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[Federal Register: February 18, 1997 (Volume 62, Number 32)]
[Notices]               
[Page 7205-7206]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18fe97-32]

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DEPARTMENT OF AGRICULTURE
Rural Utilities Service
Rural Telephone Bank

 
Amendment to the Rural Electrification Act's ``Buy American'' 
Provision

AGENCY: Rural Utilities Service and Rural Telephone Bank, USDA.

ACTION: Notice of Amendment to the Rural Electrification Act's ``Buy 
American'' Provision.

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SUMMARY: The Uruguay Round Agreements Act, (108 Stat. 4954, Public Law 
103-465, December 8, 1994), amends the ``Buy American'' provision, (7 
U.S.C. 903 note) of the Rural Electrification Act of 1936, as amended 
(7 U.S.C. 901 et seq.) (the ``RE Act'). In the provision, as amended by 
the Uruguay Round Agreements Act, the

[[Page 7206]]

words ``Mexico, or Canada'' are replaced with ``or in any eligible 
country''. The United States Trade Representative (USTR) determines 
what countries are ``eligible''. As amended, the provision directs the 
Secretary of Agriculture, for the Rural Utilities Service (RUS), 
(previously the Rural Electrification Administration) to require that, 
to the extent practicable and the cost not unreasonable, a borrower use 
funds lent under the RE Act only for such unmanufactured articles, 
materials, and supplies, as have been mined or produced in the United 
States or eligible country and only such manufactured articles, 
materials, and supplies as have been manufactured in the United States 
or an eligible country substantially all from articles, materials or 
supplies mined, produced, or manufactured, as the case may be, in the 
United States or an eligible country.
    This action is intended to provide borrowers receiving loans made 
by the Rural Telephone Bank (RTB) or loans made or guaranteed by RUS, 
as well as material and equipment manufacturers and the public, with 
information for compliance with the amended RE Act ``Buy American'' 
provision.

FOR FURTHER INFORMATION CONTACT: For electric program matters: George 
Bagnall, Director, Electric Staff Division, RUS, U.S. Department of 
Agriculture, STOP 1569, 1400 Independence Ave., SW., Washington, DC 
20250-1569. Telephone number (202) 720-1900, fax (202) 720-7491.
    For telecommunications program matters: Orren E. Cameron, III, 
Director, Telecommunications Standards Division, RUS, U.S. Department 
of Agriculture, STOP 1598, 1400 Independence Ave., SW., Washington, DC 
20250-1598. Telephone number (202) 720-8663, fax (202) 720-4099.

SUPPLEMENTARY INFORMATION: Section 342(g) of the Uruguay Round 
Agreements Act, amended the RE Act ``Buy American'' provision by 
replacing the words ``Mexico, or Canada'' with ``or in any eligible 
country'' and by authorizing the United States Trade Representative 
(USTR) to determine what countries are eligible. The ``Buy American'' 
provision now reads:
    ``In making loans pursuant to * * * the Rural Electrification Act 
of 1936 * * * the Secretary of Agriculture shall require that, to the 
extent practicable and the cost of which is not unreasonable, the 
borrower agree to use in connection with the expenditure of such funds 
only such unmanufactured articles, materials and supplies, as have been 
mined or produced in the United States or in any eligible country, and 
only such manufactured articles, materials, and supplies as have been 
manufactured in the United States or in any eligible country, 
substantially all from articles, materials, or supplies mined, 
produced, or manufactured, as the case may be, in the United States or 
in any eligible country. For purposes of this section, an `eligible 
country' is any country that applies with respect to the United States 
an agreement ensuring reciprocal access for United States products and 
services and United States suppliers to the markets of that country, as 
determined by the United States Trade Representative.''
    The RUS ``Buy American'' provision applies to any loan made by the 
RTB or made or guaranteed by the RUS. Whether a particular product is 
domestic or non-domestic for purposes of the RE Act ``Buy American'' 
provision depends upon such factors as the country of origin of the 
product and its component parts and whether the product is purchased by 
an electric borrower or a telecommunications borrower.
    The eligibility status of Canada and Mexico has not changed. 
Products produced in Canada or Mexico substantially consisting of 
components produced in Canada, Mexico, or the United States and 
purchased with RTB or RUS electric or telephone loan funds are treated 
as United States domestic products.
    At this time the USTR has determined that only Canada and Mexico 
are eligible countries for purchases made by telecommunications 
borrowers. Therefore, products produced in countries other than the 
United States, Canada, or Mexico and purchased by RUS 
telecommunications borrowers are not treated as domestic products for 
purposes of the RE Act ``Buy American'' provision. The amendment makes 
no change in the treatment of these purchases unless and until the USTR 
determines additional ``eligible countries'' for telecommunications 
borrowers.
    At this time, the USTR has determined that the following countries 
have agreements ensuring reciprocal access regarding products used by 
electric borrowers, and are therefore ``eligible countries'' for 
purchases made by electric borrowers:

Austria
Belgium
Denmark
Finland
France
Germany
Greece
Ireland
Israel
Italy
Japan
Korea
Luxembourg
The Netherlands
Norway
Portugal
Singapore
Spain
Sweden
Switzerland
United Kingdom

    Products from an eligible country consisting substantially of 
components produced in the United States or any eligible country and 
purchased by RUS electric borrowers with RUS loan funds will be 
considered to be domestic products for purposes of the RE Act ``Buy 
American'' provision.
    The USTR may at any time declare one or more additional countries 
to be ``eligible countries'' for either electric or telecommunications 
borrowers. The Chair of Technical Standards Committee ``A'' (Electric) 
will be the point of contact for RUS with respect to USTR 
determinations of eligible countries. Each RUS borrower is responsible 
for assuring that its procurement complies with the requirements of the 
RE Act ``Buy American'' provision.
    RUS is making technical revisions to its existing forms of loan 
contracts and loan contract amendments to conform them to the RE Act 
``Buy American'' provision as amended. In addition, RUS will make 
similar technical revisions to its standard forms of contracts 
providing for the purchase of materials and equipment and for ``furnish 
and install'' type construction. Until these forms are revised, the 
borrower should make the appropriate changes in its contract forms.

    Dated: February 5, 1997.
Wally Beyer,
Administrator, Rural Utilities Service, and Governor, Rural Telephone 
Bank.
[FR Doc. 97-3794 Filed 2-14-97; 8:45 am]
BILLING CODE 3410-15-P
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