item; or

(ii) For construction material that consists wholly or predominantly of iron or steel or a combination

of both, a construction material manufactured in the United States if the cost of foreign iron and

steel constitutes less than 5 percent of the cost of all the components used in such construction

material. The cost of foreign iron and steel includes but is not limited to the cost of foreign iron or
steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the

manufacture of the construction material and a good faith estimate of the cost of all foreign iron or

steel components excluding COTS fasteners. Iron or steel components of unknown origin are treated

as foreign. If the construction material contains multiple components, the cost of all the materials

used in such construction material is calculated in accordance with the definition of “cost of

components” in this section; or

(3) For use in subpart 25.6, see the definition in 25.601.

Domestic end product means-

(1) For an end product that does not consist wholly or predominantly of iron or steel or a

combination of both—

(i) An unmanufactured end product mined or produced in the United States;

(ii) An end product manufactured in the United States, if–

(A) The cost of its components mined, produced, or manufactured in the United States exceeds 60

percent of the cost of all its components, except that the percentage will be 65 percent for items

delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in

calendar year 2029 (unless an alternate percentage is established for a contract in accordance with

FAR 25.101(d)). Components of unknown origin are treated as foreign. Scrap generated, collected,

and prepared for processing in the United States is considered domestic; or

(B) The end product is a COTS item; or

(2) For an end product that consists wholly or predominantly of iron or steel or a combination of

both, an end product manufactured in the United States, if the cost of foreign iron and steel

constitutes less than 5 percent of the cost of all the components used in the end product. The cost of

foreign iron and steel includes but is not limited to the cost of foreign iron or steel mill products

(such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of

the end product and a good faith estimate of the cost of all foreign iron or steel components

excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the

end product contains multiple components, the cost of all the materials used in such end product is

calculated in accordance with the definition of "cost of components" in this section.

Domestic offer means an offer of a domestic end product. When the solicitation specifies that award

will be made on a group of line items, a domestic offer means an offer where the proposed price of

the domestic end products exceeds 50 percent of the total proposed price of the group.

Eligible offer means an offer of an eligible product. When the solicitation specifies that award will be

made on a group of line items, an eligible offer means a foreign offer where the combined proposed

price of the eligible products and the domestic end products exceeds 50 percent of the total

proposed price of the group.

Eligible product means a foreign end product, construction material, or service that, due to

applicability of a trade agreement to a particular acquisition, is not subject to discriminatory

treatment.

End product means those articles, materials, and supplies to be acquired for public use.

Fastener means a hardware device that mechanically joins or affixes two or more objects together.
Examples of fasteners are nuts, bolts, pins, rivets, nails, clips, and screws.

Foreign construction material means a construction material other than a domestic construction

material.

Foreign contractor means a contractor or subcontractor organized or existing under the laws of a

country other than the United States.

Foreign end product means an end product other than a domestic end product.

Foreign iron and steel means iron or steel products not produced in the United States. Produced in

the United States means that all manufacturing processes of the iron or steel must take place in the

United States, from the initial melting stage through the application of coatings, except

metallurgical processes involving refinement of steel additives. The origin of the elements of the iron

or steel is not relevant to the determination of whether it is domestic or foreign.

Foreign offer means any offer other than a domestic offer.

Free Trade Agreement country means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican

Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua,

Oman, Panama, Peru, or Singapore.

Free Trade Agreement country end product means an article that-

(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement (FTA) country; or

(2) In the case of an article that consists in whole or in part of materials from another country, has

been substantially transformed in an FTA country into a new and different article of commerce with

a name, character, or use distinct from that of the article or articles from which it was transformed.

The term refers to a product offered for purchase under a supply contract, but for purposes of

calculating the value of the end product, includes services (except transportation services) incidental

to the article, provided that the value of those incidental services does not exceed that of the article

itself.

Israeli end product means an article that-

(1) Is wholly the growth, product, or manufacture of Israel; or

(2) In the case of an article that consists in whole or in part of materials from another country, has

been substantially transformed in Israel into a new and different article of commerce with a name,

character, or use distinct from that of the article or articles from which it was transformed.

Least developed country means any of the following countries: Afghanistan, Angola, Bangladesh,

Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros,

Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea,

Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania,

Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone,

Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu,

Yemen, or Zambia.

Least developed country end product means an article that-

(1) Is wholly the growth, product, or manufacture of a least developed country; or
(2) In the case of an article that consists in whole or in part of materials from another country, has

been substantially transformed in a least developed country into a new and different article of

commerce with a name, character, or use distinct from that of the article or articles from which it

was transformed. The term refers to a product offered for purchase under a supply contract, but for

purposes of calculating the value of the end product, includes services (except transportation

services) incidental to the article, provided that the value of those incidental services does not

exceed that of the article itself.

Noneligible offer means an offer of a noneligible product.

Noneligible product means a foreign end product that is not an eligible product.

Predominantly of iron or steel or a combination of both means that the cost of the iron and steel

content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the

cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or

forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or

steel components excluding COTS fasteners.

Steel means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and

may include other elements.

United States means the 50 States, the District of Columbia, and outlying areas.

U.S.-made end product means an article that is mined, produced, or manufactured in the United

States or that is substantially transformed in the United States into a new and different article of

commerce with a name, character, or use distinct from that of the article or articles from which it

was transformed.

World Trade Organization Government Procurement Agreement (WTO GPA) country means any of

the following countries: Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia,

Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong,

Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania,

Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway,

Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan,

Ukraine, or United Kingdom.

WTO GPA country end product means an article that-

(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or

(2) In the case of an article that consists in whole or in part of materials from another country, has

been substantially transformed in a WTO GPA country into a new and different article of commerce

with a name, character, or use distinct from that of the article or articles from which it was

transformed. The term refers to a product offered for purchase under a supply contract, but for

purposes of calculating the value of the end product includes services (except transportation

services) incidental to the article, provided that the value of those incidental services does not

exceed that of the article itself.

Parent topic: Part 25 - Foreign Acquisition