11950 Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Rules and Regulations 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Parts 213, 225, and 252 

[Docket DARS–2023–0024] 

RIN 0750–AL74 

Defense Federal Acquisition 

Regulation Supplement: DFARS Buy 

American Act Requirements (DFARS 

Case 2022–D019) 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Final rule. 

SUMMARY: DoD is issuing a final rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to implement an Executive 

order addressing domestic preferences 

in DoD procurement. 

DATES: Effective February 15, 2024. 

FOR FURTHER INFORMATION CONTACT: 

Kimberly Bass, telephone 703–717– 

3446. 

SUPPLEMENTARY INFORMATION: 

I. Background 

DoD published a proposed rule in the 

Federal Register at 88 FR 37942 on June 

9, 2023, to amend the DFARS to 

supplement the Federal Acquisition 

Regulation (FAR) implementation of 

Executive Order (E.O.) 14005, Ensuring 

the Future Is Made in All of America by 

All of America’s Workers (86 FR 7475, 

January 28, 2021). E.O. 14005 

contemplates a series of actions to 

enable the United States Government to 

maximize the use of goods, products, 

and materials produced in the United 

States in order to strengthen and 

diversify domestic supplier bases and 

create new opportunities for U.S. firms 

and workers. The rule addresses section 

8 of the E.O., which requires increasing 

the impact of the Buy American statute. 

The revisions to the DFARS in this 

final rule supplement the FAR final rule 

published in the Federal Register at 87 

FR 12780 on March 7, 2022, with the 

required conforming changes for the 

DoD-unique requirements. Four 

respondents submitted public 

comments in response to the proposed 

rule. 

II. Discussion and Analysis 

DoD reviewed the public comments in 

the development of the final rule. A 

discussion of the comments is provided. 

There were no changes made to the 

proposed rule as a result of those 

comments. 

A. Summary of Significant Changes 

From the Proposed Rule 

The prescriptions for use of the 

solicitation provisions at DFARS 

252.225–7000, Buy America—Balance 

of Payments Program Certificate, and 

DFARS 252.225–7035, Buy American— 

Free Trade Agreements—Balance of 

Payments Program Certificate, were 

revised to clarity the use of the 

solicitation provisions when the 

solicitation includes the provision at 

FAR 52.204–7, System for Award 

Management. The statement in the 

prescriptions at DFARS 225.1101(1) and 

225.1101(9), ‘‘If the solicitation includes 

the provision at FAR 52.204–7, do not 

separately list the provision 252.225– 

7000 in the solicitation’’, was removed. 

The revision allows for the required 

identification by the offeror of supplies 

that do not meet the definition of a 

domestic end product and an increased 

domestic content threshold, by 

separately listing qualifying country and 

other foreign end products in its offer. 

The offeror’s certification provides the 

country of origin for those foreign end 

products that do exceed 55 percent 

domestic content, except for those that 

are commercially available off-the-shelf 

(COTS) items. Moreover, the provisions 

at DFARS 252.225–7000 and 252.225– 

7035 include the DoD-unique 

requirements associated with the 

framework in the DFARS as 

implemented in the FAR for the future 

application of the enhanced price 

preference for a domestic product that is 

considered a critical item. 

B. Analysis of Public Comments 

1. Support for the Rule 

Comment: Some respondents were 

supportive of the overall goal of the rule 

in general to strengthen the domestic 

industrial base and promote American 

manufacturing and innovation. 

Response: DoD acknowledges the 

respondents’ support for the rule. 

2. Definitions 

Comment: A few respondents 

requested that a definition of domestic 

content be provided. A respondent 

requested clarity on how the definition 

of domestic content differs from 

domestic end product, domestic 

component, or domestic source. 

Response: The rule revises the 

definitions of domestic end product, 

domestic construction material, and 

qualifying country end product, and 

makes conforming revisions in the 

applicable DFARS solicitation 

provisions and contract clauses 

including alternates to implement the 

newly established schedule for domestic 

content threshold that a product must 

meet to be defined as ‘‘domestic’’. The 

current definition of domestic end 

product is at DFARS 225.003. 

‘‘Domestic component’’ and ‘‘domestic 

source’’ are not defined in this rule. 

However, DFARS 225.003 states, 

‘‘Source, when restricted by words such 

as foreign, domestic, or qualifying 

country, means the actual manufacturer 

or producer of the end product or 

component.’’ Moreover, the Buy 

American statute, for purchases above 

the micro-purchase threshold, still 

requires that only domestic end 

products be acquired subject to the 

listed exceptions in accordance with the 

requirements at DFARS 225.101 to 

determine whether a manufactured end 

product is a domestic end product. 

3. Framework for Enhanced Price 

Preference 

Comment: A respondent conveyed 

thoughts regarding the need to ensure 

compliance with the domestic content 

framework to reduce DoD supply 

vulnerabilities and ensure contractor 

compliance with the domestic content 

requirements for critical items, 

components, and the price preferences. 

Another respondent further expressed 

the need for guidance on how domestic 

content of critical components will be 

accounted for and evaluated in source 

selection. A respondent also requested a 

clear definition of critical component, 

with explanation of how it differs from 

other similar terms. A respondent also 

requested that a definition of critical 

component in coordination with 

industry partners be provided. 

Response: The rule includes the 

future application of an enhanced price 

preference for a domestic product that is 

considered a critical item or is made up 

of critical components. The revisions to 

the DFARS in this rule only supplement 

the FAR by making the necessary 

conforming changes to specifically 

incorporate the DoD-unique 

requirements. 

The proposed policy guidance on how 

the domestic content of critical items 

will be accounted for and evaluated will 

be provided in a subsequent rulemaking 

under FAR Case 2022–004, Enhanced 

Price Preference for Critical Items. The 

definition of critical component is 

provided at FAR 25.003, which was 

established as part of the framework for 

the enhanced price preference to be 

implemented in the subsequent FAR 

rule for critical items. 

4. Buy American Act Exceptions and 

Waivers 

Comment: A respondent relayed 

concerns with the use of a public 


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interest exception and continued use of 

Reciprocal Defense Procurement (RDP) 

Agreements with qualifying countries 

for the Buy American Act requirements 

implemented in the rule. A respondent 

commented that the rule creates more 

bureaucracy for senior Government 

officials, and that bureaucracy should 

not extend to decisions about individual 

contract terms and conditions. A 

respondent stated the rule should 

balance benefits of domestic sourcing 

with potential risks and provide 

reasonable exemptions or waivers for 

when domestic sourcing is not feasible. 

A respondent recommended the rule 

should address potential impacts on 

increased domestic content on 

availability, quality, and affordability of 

end products and components essential 

for national security or public interest. 

Additionally, a respondent stated that 

consideration should be given to 

tradeoffs between domestic sourcing 

and other factors. The respondent 

further recommended clear, consistent 

procedures for granting waivers and 

exceptions to the Buy American Act, 

and to define roles and responsibilities 

of stakeholders involved in the waiver 

process to streamline and standardize 

the process. 

Response: The public interest 

exception to the Buy American statute 

and the use of RDP Agreements with 

qualifying countries in DoD are essential 

to ensure mutual military readiness, 

standardization, and interoperability of 

equipment between the armed forces of 

the associated allied nations and for 

national security interests. 

DFARS 225.101(d)(1) provides for a 

senior procurement executive to allow 

the application of an alternate domestic 

content test in defining ‘‘domestic end 

product’’ after consultation with the 

Office of Management and Budget’s 

Made in America Office, a process 

internal to the Government. The 

alternate domestic content test will 

allow the contractor to comply with the 

domestic content threshold that applies 

at the time of contract award, for the 

entire period of performance for that 

contract. 

Additionally, the nonavailability 

waiver determination requirements of 

the OMB memorandum titled 

‘‘Improving the Transparency of Made 

in America Waivers,’’ dated October 26, 

2021, and the associated OMB 

Memorandum M–21–26, Increasing 

Opportunities for Domestic Sourcing 

and Reducing the Need for Waivers 

from Made in America Laws, dated June 

11, 2021, provide for more transparency 

in the Federal marketplace to support 

domestic sourcing and increase public 

trust in the Federal Government’s 

commitment to an expanded U.S. 

domestic supplier base. Moreover, OMB 

Memorandum M–21–26 outlines the 

initial process management steps to 

help Federal agencies prepare for and 

support a centralized strategic 

nonavailability waiver determination 

review process as required by E.O. 

14005. 

5. Alternate Domestic Content Test 

Comment: A few respondents stated 

concerns with the domestic content 

threshold requirements to be 

determined in the year of delivery. A 

respondent recommended the rule 

should be clear and concise, and the 

content requirements should be set at 

the time of contract award for the life of 

the contract. A respondent 

recommended a reasonable time for 

transition to comply with the new 

content requirements and provide 

technical support. A respondent also 

stated that changing content thresholds 

over time will be a complicating factor 

for multi-year indefinite-delivery, 

indefinite-quantity contracts, and the 

year of delivery requirements for 

domestic content creates uncertainty. 

Response: The rule allows for 

industry transition and the use of the 55 

percent domestic content threshold (i.e., 

the fallback threshold as included in the 

FAR final rule), until one year after the 

increase of the domestic content 

threshold to 75 percent. This rule 

supplements the FAR with a consistent 

55 percent fallback threshold available 

until January 1, 2030, for use if domestic 

products at a higher threshold are not 

available, or the cost to acquire them 

would be unreasonable. 

This rule revises the definition of 

‘‘domestic end product’’ to authorize the 

use of the fallback threshold if the 

award is made before January 1, 2030, 

for a foreign end product that exceeds 

55 percent domestic content (see 

DFARS 225.103(b)(ii)). Therefore, a 

nonavailability determination is not 

required before January 1, 2030, if there 

is an offer for a foreign end product that 

exceeds 55 percent domestic content, 

including qualifying country content 

(see DFARS 225.103(b)(ii) and 

225.202(a)(2)). 

There are some instances where it is 

not feasible for some indefinite-delivery, 

indefinite-quantity contracts that are 

subject to the Buy American statute to 

meet changing domestic content 

thresholds throughout the period of 

performance. The rule at DFARS 

225.101(d)(1) includes a process 

whereby an agency senior procurement 

executive may allow for application of 

an alternate domestic content test to the 

definition of ‘‘domestic construction 

material’’ and ‘‘domestic end product’’ 

and require the contractor to comply 

only with the domestic content 

threshold that is in effect at contract 

award for the entire contract term. 

6. Supply Chain Impacts 

Comment: A respondent stated the 

rule will create supply chain challenges 

and recommended a more efficient rule. 

A respondent also stated that solutions 

were set with supply chains identified 

on award and the rule creates 

uncertainties in supply and can impact 

DoD readiness. 

Response: The rule supplements the 

FAR final rule, which implements 

section 8 of E.O. 14005, aimed to 

strengthen the impact of Federal 

procurement preferences in the Buy 

American statute for end products and 

construction materials that are 

domestically manufactured from 

substantially all domestic content. The 

changes to the implementation of the 

Buy American statute were designed to 

support greater domestic production of 

products critical to our national and 

economic security. The rule provides a 

schedule for future increases to 

domestic content requirements, and a 

fallback threshold that would allow for 

products meeting a specific lower 

domestic content threshold to qualify as 

domestic products under certain 

circumstances. The rule supplements 

the FAR with a consistent 55 percent 

fallback threshold available until 

January 1, 2030, for use where domestic 

end products at a higher threshold are 

not available or the cost to acquire them 

would be unreasonable. 

7. Determining Reasonableness of Cost 

Comment: A respondent 

recommended the rule provide more 

clarity and guidance on how to 

determine domestic content of end 

products and components, especially 

items with multiple sources or origins. 

The respondent also recommended the 

rule should provide how to calculate the 

cost of components, and provide what 

evidence is required to support the 

claims to reduce errors and costs. The 

respondent further stated that a 

significant factor in implementation of 

the rule should be transactional 

simplicity to reduce burden on all 

parties. 

Response: There were no changes 

made to the process for determining cost 

reasonableness in the rule. Also see the 

response in this section at comment 

category number 2. Definitions. 

8. Outside the Scope of the Rule 

Comment: A respondent specified the 

need for the prompt publication of FAR 


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Case 2022–004, Enhanced Price 

Preference for Critical Components and 

Critical Items, on about August 23, 

2023. 

Response: FAR case 2022–004, 

Enhanced Price Preference for Critical 

Items, is intended to establish the 

definitive list of critical items and 

critical components in the FAR, along 

with their associated enhanced price 

preference(s). The publication date for 

the FAR rule referenced is out of the 

scope of the implementation of this 

DFARS rule. However, information on 

FAR case 2022–004, Enhanced Price 

Preference for Critical Items, is provided 

at https://www.reginfo.gov/public/do/ 

eAgendaMain. For information on FAR 

rules, select ‘‘DoD/GSA/NASA (FAR)’’ 

from the ‘‘Select Agency’’ drop-down 

menu. 

C. Other Changes 

At DFARS 213.302–5(d)(i) and (ii) the 

titles of the clauses at DFARS 252.225– 

7001 and 252.225–7036 are corrected to 

remove the word ‘‘Act’’. Conforming 

revisions required to the definition of 

qualifying country end product are 

made to the Basic and Alternates of the 

clause at DFARS 252.225–7021, Trade 

Agreements. 

III. Applicability to Contracts at or 

Below the Simplified Acquisition 

Threshold (SAT) and for Commercial 

Services and Commercial Products, 

Including Commercially Available Offthe-Shelf (COTS) Items 

This final rule includes amendments 

to the following solicitation provisions 

and contract clauses: DFARS 252.225– 

7000, Buy American and Balance of 

Payments Program Certificate (Basic and 

Alternate I); DFARS 252.225–7001, Buy 

American and Balance of Payments 

Program (Basic and Alternate I); DFARS 

252.225–7021 Trade Agreements (Basic 

and Alternates II, III, and IV); DFARS 

252.225–7035, Buy American—Free 

Trade Agreements—Balance of 

Payments Program Certificate (Basic and 

Alternates I, II, III, IV, and V); DFARS 

252.225–7036, Buy American—Free 

Trade Agreements—Balance of 

Payments Program (Basic and Alternates 

I, II, III, IV, and V); DFARS 252.225– 

7044, Balance of Payments Program— 

Construction Material, (Basic and 

Alternate I); and 252.225–7045, Balance 

of Payments Program—Construction 

Material Under Trade Agreements 

(Basic and Alternates I, II, and III). In 

addition, the rule includes new 

alternates for the clauses at DFARS 

252.225–7001, 252.225–7036, 252.225– 

7044, and 252.225–7045. The rule does 

not add any new requirements on 

contracts at or below the simplified 

acquisition threshold, for commercial 

products including commercially 

available off the-shelf items, or for 

commercial services. 

IV. Expected Impact of the Rule 

This final rule revises the DFARS to 

supplement the FAR’s implementation 

of the Buy American statute in 

accordance with E.O. 14005, via the 

final FAR rule (FAR Case 2021–008, 

published March 7, 2022, in the Federal 

Register at 87 FR 12780, with an 

effective date of October 25, 2022). The 

FAR final rule provided for the 

following: 

1. An increase to the domestic content 

threshold that a product must meet to be 

defined as ‘‘domestic’’; a schedule for 

future increases; and a fallback 

threshold that would allow products 

meeting a specific lower domestic 

content threshold to qualify as a 

domestic product under certain 

circumstances; and 

2. A framework for the application of 

an enhanced price preference for a 

domestic product that is considered a 

critical product or is made up of critical 

components. 

This final rule implements these 

changes in DFARS part 225 and in the 

solicitation provisions and contract 

clauses that contain DoD-unique 

requirements such as the inclusion of 

qualifying countries. A qualifying 

country is a country that has a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or 

services performed by sources of the 

other country. The memorandum of 

understanding or agreement complies, 

where applicable, with the requirements 

of section 36 of the Arms Export Control 

Act (22 U.S.C. 2776) and with 10 U.S.C. 

2457. The DFARS definition of 

‘‘domestic end product’’, for the 

purpose of compliance with the 

domestic content threshold, includes 

components that are mined, produced, 

or manufactured in the United States 

and in qualifying countries. The list of 

qualifying countries appears in the 

definition of ‘‘qualifying country’’ at 

DFARS 225.003 and in certain contract 

clauses. 

It is anticipated that those domestic 

industries adjusting for the increased 

domestic content within their supply 

chains to continue supplying domestic 

end products are more likely to benefit 

from a competitive advantage when the 

rule takes effect. Because the FAR final 

rule has been in effect since October 

2022, potential offerors may already be 

making those adjustments. 

The Buy American statute and the 

Balance of Payments Program (e.g., 

certifications required of offerors to 

demonstrate end products are domestic) 

remain unchanged and continue to 

reflect processes that have been in place 

for decades. Under this final rule, as 

under the FAR final rule, when deciding 

whether to pursue a procurement and 

use of products (i.e., domestic or 

foreign), offerors will have to plan for 

the future changes to the domestic 

content threshold during the period of 

performance of an anticipated contract, 

unless use of an alternate domestic 

content threshold, in effect at time of 

contract award, has been authorized. 

As under the FAR final rule, those 

offerors that do not modify their supply 

chains to comply with the scheduled 

increases to the domestic content 

threshold will still be able to propose an 

offer for DoD contracts. However, the 

price preference may no longer be 

available to them. 

Increased domestic sourcing of 

content facilitates the reduction of 

DoD’s supply chain risk. Because the 

FAR final rule has been in effect since 

October 2022, any increased burden 

with regard to the timed increases to the 

domestic content threshold, on 

contractors in particular, could be minor 

if not de minimis. 

The framework for the enhanced price 

preference is intended to provide a 

stable source of demand for 

domestically produced critical products. 

This final rule merely supplements the 

FAR with the DoD-unique requirements. 

A separate rulemaking will be 

undertaken to add to the FAR critical 

products and components to establish 

the associated preferences. Therefore, 

the associated cost impacts and benefits 

will be captured in the subsequent FAR 

rulemaking (FAR case 2022–004, 

Enhanced Price Preference for Critical 

Items). 

There is an information collection 

burden associated with offerors 

identifying when a domestic end 

product or domestic construction 

material contains a critical component 

or critical item (see section VIII of this 

preamble), but it is anticipated that the 

information collection will be fully 

implemented for all agencies that use 

the FAR in the future rulemaking for 

FAR Case 2022–004. Any of the 

associated burden should be offset by 

the benefits of the larger price 

preference received for these items. The 

overall cost impact of this rule is not 

significant, and any associated impact is 

anticipated to be primarily positive. 


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V. Executive Orders 12866 and 13563 

Executive Orders (E.O.s) 12866 and 

13563 direct agencies to assess all costs 

and benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). E.O. 13563 emphasizes the 

importance of quantifying both costs 

and benefits, of reducing costs, of 

harmonizing rules, and of promoting 

flexibility. This is not a significant 

regulatory action and, therefore, was not 

subject to review under section 6(b) of 

E.O. 12866, Regulatory Planning and 

Review, as amended. 

VI. Congressional Review Act 

As required by the Congressional 

Review Act (5 U.S.C. 801–808) before an 

interim or final rule takes effect, DoD 

will submit a copy of the interim or 

final rule with the form, Submission of 

Federal Rules under the Congressional 

Review Act, to the U.S. Senate, the U.S. 

House of Representatives, and the 

Comptroller General of the United 

States. A major rule under the 

Congressional Review Act cannot take 

effect until 60 days after it is published 

in the Federal Register. The Office of 

Information and Regulatory Affairs has 

determined that this rule is not a major 

rule as defined by 5 U.S.C. 804. 

VII. Regulatory Flexibility Act 

A final regulatory flexibility analysis 

has been prepared consistent with the 

Regulatory Flexibility Act, 5 U.S.C. 601, 

et seq. and is summarized as follows: 

This rule includes amendments to the 

Defense Federal Acquisition Regulation 

Supplement (DFARS) to supplement the 

Federal Acquisition Regulation (FAR) 

implementation of Executive Order 

(E.O.) 14005, Ensuring the Future Is 

Made in All of America by All of 

America’s Workers (86 FR 7475, January 

28, 2021), by addressing DoD-unique 

requirements. The FAR final rule, 

published at 87 FR 12780 on March 7, 

2022 (effective October 25, 2022), 

implemented section 8 of E.O. 14005, 

which requires the impact of the Buy 

American statute to be strengthened by 

providing— 

• An increase to the domestic content 

threshold required to be met for an end 

product and construction material to be 

defined as ‘‘domestic’’ and a schedule 

for future increases; 

• A fallback threshold that allows for 

end products meeting a specific lower 

domestic content threshold to qualify as 

a domestic end product under certain 

circumstances; and 

• A framework for application of an 

enhanced price preference for a 

domestic end product that is considered 

a critical item or is made up of critical 

components. 

The objective of the rule is to make 

conforming changes associated with the 

FAR implementation of E.O. 14005 that 

incorporate the DoD-unique 

requirements (e.g., inclusion of 

qualifying countries). E.O. 14005 

addresses a series of actions to enable 

the U.S. Government to maximize the 

use of goods, products, and materials 

produced in the United States in order 

to strengthen and diversify domestic 

supplier bases and create new 

opportunities for U.S. firms and 

workers. 

No public comments were received in 

response to the initial regulatory 

flexibility analysis. 

Data was obtained from the Federal 

Procurement Data System for fiscal 

years 2019, 2020, and 2021 on awards 

valued over the micro-purchase 

threshold for construction and for 

supplies. Based on the data, DoD made 

an average of 161,686 awards for 

supplies per year to approximately 

14,913 small entities and an average of 

177 awards for construction per year to 

approximately 167 small entities. This 

rule could apply to those small entities. 

The rule includes new reporting, 

recordkeeping, or other compliance 

requirements for small businesses. Prior 

to this rule, small businesses already 

had to monitor compliance with 

contract requirements pertaining to the 

increased domestic content threshold 

implemented in the FAR for contracted 

items. This final rule makes conforming 

changes to align the DFARS with the 

FAR while incorporating the DoDunique requirements. Due to small 

businesses’ familiarity with the FAR 

final rule, the increases in the domestic 

content threshold implemented in this 

rule are unlikely to result in additional 

disruption to existing contractor supply 

chains. 

The rule contains a few additional 

reporting requirements for certain 

offerors, including small businesses. 

Small businesses who submit an offer 

for a solicitation subject to the Buy 

American statute or the Balance of 

Payments Program already must list the 

foreign end products included in their 

offer. This final rule requires that the 

offeror also identify which of these 

foreign end products are not 

commercially available off-the-shelf 

items, do not consist wholly or 

predominantly of iron or steel or a 

combination of both, and meet or 

exceed the fallback domestic content 

threshold. 

There are no known significant 

alternative approaches to the rule that 

would meet the requirements of the 

Executive order. 

VII. Paperwork Reduction Act 

This final rule affects the information 

collection requirements in the provision 

at DFARS 252.225–7000, Buy 

American—Balance of Payments 

Program Certificate, currently approved 

under Office of Management and Budget 

Control Number 0704–0229, entitled 

Defense Federal Acquisition Regulation 

Supplement (DFARS) Defense Federal 

Acquisition Regulation Supplement Part 

225, Foreign Acquisition, and Related 

Clauses at 252.225; DD Form 2139, in 

accordance with the Paperwork 

Reduction Act (44 U.S.C. chapter 35). 

The impact, however, is negligible, 

because the provision already requires 

the offeror to identify in its proposal 

supplies that do not meet the definition 

of domestic end product, separately 

listing qualifying country and other 

foreign end products. The Buy 

American statute does not apply to 

acquisitions of commercial information 

technology, and therefore this provision 

would not apply to commercial 

products and commercial services. 

List of Subjects in 48 CFR Parts 213, 

225, and 252 

Government procurement. 

Jennifer D. Johnson, 

Editor/Publisher, Defense Acquisition 

Regulations System. 

Therefore, 48 CFR parts 213, 225, and 

252 are amended as follows: 

■ 1. The authority citation for parts 213, 

225, and 252 continues to read as 

follows: 

Authority: 41 U.S.C. 1303 and 48 CFR 

chapter 1. 

PART 213—SIMPLIFIED ACQUSITION 

PROCEDURES 

■ 2. Amend section 213.302–5 by 

revising paragraph (d) to read as 

follows: 

213.302–5 Clauses. 

* * * * * 

(d) When using the clause at FAR 

52.213–4, delete the reference to the 

clause at FAR 52.225–1, Buy 

American—Supplies. Instead, if the Buy 

American statute applies to the 

acquisition, use the clause at— 

(i) 252.225–7001, Buy American and 

Balance of Payments Program, or the 

appropriate alternate, as prescribed at 

225.1101(2); or 

(ii) 252.225–7036, Buy American— 

Free Trade Agreements—Balance of 


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11954 Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Rules and Regulations 

Payments Program, or the appropriate 

alternate, as prescribed at 225.1101(10). 

PART 225—FOREIGN ACQUISITION 

■ 3. Amend section 225.003— 

■ a. In the definition of ‘‘Domestic end 

product’’ by revising the first sentence 

of paragraph (1)(ii)(A) introductory text; 

and 

■ b. In the definition of ‘‘Qualifying 

country end product’’ by revising 

paragraph (2)(i) introductory text and 

paragraph (2)(ii). 

The revisions read as follows: 

225.003 Definitions. 

* * * * * 

Domestic end product means— 

(1) * * * 

(ii) * * * 

(A) The cost of its qualifying country 

components and its components that are 

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); or award is made 

before January 1, 2030, for a foreign end 

product that exceeds 55 percent 

domestic content (see 225.103(b)(ii)). 

* * * 

* * * * * 

Qualifying country end product 

means— 

* * * * * 

(2) * * * 

(i) The cost of the following types of 

components 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: 

* * * * * 

(ii) The end product is a COTS item. 

* * * * * 

■ 4. Amend section 225.101 by— 

■ a. Revising paragraph (a)(ii)(A); and 

■ b. Adding paragraph (d). 

The revision and addition read as 

follows: 

225.101 General. 

(a) * * * 

(ii)(A) Except for an end product that 

consists wholly or predominantly of 

iron or steel or a combination of both, 

the cost of its U.S. and qualifying 

country components 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, but see paragraph (d) of this 

section. This test is applied to end 

products only and not to individual 

components. 

* * * * * 

(d)(1) In lieu of the threshold 

increases in FAR 25.101(a)(2)(i), use the 

domestic content threshold increases in 

paragraph (a)(ii) of this section. The 

senior procurement executive may 

approve application of an alternate 

domestic content test, under which the 

domestic content threshold in effect at 

the time of contract award will apply to 

the entire period of performance of the 

contract, following consultation with 

the Office of Management and Budget’s 

Made in America Office. See PGI 

225.101 for guidance on documentation 

requirements when the senior 

procurement executive approves 

application of an alternate domestic 

content test. 

(2) When the senior procurement 

executive allows for application of an 

alternate domestic content test for the 

contract pursuant to FAR 25.101(d)(1) 

(but see paragraph (d)(1) of this 

section)— 

(A) See 225.1101(2)(iv) for use of 

alternate II of the clause at 252.225– 

7001, Buy American and Balance of 

Payments Program; 

(B) See 225.1101(2)(v) for use of 

alternate III of the clause at 252.225– 

7001, Buy American and Balance of 

Payments Program; 

(C) See 225.1101(9) for use of the 

basic or alternate provision at 252.225– 

7035, Buy American—Free Trade 

Agreements—Balance of Payments 

Program Certificate, or the basic or 

alternate clause at 252.225–7036, Buy 

American—Free Trade Agreements— 

Balance of Payments Program; and 

(D) See 225.1101(10)(i) for use of the 

basic or alternate clause at 252.225– 

7036, Buy American—Free Trade 

Agreements—Balance of Payments 

Program. 

■ 5. Amend section 225.103— 

■ a. By revising paragraph (b)(ii) 

introductory text; and 

■ b. In paragraph (c) by removing 

‘‘Subpart’’ and adding ‘‘subpart’’ in its 

place. 

The revision reads as follows: 

225.103 Exceptions. 

* * * * * 

(b) * * * 

(ii) A determination is not required 

before January 1, 2030, if there is an 

offer for a foreign end product that 

exceeds 55 percent domestic content. 

Except as provided in FAR 25.103(b)(3), 

the determination shall be approved— 

* * * * * 

■ 6. Redesignate section 225.105 as 

section 225.106 and revise newly 

redesignated section 225.106 to read as 

follows: 

225.106 Determining reasonableness of 

cost. 

(b) Use an evaluation factor of 50 

percent instead of the factors specified 

in FAR 25.106(b)(1)(i) and (c)(1)(i). 

225.170 [Amended] 

■ 7. Amend section 225.170 by 

removing ‘‘Subpart’’ and adding 

‘‘subpart’’ in its place. 

■ 8. Revise section 225.202 to read as 

follows: 

225.202 Exceptions. 

(a)(2) A nonavailability determination 

is not required for construction 

materials listed in FAR 25.104(a). For 

other materials, a nonavailability 

determination shall be approved at the 

levels specified in 225.103(b)(ii). Use 

the estimated value of the construction 

materials to determine the approval 

level. A nonavailability determination is 

not required before January 1, 2030, if 

there is an offer for foreign construction 

material that exceeds 55 percent 

domestic content (also see FAR 

25.204(b)(1)(ii) and (b)(2)(ii)). 

■ 9. Amend section 225.502— 

■ a. In paragraph (c)(i)(A) by removing 

‘‘subject only to the Buy American or 

Balance of Payments Program’’ and 

adding ‘‘subject only to the Buy 

American statute or the Balance of 

Payments Program’’ in its place; 

■ b. In paragraph (c)(i)(B) by removing 

‘‘factor’’ and adding ‘‘factor, but see 

225.106’’ in its place; and 

■ c. By revising paragraph (c)(ii)(C). 

The revision reads as follows: 

225.502 Application. 

* * * * * 

(c) * * * 

(ii) * * * 

(C) If the low offer is a foreign offer 

that is exempt from application of the 

Buy American or Balance of Payments 

Program evaluation factor, award on 

that offer. If the low offer is a qualifying 

country offer from a country listed at 

225.872–1(b), execute a determination 

in accordance with 225.872–4. A 

qualifying country offer is subject to the 

domestic content requirement for end 

products that are wholly or 

predominantly of iron or steel or a 

combination of both. 

* * * * * 


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■ 10. Amend section 225.1101— 

■ a. In paragraph (1) introductory text 

removing the last sentence in the text; 

■ b. In paragraph (1)(i) by removing 

‘‘basic clause’’ and adding ‘‘basic clause 

or alternate II of the clause’’ in its place; 

■ c. In paragraph (1)(ii) by removing 

‘‘alternate I of the clause’’ and adding 

‘‘alternate I or alternate III of the clause’’ 

in its place; 

■ d. In paragraph (2)(i) by— 

■ i. Removing ‘‘basic or the alternate’’ 

and adding ‘‘basic or an alternate’’ in its 

place; and 

■ ii. Removing ‘‘Act’’; 

■ e. By adding paragraphs (2)(iv) and 

(v); 

■ f. By redesignating paragraphs (6)(iii) 

and (iv) as (6)(v) and (vi), respectively; 

and adding new paragraphs (6)(iii) and 

(iv); 

■ g. In paragraph (9) introductory text, 

removing the last sentence; 

■ h. In paragraph (9)(i) by removing 

‘‘basic of the clause’’ and adding ‘‘basic 

or alternate VI of the clause’’ in its 

place; 

■ i. In paragraph (9)(ii) by removing 

‘‘alternate I of the clause’’ and adding 

‘‘alternate I or alternate VII of the 

clause’’ in its place; 

■ j. In paragraph (9)(iii) by removing 

‘‘alternate II of the clause’’ and adding 

‘‘alternate II or alternate VIII of the 

clause’’ in its place; 

■ k. In paragraph (9)(iv) by removing 

‘‘alternate III of the clause’’ and adding 

‘‘alternate III or alternate IX of the 

clause’’ in its place; 

■ l. In paragraph (9)(v) by removing 

‘‘alternate IV of the clause’’ and adding 

‘‘alternate IV or alternate X of the 

clause’’ in its place; 

■ m. In paragraph (9)(vi) by removing 

‘‘alternate V of the clause’’ and adding 

‘‘alternate V or alternate XI of the 

clause’’ in its place; and 

■ n. In paragraph (10)(i) by adding 

paragraphs (G) through (L). 

The additions read as follows: 

225.1101 Acquisition of supplies. 

* * * * * 

(2) * * * 

(iv) Use alternate II of the clause in 

lieu of the basic clause in solicitations 

and contracts if— 

(A) The acquisition is not of end 

products listed in 225.401–70 in 

support of operations in Afghanistan; 

and 

(B) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(v) Use alternate III of the clause in 

lieu of Alternate I of the clause in 

solicitations and contracts if— 

(A) The acquisition is of end products 

listed in 225.401–70 in support of 

operations in Afghanistan; and 

(B) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

* * * * * 

(6) * * * 

(iii) Use the alternate III clause in lieu 

of the basic clause in solicitations and 

contracts that are not of end products in 

support of operations in Afghanistan or 

that include the clause at 252.225–7024, 

Requirement for Products or Services 

from Afghanistan, when an alternate 

domestic content threshold will apply 

to the entire period of performance as 

approved by the senior procurement 

executive (see 225.101(d)). 

(iv) Use the alternate IV clause in lieu 

of the alternate II clause in solicitations 

and contracts that do not include the 

clause at 252.225–7024, Requirement for 

Products or Services from Afghanistan, 

when— 

(A) The acquisition is of end products 

in support of operations in Afghanistan; 

and 

(B) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

* * * * * 

(10) * * * 

(i) * * * 

(G) Use the alternate VI clause in lieu 

of the basic clause in solicitations and 

contracts, except if the acquisition is of 

end products in support of operations in 

Afghanistan, when— 

(1) The estimated value equals or 

exceeds $100,000 but is less than 

$183,000; and 

(2) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(H) Use the alternate VII clause in lieu 

of the alternate I clause in solicitations 

and contracts, except if the acquisition 

is of end products in support of 

operations in Afghanistan, when— 

(1) The estimated value is less than 

$92,319; and 

(2) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(I) Use the alternate VIII clause in lieu 

of the alternate II clause in solicitations 

and contracts when— 

(1) The estimated value is less than 

$183,000; 

(2) The acquisition is of end products 

in support of operations in Afghanistan; 

and 

(3) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(J) Use the alternate IX clause in lieu 

of the alternate III clause in solicitations 

and contracts when— 

(1) The estimated value is less than 

$92,319; 

(2) The acquisition is of end products 

in support of operations in Afghanistan; 

and 

(3) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive in 

accordance with FAR 25.101(d). 

(K) Use the alternate X clause in lieu 

of the alternate IV clause in solicitations 

and contracts, except if the acquisition 

is of end products in support of 

operations in Afghanistan, when— 

(1) The estimated value equals or 

exceeds $92,319 but is less than 

$100,000; and 

(2) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(L) Use the alternate XI clause in lieu 

of the alternate V clause in solicitations 

and contracts when— 

(1) The estimated value equals or 

exceeds $92,319 but is less than 

$100,000; 

(2) The acquisition is of end products 

in support of operations in Afghanistan; 

and 

(3) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

* * * * * 

■ 11. Amend section 225.7503 by— 

■ a. Adding paragraphs (a)(3) and (4); 

and 

■ b. Adding paragraphs (b)(5) through 

(8). 

The additions read as follows: 

225.7503 Contract clauses. 

(a) * * * 

(3) Use the alternate II clause in lieu 

of the basic clause if an alternate 

domestic content threshold will apply 

to the entire period of performance as 

approved by the senior procurement 

executive (see 225.101(d)), unless the 

acquisition is in support of operations 

in Afghanistan. 

(4) Use the alternate III clause in lieu 

of the alternate I clause if— 


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11956 Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Rules and Regulations 

(i) The acquisition is in support of 

operations in Afghanistan; and 

(ii) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(b) * * * 

(5) Use the alternate IV clause in lieu 

of the basic clause in solicitations and 

contracts, unless the acquisition is in 

support of operations in Afghanistan, 

when— 

(i) The estimated value is $12,001,460 

or more; and 

(ii) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(6) Use the alternate V clause in lieu 

of the alternate I clause in solicitations 

and contracts, unless the acquisition is 

in support of operations in Afghanistan, 

when— 

(i) The estimated value is $7,032,000 

or more; and 

(ii) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(7) Use the alternate VI clause in lieu 

of the alternate II clause in solicitations 

and contracts when— 

(i) The estimated value is $12,001,460 

or more; 

(ii) The acquisition is in support of 

operations in Afghanistan; and 

(iii) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

(8) Use the alternate VII clause in lieu 

of the alternate III clause in solicitations 

and contracts when— 

(i) The estimated value is $7,032,000 

or more but less than $12,001,460; 

(ii) The acquisition is in support of 

operations in Afghanistan; and 

(iii) An alternate domestic content 

threshold will apply to the entire period 

of performance as approved by the 

senior procurement executive (see 

225.101(d)). 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 12. Amend section 252.225–7000— 

■ a. By revising the provision date and 

paragraphs (a) and (c); and 

■ b. In Alternate I, by revising the 

provision date and paragraphs (a) and 

(c). 

The revisions read as follows: 

252.225–7000 Buy American—Balance of 

Payments Program Certificate. 

* * * * * 

Buy American—Balance of Payments 

Program Certificate—Basic (Feb 2024) 

(a) Definitions. Commercially available offthe-shelf (COTS) item, component, critical 

component, critical item, domestic end 

product, foreign end product, qualifying 

country, qualifying country end product, and 

United States, as used in this provision, have 

the meanings given in the 252.225–7001, Buy 

American and Balance of Payments 

Program—Basic clause of this solicitation. 

* * * * * 

(c) Certifications and identification of 

country of origin. 

(1) For all line items subject to the Buy 

American and Balance of Payments 

Program—Basic clause of this solicitation, 

the Offeror certifies that— 

(i) Each end product, except those listed in 

paragraphs (c)(2) or (3) of this provision, is 

a domestic end product and that each 

domestic end product listed in paragraph 

(c)(4) of this provision contains a critical 

component or a critical item; and 

(ii) For end products other than COTS 

items, components of unknown origin are 

considered to have been mined, produced, or 

manufactured outside the United States or a 

qualifying country. For those end products 

that do not consist wholly or predominantly 

of iron or steel or a combination of both, the 

Offeror shall also indicate whether these 

foreign end products exceed 55 percent 

domestic content, except for those that are 

COTS items. If the percentage of the domestic 

content is unknown, select ‘‘no’’. 

(2) The Offeror certifies that the following 

end products are qualifying country end 

products: 

Line item No. Country of origin 

(3) The following end products are other 

foreign end products, including end products 

manufactured in the United States that do 

not qualify as domestic end products. For 

those foreign end products that do not 

consist wholly or predominantly of iron or 

steel or a combination of both, the Offeror 

shall also indicate whether these foreign end 

products exceed 55 percent domestic 

content, except for those that are COTS 

items. If the percentage of the domestic 

content is unknown, select ‘‘no’’. 

Line item No. Country of origin 

(If known) 

Exceeds 55% domestic content 

(yes/no) 

(4) The Offeror shall separately list the line 

item numbers of domestic end products that 

contain a critical component or a critical item 

(see Federal Acquisition Regulation 25.105). 

Domestic end products containing a 

critical component or a critical item: Line 

Item Number [List as necessary] 

* * * * * 

Alternate I. * * * 

Buy American—Balance of Payments 

Program Certificate—Alternate I (Feb 2024) 

(a) Definitions. Commercially available offthe-shelf (COTS) item, component, critical 

component, critical item, domestic end 

product, foreign end product, qualifying 

country, qualifying country end product, 

South Caucasus/Central and South Asian 

(SC/CASA) state, South Caucasus/Central 

and South Asian (SC/CASA) state end 

product, and United States, as used in this 

provision, have the meanings given in the 

252.225–7001, Buy American and Balance of 

Payments Program—Alternate I clause of this 

solicitation. 

* * * * * 

(c) Certifications and identification of 

country of origin. 

(1) For all line items subject to the Buy 

American and Balance of Payments 


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Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Rules and Regulations 11957 

Program—Alternate I clause of this 

solicitation, the Offeror certifies that— 

(i) Each end product, except those listed in 

paragraphs (c)(2) or (3) of this provision, is 

a domestic end product and that each 

domestic end product listed in paragraph 

(c)(4) of this provision contains a critical 

component or a critical item; and 

(ii) For end products other than COTS 

items, components of unknown origin are 

considered to have been mined, produced, or 

manufactured outside the United States or a 

qualifying country. For those end products 

that do not consist wholly or predominantly 

of iron or steel or a combination of both, the 

Offeror shall also indicate whether these 

foreign end products exceed 55 percent 

domestic content, except for those that are 

COTS items. If the percentage of the domestic 

content is unknown, select ‘‘no’’. 

(2) The Offeror certifies that the following 

end products are qualifying country end 

products or SC/CASA state end products: 

Line item No. Country of origin 

. 

(3) The following end products are other 

foreign end products, including end products 

manufactured in the United States that do 

not qualify as domestic end products. For 

those foreign end products that do not 

consist wholly or predominantly of iron or 

steel or a combination of both, the Offeror 

shall also indicate whether these foreign end 

products exceed 55 percent domestic 

content, except for those that are COTS 

items. If the percentage of the domestic 

content is unknown, select ‘‘no’’. 

Line item No. Country of origin 

(if known) 

Exceeds 55% domestic content 

(yes/no) 

(4) The Offeror shall separately list the line 

item numbers of domestic end products that 

contain a critical component or a critical item 

(see Federal Acquisition Regulation 25.105). 

Domestic end products containing a 

critical component or a critical item: Line 

Item Number [List as necessary]. 

* * * * * 

■ 13. Amend section 252.225–7001— 

■ a. By revising the clause date; 

■ b. In paragraph (a)— 

■ i. In the definition of ‘‘Commercially 

available off-the-shelf (COTS) item’’ 

paragraph (1)(i) by removing ‘‘Federal 

Acquisition Regulation’’ and adding 

‘‘Federal Acquisition Regulation (FAR)’’ 

in its place; 

■ ii. By adding, in alphabetical order, 

the definitions of ‘‘Critical component’’ 

and ‘‘Critical item’’; 

■ iii. In the definition of ‘‘Domestic end 

product’’ by revising the first sentence 

of paragraph (1)(ii)(A) introductory text; 

■ iv. In the definition of ‘‘Qualifying 

country end product’’ by revising 

paragraph (2)(i) introductory text; 

■ c. By revising paragraph (b); 

■ d. In Alternate I— 

■ i. By revising the clause date; 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

available off-the-shelf (COTS) item’’ 

paragraph (1)(i) by removing ‘‘Federal 

Acquisition Regulation’’ and adding 

‘‘Federal Acquisition Regulation (FAR)’’ 

in its place; 

■ B. By adding, in alphabetical order, 

the definitions of ‘‘Critical component’’ 

and ‘‘Critical item’’; 

■ C. In the definition of ‘‘Domestic end 

product’’ by revising the first sentence 

of paragraph (1)(ii)(A) introductory text; 

■ D. In the definition of ‘‘Qualifying 

country end product’’ by revising 

paragraph (2)(i) introductory text; and 

■ e. By adding Alternate II and Alternate 

III. 

The revisions and additions read as 

follows: 

252.225–7001 Buy American and Balance 

of Payments Program. 

* * * * * 

Buy American and Balance of Payments 

Program—Basic (Feb 2024) 

(a) * * * 

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 FAR 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 

FAR 25.105. 

Domestic end product means— 

(1) * * * 

(ii) * * * 

(A) The cost of its qualifying country 

components and its components that are 

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), 

or award is made before January 1, 2030, for 

a foreign end product that exceeds 55 percent 

domestic content (see Defense Federal 

Acquisition Regulation Supplement 

225.103(b)(ii)). * * * 

* * * * * 

Qualifying country end product means— 

* * * * * 

(2) * * * 

(i) The cost of the following types of 

components 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: 

* * * * * 

(b) This clause implements 41 U.S.C. 

chapter 83, Buy American. In accordance 

with 41 U.S.C. 1907, the component test of 

the Buy American statute is waived for an 

end product that is a COTS item (see FAR 

12.505(a)(1)). Unless otherwise specified, this 

clause applies to all line items in the 

contract. 

* * * * * 

Alternate I. * * * 

Buy American and Balance of Payments 

Program—Alternate I (Feb 2024) 

(a) * * * 

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 FAR 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 

FAR 25.105. 

Domestic end product means— 

(1) * * * 

(ii) * * * 

(A) The cost of its qualifying country 

components and its components that are 

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 


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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), 

or award is made before January 1, 2030, for 

a foreign end product that exceeds 55 percent 

domestic content (see Defense Federal 

Acquisition Regulation Supplement 

225.103(b)(ii)). * * * 

* * * * * 

Qualifying country end product means— 

* * * * * 

(2) * * * 

(i) The cost of the following types of 

components 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: 

* * * * * 

Alternate II. As prescribed in 225.1101(2)(i) 

and (2)(iv), use the following clause, which 

includes, in the definitions of ‘‘domestic end 

product’’ at paragraph (1)(ii)(A) and 

‘‘qualifying country end product’’ at 

paragraph (2)(i), the domestic content 

threshold that will apply to the entire 

contract period of performance. 

Buy American and Balance of Payments 

Program—Alternate II (Feb 2024) 

(a) Definitions. As used in this clause— 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 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 

FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

mined, produced, or manufactured in the 

United States exceeds, for the entire period 

of performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

The cost of components includes 

transportation costs to the place of 

incorporation into the end product and U.S. 

duty (whether or not a duty-free entry 

certificate is issued). Components of 

unknown origin are treated as foreign. Scrap 

generated, collected, and prepared for 

processing in the United States is considered 

domestic. A component is considered to have 

been mined, produced, or manufactured in 

the United States (regardless of its source in 

fact) if the end product in which it is 

incorporated is manufactured in the United 

States and the component is of a class or kind 

for which the Government has determined 

that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end 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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 

performance for a contract awarded in 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 


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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. 

(b) This clause implements 41 U.S.C. 

chapter 83, Buy American. In accordance 

with 41 U.S.C. 1907, the component test of 

the Buy American statute is waived for an 

end product that is a COTS item (see FAR 

12.505(a)(1)). Unless otherwise specified, this 

clause applies to all line items in the 

contract. 

(c) The Contractor shall deliver only 

domestic end products unless, in its offer, it 

specified delivery of other end products in 

the Buy American—Balance of Payments 

Program Certificate provision of the 

solicitation. If the Contractor certified in its 

offer that it will deliver a qualifying country 

end product, the Contractor shall deliver a 

qualifying country end product or, at the 

Contractor’s option, a domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate III. As prescribed in 

225.1101(2)(i) and (2)(v), use the following 

clause, which includes, in the definitions of 

‘‘domestic end product’’ at paragraph 

(1)(ii)(A) and ‘‘qualifying country end 

product’’ at paragraph (2)(i), the domestic 

content threshold that will apply to the entire 

contract period of performance; adds ‘‘South 

Caucasus/Central and South Asian (SC/ 

CASA) state’’ and ‘‘South Caucasus/Central 

and South Asian (SC/CASA) state end 

product’’ to paragraph (a); and uses different 

paragraphs (b) and (c) than the basic clause: 

Buy American and Balance of Payments 

Program—Alternate III (Feb 2024) 

(a) Definitions. As used in this clause— 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 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 

FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

mined, produced, or manufactured in the 

United States exceeds, for the entire period 

of performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

The cost of components includes 

transportation costs to the place of 

incorporation into the end product and U.S. 

duty (whether or not a duty-free entry 

certificate is issued). Components of 

unknown origin are treated as foreign. Scrap 

generated, collected, and prepared for 

processing in the United States is considered 

domestic. A component is considered to have 

been mined, produced, or manufactured in 

the United States (regardless of its source in 

fact) if the end product in which it is 

incorporated is manufactured in the United 

States and the component is of a class or kind 

for which the Government has determined 

that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end 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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 


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(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

South Caucasus/Central and South Asian 

(SC/CASA) state end product means an 

article that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; 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 SC/CASA state 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

(b) This clause implements the Balance of 

Payments Program. Unless otherwise 

specified, this clause applies to all line items 

in the contract. 

(c) The Contractor shall deliver only 

domestic end products unless, in its offer, it 

specified delivery of other end products in 

the Buy American—Balance of Payments 

Program Certificate provision of the 

solicitation. If the Contractor certified in its 

offer that it will deliver a qualifying country 

end product or an SC/CASA state end 

product, the Contractor shall deliver a 

qualifying country end product, an SC/CASA 

state end product, or, at the Contractor’s 

option, a domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

■ 14. Amend section 252.225–7021— 

■ a. By revising the clause date; 

■ b. In paragraph (a) in the definition of 

‘‘Qualifying country end product’’ by 

revising paragraph (2)(i); 

■ c. In Alternate II— 

■ i. By revising the clause date; and 

■ ii. In paragraph (a) in the definition of 

‘‘Qualifying country end product’’ 

revising paragraph (2)(i); and 

■ d. By adding Alternate III and 

Alternate IV. 

The revisions and additions read as 

follows: 

252.225–7021 Trade Agreements. 

* * * * * 

Trade Agreements—Basic (Feb 2024) 

(a) * * * 

Qualifying country end product means— 

* * * 

(2) * * * 

(i) The cost of the following types of 

components 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: 

* * * * * 

Alternate II. * * * 

Trade Agreements—Alternate II (Feb 2024) 

(a) * * * 

Qualifying country end product means— 

* * * * * 

(2) * * * 

(i) The cost of the following types of 

components 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: 

* * * * * 

Alternate III. As prescribed in 225.1101(6) 

and (6)(iii), use the following clause, which 

includes, in the definition of ‘‘qualifying 

country end product’’ at paragraph (2)(i), the 

domestic content threshold that will apply to 

the entire contract period of performance. 

Trade Agreements—Alternate III (Feb 2024) 

(a) Definitions. As used in this clause— 

Caribbean Basin country end product— 

(1) Means an article that— 

(i) Is wholly the growth, product, or 

manufacture of a Caribbean Basin country; or 

(ii) 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. 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself; and 

(2) Excludes products, other than 

petroleum and any product derived from 

petroleum, that are not granted duty-free 

treatment under the Caribbean Basin 

Economic Recovery Act (19 U.S.C. 2703(b)). 

These exclusions presently consist of— 

(i) Textiles, apparel articles, footwear, 

handbags, luggage, flat goods, work gloves, 

leather wearing apparel, and handloomed, 

handmade, or folklore articles that are not 

granted duty-free status in the Harmonized 

Tariff Schedule of the United States 

(HTSUS); 

(ii) Tuna, prepared or preserved in any 

manner in airtight containers; and 

(iii) 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 HTSUS column 2 rates of duty (HTSUS 

General Note 3(b)) apply. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an end 

product. 

‘‘Designated country’’ means— 

(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 the 

United Kingdom); 

(2) A Free Trade Agreement country 

(Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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, TimorLeste, 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, a Free Trade 


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Agreement country end product, a least 

developed country end product, or a 

Caribbean Basin country end product. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Free Trade Agreement country end product 

means an article that— 

(1) Is wholly the growth, product, or 

manufacture of a Free Trade Agreement 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Nondesignated country end product means 

any end product that is not a U.S.-made end 

product or a designated country end product. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States; or 

(ii) The end product is a COTS item. 

United States means the 50 States, the 

District of Columbia, and outlying areas. 

U.S.-made end product means an article 

that— 

(1) Is mined, produced, or manufactured in 

the United States; or 

(2) 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. 

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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only U.S.-made, qualifying country, 

or designated country end products unless— 

(1) In its offer, the Contractor specified 

delivery of other nondesignated country end 

products in the Trade Agreements Certificate 

provision of the solicitation; and 

(2)(i) Offers of U.S.-made, qualifying 

country, or designated country end products 

from responsive, responsible offerors are 

either not received or are insufficient to fill 

the Government’s requirements; or 

(ii) A national interest waiver has been 

granted. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(e) The HTSUS is available at http://

www.usitc.gov/tata/hts/bychapter/index.htm. 

The following sections of the HTSUS provide 

information regarding duty-free status of 

articles specified in the definition of 

‘‘Caribbean Basin country end product’’ 

within paragraph (a) of this clause: 

(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. 

(End of clause) 

Alternate IV. As prescribed in 225.1101(6) 

and (6)(iv), use the following clause, which 

(i) includes, in the definition of ‘‘qualifying 

country end product’’ at paragraph (2)(i), the 

domestic content threshold that will apply to 

the entire contract period of performance; (ii) 

adds ‘‘South Caucasus/Central and South 

Asian (SC/CASA) state’’ and ‘‘South 

Caucasus/Central and South Asian (SC/ 

CASA) state end product’’ to paragraph (a); 

(iii) uses a different paragraph (c) than the 

basic clause; (iv) adds a new paragraph (d); 

and (v) includes paragraphs (e) and (f) which 

are the same paragraphs (d) and (e) of the 

basic clause: 

Trade Agreements—Alternate IV (Feb 2024) 

(a) Definitions. As used in this clause— 

Caribbean Basin country end product— 

(1) Means an article that— 

(i) Is wholly the growth, product, or 

manufacture of a Caribbean Basin country; or 

(ii) 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. 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself; and 

(2) Excludes products, other than 

petroleum and any product derived from 

petroleum, that are not granted duty-free 

treatment under the Caribbean Basin 


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11962 Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Rules and Regulations 

Economic Recovery Act (19 U.S.C. 2703(b)). 

These exclusions presently consist of— 

(i) Textiles, apparel articles, footwear, 

handbags, luggage, flat goods, work gloves, 

leather wearing apparel, and handloomed, 

handmade, or folklore articles that are not 

granted duty-free status in the Harmonized 

Tariff Schedule of the United States 

(HTSUS); 

(ii) Tuna, prepared or preserved in any 

manner in airtight containers; and 

(iii) 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 HTSUS column 2 rates of duty (HTSUS 

General Note 3(b)) apply. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of commercial 

product in section 2.101 of the Federal 

Acquisition Regulation); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an end 

product. 

Designated country means— 

(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 the 

United Kingdom); 

(2) A Free Trade Agreement country 

(Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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, East Timor, 

Equatorial Guinea, Eritrea, Ethiopia, Gambia, 

Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, 

Lesotho, Liberia, Madagascar, Malawi, 

Maldives, Mali, Mauritania, Mozambique, 

Nepal, Niger, Rwanda, Samoa, Sao Tome and 

Principe, Senegal, Sierra Leone, Solomon 

Islands, Somalia, Tanzania, 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, a Free Trade 

Agreement country end product, a least 

developed country end product, or a 

Caribbean Basin country end product. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Free Trade Agreement country end product 

means an article that— 

(1) Is wholly the growth, product, or 

manufacture of a Free Trade Agreement 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Nondesignated country end product means 

any end product that is not a U.S.-made end 

product or a designated country end product. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States; or 

(ii) The end product is a COTS item. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

South Caucasus/Central and South Asian 

(SC/CASA) state end product means an 

article that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; 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 SC/CASA state 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

United States means the 50 States, the 

District of Columbia, and outlying areas. 

U.S.-made end product means an article 

that— 


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(1) Is mined, produced, or manufactured in 

the United States; or 

(2) 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. 

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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only U.S.-made, qualifying country, 

SC/CASA state, or designated country end 

products unless— 

(1) In its offer, the Contractor specified 

delivery of other nondesignated country end 

products in the Trade Agreements Certificate 

provision of the solicitation; and 

(2)(i) Offers of U.S.-made, qualifying 

country, SC/CASA state, or designated 

country end products from responsive, 

responsible offerors are either not received or 

are insufficient to fill the Government’s 

requirements; or 

(ii) A national interest waiver has been 

granted. 

(d) If the Contractor is from an SC/CASA 

state, the Contractor shall inform its 

government of its participation in this 

acquisition and that it generally will not have 

such opportunity in the future unless its 

government provides reciprocal procurement 

opportunities to U.S. products and services 

and suppliers of such products and services. 

(e) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(f) The HTSUS is available at http://

www.usitc.gov/tata/hts/bychapter/index.htm. 

The following sections of the HTSUS provide 

information regarding duty-free status of 

articles specified in the definition of 

‘‘Caribbean Basin country end product’’ 

within paragraph (a) of this clause: 

(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. 

(End of clause) 

■ 15. Amend section 252.225–7035— 

■ a. By revising the provision date; 

■ b. In paragraph (a) by removing 

‘‘ ‘‘component,’’ ’’ and ‘‘Buy American’’ 

and adding ‘‘ ‘‘component,’’ ‘‘critical 

component,’’ ‘‘critical item,’’ ’’ and 

‘‘252.225–7036, Buy American’’ in their 

places, respectively; 

■ c. By revising paragraph (c); 

■ d. By adding ‘‘(End of provision)’’ at 

the end of the provision; 

■ e. In Alternate I— 

■ i. By revising the introductory text; 

■ ii. By revising the provision date; 

■ iii. In paragraph (a) by removing 

‘‘ ‘‘component,’’ ’’ and ‘‘Buy American’’ 

and adding ‘‘ ‘‘component,’’ ‘‘critical 

component,’’ ‘‘critical item,’’ ’’ and 

‘‘252.225–7036, Buy American’’ in their 

places, respectively; 

■ iv. By revising paragraph (c); 

■ f. In Alternate II— 

■ i. By revising the provision date; 

■ ii. In paragraph (a) by removing 

‘‘ ‘‘component,’’ ’’ and ‘‘Buy American’’ 

and adding ‘‘ ‘‘component,’’ ‘‘critical 

component,’’ ‘‘critical item,’’ ’’ and 

‘‘252.225–7036, Buy American’’ in their 

places, respectively; 

■ iii. By revising paragraph (c); 

■ g. In Alternate III— 

■ i. By revising the provision date; 

■ ii. In paragraph (a) by removing 

‘‘ ‘‘component,’’ ’’ and ‘‘Buy American’’ 

and adding ‘‘ ‘‘component,’’ ‘‘critical 

component,’’ ‘‘critical item,’’ ’’ and 

‘‘252.225–7036, Buy American’’ in their 

places, respectively; 

■ iii. By revising paragraph (c); 

■ h. In Alternate IV— 

■ i. By revising the provision date; 

■ ii. In paragraph (a) by removing 

‘‘ ‘‘component,’’ ’’ and ‘‘Buy American’’ 

and adding ‘‘ ‘‘component,’’ ‘‘critical 

component,’’ ‘‘critical item,’’ ’’ and 

‘‘252.225–7036, Buy American’’ in their 

places, respectively; 

■ iii. By revising paragraph (c); and 

■ i. In Alternate V— 

■ i. By revising the provision date; 

■ ii. In paragraph (a) by removing 

‘‘ ‘‘component,’’ ’’ and ‘‘Buy American’’ 

and adding ‘‘ ‘‘component,’’ ‘‘critical 

component,’’ ‘‘critical item,’’ ’’ and 

‘‘252.225–7036, Buy American’’ in their 

places, respectively; and 

■ iii. By revising paragraph (c). 

The revisions read as follows: 

252.225–7035 Buy American—Free Trade 

Agreements—Balance of Payments 

Program Certificate. 

* * * * * 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Basic (Feb 2024) 

* * * * * 

(c) Certifications and identification of 

country of origin. 

(1) For all line items subject to the Buy 

American—Free Trade Agreements—Balance 

of Payments Program—Basic clause of this 

solicitation, the Offeror certifies that— 

(i) Each end product, except the end 

products listed in paragraph (c)(2) of this 

provision, is a domestic end product; 

(ii) Each domestic end product listed in 

paragraph (c)(3) of this provision contains a 

critical component or a critical item; and 

(iii) Components of unknown origin are 

considered to have been mined, produced, or 

manufactured outside the United States or a 

qualifying country. 

(2) The Offeror shall identify all end 

products that are not domestic end products. 

(i) The Offeror certifies that the following 

supplies are qualifying country (except 

Australian) end products: 

Line item No. Country of origin 

(ii) The Offeror certifies that the following 

supplies are Free Trade Agreement country 

end products other than Bahraini end 

products, Moroccan end products, 

Panamanian end products or Peruvian end 

products: 

Line item No. Country of origin 

(iii) The following supplies are other 

foreign end products, including end products 

manufactured in the United States that do 

not qualify as domestic end products. For 

those foreign end products that do not 

consist wholly or predominantly of iron or 

steel or a combination of both, the Offeror 

shall also indicate whether these foreign end 

products exceed 55 percent domestic 

content, except those that are COTS items. If 

the percentage of the domestic content is 

unknown, select ‘‘no’’. 

Line item No. Country of origin 

(if known) 

Exceeds 55% domestic content 

(yes/no) 


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(3) The Offeror shall list the line item 

numbers of domestic end products that 

contain a critical component or a critical item 

(see section 25.105 of the Federal Acquisition 

Regulation). 

Line Item Number: llllllllllll

[List as necessary] 

(End of provision) 

Alternate I. As prescribed in 

225.1101(9) and (9)(ii), use the 

following provision, which does not use 

the phrases ‘‘Bahraini end product,’’ 

‘‘Free Trade Agreement country,’’ ‘‘Free 

Trade Agreement country end product,’’ 

‘‘Moroccan end product,’’ ‘‘Panamanian 

end product,’’ and ‘‘Peruvian end 

products’’ in paragraph (a); does not use 

‘‘Free Trade Agreement country end 

products other than Bahraini end 

products, Moroccan end products, 

Panamanian end products, or Peruvian 

end products’’ in paragraphs (b)(2) and 

(c)(2)(ii); does not use ‘‘Australian or’’ in 

paragraph (c)(2)(i); and includes ‘‘that 

are mined, produced, or manufactured 

in the United States’’ in paragraph 

(c)(2)(ii): 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate I (Feb 2024) 

* * * * * 

(c) Certifications and identification of 

country of origin. 

(1) For all line items subject to the Buy 

American—Free Trade Agreements—Balance 

of Payments Program—Alternate I clause of 

this solicitation, the Offeror certifies that— 

(i) Each end product, except the end 

products listed in paragraph (c)(2) of this 

provision, is a domestic end product; 

(ii) Each domestic end product listed in 

paragraph (c)(3) of this provision contains a 

critical component or a critical item; and 

(iii) Components of unknown origin are 

considered to have been mined, produced, or 

manufactured outside the United States or a 

qualifying country. 

(2) The Offeror shall identify all end 

products that are not domestic end products. 

(i) The Offeror certifies that the following 

supplies are qualifying country end products: 

Line item No. Country of origin 

(ii) The following supplies are other 

foreign end products, including end products 

manufactured in the United States that do 

not qualify as domestic end products. For 

those foreign end products that do not 

consist wholly or predominantly of iron or 

steel or a combination of both, the Offeror 

shall also indicate whether these foreign end 

products exceed 55 percent domestic 

content, except those that are COTS items 

that are mined, produced, or manufactured in 

the United States. If the percentage of the 

domestic content is unknown, select ‘‘no’’. 

Line item No. Country of origin 

(if known) 

Exceeds 55% domestic content 

(yes/no) 

(3) The Offeror shall list the line item 

numbers of domestic end products that 

contain a critical component or a critical item 

(see section 25.105 of the Federal Acquisition 

Regulation). 

Line Item Number: llllllllllll

[List as necessary] 

* * * * * 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate II (Feb 2024) 

* * * * * 

(c) Certifications and identification of 

country of origin. 

(1) For all line items subject to the Buy 

American—Free Trade Agreements—Balance 

of Payments Program—Alternate II clause of 

this solicitation, the Offeror certifies that— 

(i) Each end product, except the end 

products listed in paragraph (c)(2) of this 

provision, is a domestic end product; 

(ii) Each domestic end product listed in 

paragraph (c)(3) of this provision contains a 

critical component or a critical item; and 

(iii) Components of unknown origin are 

considered to have been mined, produced, or 

manufactured outside the United States or a 

qualifying country. 

(2) The Offeror shall identify all end 

products that are not domestic end products. 

(i) The Offeror certifies that the following 

supplies are qualifying country (except 

Australian) or SC/CASA state end products: 

Line item No. Country of origin 

(ii) The Offeror certifies that the following 

supplies are Free Trade Agreement country 

end products other than Bahraini end 

products, Moroccan end products, 

Panamanian end products, or Peruvian end 

products: 

Line item No. Country of origin 

(iii) The following supplies are other 

foreign end products, including end products 

manufactured in the United States that do 

not qualify as domestic end products. For 

those foreign end products that do not 

consist wholly or predominantly of iron or 

steel or a combination of both, the Offeror 

shall also indicate whether these foreign end 

products exceed 55 percent domestic 

content, except those that are COTS items. If 

the percentage of the domestic content is 

unknown, select ‘‘no’’. 

Line item No. Country of origin 

(if known) 

Exceeds 55% domestic content 

(yes/no) 

(3) The Offeror shall list the line item 

numbers of domestic end products that 

contain a critical component or a critical item 

(see section 25.105 of the Federal Acquisition 

Regulation). 

Line Item Number: llllllllllll

[List as necessary] 

* * * * * 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate III (Feb 2024) 

* * * * * 

(c) Certifications and identification of 

country of origin. 

(1) For all line items subject to the Buy 

American—Free Trade Agreements—Balance 

of Payments Program—Alternate III clause of 

this solicitation, the Offeror certifies that— 

(i) Each end product, except the end 

products listed in paragraph (c)(2) of this 

provision, is a domestic end product; 

(ii) Each domestic end product listed in 

paragraph (c)(3) of this provision contains a 

critical component or a critical item; and 

(iii) Components of unknown origin are 

considered to have been mined, produced, or 

manufactured outside the United States or a 

qualifying country. 


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(2) The Offeror shall identify all end 

products that are not domestic end products. 

(i) The Offeror certifies that the following 

supplies are qualifying country or SC/CASA 

state end products: 

Line item No. Country of origin 

(ii) The Offeror certifies that the following 

supplies are Free Trade Agreement country 

end products other than Bahraini end 

products, Moroccan end products, 

Panamanian end products, or Peruvian end 

products: 

Line item No. Country of origin 

(iii) The following supplies are other 

foreign end products, including end products 

manufactured in the United States that do 

not qualify as domestic end products. For 

those foreign end products that do not 

consist wholly or predominantly of iron or 

steel or a combination of both, the Offeror 

shall also indicate whether these foreign end 

products exceed 55 percent domestic 

content, except those that are COTS items. If 

the percentage of the domestic content is 

unknown, select ‘‘no’’. 

Line item No. Country of origin 

(if known) 

Exceeds 55% domestic content 

(yes/no) 

(3) The Offeror shall list the line item 

numbers of domestic end products that 

contain a critical component or a critical item 

(see section 25.105 of the Federal Acquisition 

Regulation). 

Line Item Number: llllllllllll

[List as necessary] 

* * * * * 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate IV (Feb 2024) 

* * * * * 

(c) Certifications and identification of 

country of origin. 

(1) For all line items subject to the Buy 

American—Free Trade Agreements—Balance 

of Payments Program—Alternate IV clause of 

this solicitation, the Offeror certifies that— 

(i) Each end product, except the end 

products listed in paragraph (c)(2) of this 

provision, is a domestic end product; 

(ii) Each domestic end product listed in 

paragraph (c)(3) of this provision contains a 

critical component or a critical item; and 

(iii) Components of unknown origin are 

considered to have been mined, produced, or 

manufactured outside the United States or a 

qualifying country. 

(2) The Offeror shall identify all end 

products that are not domestic end products. 

(i) The Offeror certifies that the following 

supplies are qualifying country (except 

Australian) end products: 

Line item No. Country of origin 

(ii) The Offeror certifies that the following 

supplies are Free Trade Agreement country 

end products other than Bahraini end 

products, Korean end products, Moroccan 

end products, Panamanian end products, or 

Peruvian end products: 

Line item No. Country of origin 

(iii) The following supplies are other 

foreign end products, including end products 

manufactured in the United States that do 

not qualify as domestic end products. For 

those foreign end products that do not 

consist wholly or predominantly of iron or 

steel or a combination of both, the Offeror 

shall also indicate whether these foreign end 

products exceed 55 percent domestic 

content, except those that are COTS items. If 

the percentage of the domestic content is 

unknown, select ‘‘no’’. 

Line item No. Country of origin 

(if known) 

Exceeds 55% domestic content 

(yes/no) 

(3) The Offeror shall list the line item 

numbers of domestic end products that 

contain a critical component or a critical item 

(see section 25.105 of the Federal Acquisition 

Regulation). 

Line Item Number: llllllllllll

[List as necessary] 

* * * * * 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate V (Feb 2024) 

* * * * * 

(c) Certifications and identification of 

country of origin. 

(1) For all line items subject to the Buy 

American—Free Trade Agreements—Balance 

of Payments Program—Alternate V clause of 

this solicitation, the Offeror certifies that— 

(i) Each end product, except the end 

products listed in paragraph (c)(2) of this 

provision, is a domestic end product; 

(ii) Each domestic end product listed in 

paragraph (c)(3) of this provision contains a 

critical component or a critical item; and 

(iii) Components of unknown origin are 

considered to have been mined, produced, or 

manufactured outside the United States or a 

qualifying country. 

(2) The Offeror shall identify all end 

products that are not domestic end products. 

(i) The Offeror certifies that the following 

supplies are qualifying country (except 

Australian) or SC/CASA state end products: 

Line item No. Country of origin 

(ii) The Offeror certifies that the following 

supplies are Free Trade Agreement country 

end products other than Bahraini end 

products, Korean end products, Moroccan 

end products, Panamanian end products, or 

Peruvian end products: 

Line item No. Country of origin 

(iii) The following supplies are other 

foreign end products, including end products 

manufactured in the United States that do 

not qualify as domestic end products. For 

those foreign end products that do not 

consist wholly or predominantly of iron or 

steel or a combination of both, the Offeror 

shall also indicate whether these foreign end 

products exceed 55 percent domestic 

content, except those that are COTS items. If 

the percentage of the domestic content is 

unknown, select ‘‘no’’. 


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11966 Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Rules and Regulations 

Line item No. Country of origin 

(if known) 

Exceeds 55% domestic content 

(yes/no) 

(3) The Offeror shall list the line item 

numbers of domestic end products that 

contain a critical component or a critical item 

(see section 25.105 of the Federal Acquisition 

Regulation). 

Line Item Number: llllllllllll

[List as necessary] 

* * * * * 

■ 16. Revise and republish section 

252.225–7036 to read as follows: 

252.225–7036 Buy American—Free Trade 

Agreements—Balance of Payments 

Program. 

252.225–7036 Buy American—Free Trade 

Agreements—Balance of Payments 

Program. 

Basic. As prescribed in 

225.1101(10)(i) and (10)(i)(A), use the 

following clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Basic (Feb 

2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

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 Defense Federal 

Acquisition Regulation Supplement (DFARS) 

225.101(d); or award is made before January 

1, 2030, for a foreign end product that 

exceeds 55 percent domestic content (see 

DFARS 225.103(b)(ii)). The cost of 

components includes transportation costs to 

the place of incorporation into the end 

product and U.S. duty (whether or not a 

duty-free entry certificate is issued). 

Components of unknown origin are treated as 

foreign. Scrap generated, collected, and 

prepared for processing in the United States 

is considered domestic. A component is 

considered to have been mined, produced, or 

manufactured in the United States (regardless 

of its source in fact) if the end product in 

which it is incorporated is manufactured in 

the United States and the component is of a 

class or kind for which the Government has 

determined that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 


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calculating the value of the end product 

includes services (except transportation 

services) incidental to its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components 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: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, Free Trade Agreement 

country end products other than Bahraini 

end products, Moroccan end products, 

Panamanian end products, or Peruvian end 

products, or other foreign end products in the 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Basic provision of the solicitation. If the 

Contractor certified in its offer that it will 

deliver a qualifying country end product or 

a Free Trade Agreement country end product 

other than a Bahraini end product, a 

Moroccan end product, a Panamanian end 

product, or a Peruvian end product, the 

Contractor shall deliver a qualifying country 

end product, a Free Trade Agreement country 

end product other than a Bahraini end 

product, a Moroccan end product, a 

Panamanian end product, or a Peruvian end 

product, or, at the Contractor’s option, a 

domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate I. As prescribed in 

225.1101(10)(i) and (10)(i)(B), use the 

following clause, which uses a different 

paragraph (c) than the basic clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate I 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of commercial 

product in section 2.101 of the Federal 

Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 


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(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

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 Defense Federal 

Acquisition Regulation Supplement (DFARS) 

225.101(d); or award is made before January 

1, 2030, for a foreign end product that 

exceeds 55 percent domestic content (see 

DFARS 225.103(b)(ii)). The cost of 

components includes transportation costs to 

the place of incorporation into the end 

product and U.S. duty (whether or not a 

duty-free entry certificate is issued). 

Components of unknown origin are treated as 

foreign. Scrap generated, collected, and 

prepared for processing in the United States 

is considered domestic. A component is 

considered to have been mined, produced, or 

manufactured in the United States (regardless 

of its source in fact) if the end product in 

which it is incorporated is manufactured in 

the United States and the component is of a 

class or kind for which the Government has 

determined that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components 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 


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percent for items delivered starting in 

calendar year 2029, unless an alternate 

percentage is established for a contract: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country, or other foreign end products in the 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate I provision of the solicitation. If the 

Contractor certified in its offer that it will 

deliver a qualifying country end product, the 

Contractor shall deliver a qualifying country 

end product or, at the Contractor’s option, a 

domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate II. As prescribed in 

225.1101(10)(i) and (10)(i)(C), use the 

following clause, which adds South 

Caucasus/Central and South Asian (SC/ 

CASA) state and South Caucasus/ 

Central and South Asian (SC/CASA) 

state end product to paragraph (a), and 

uses a different paragraph (c) than the 

basic clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate II 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of commercial 

product in section 2.101 of the Federal 

Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

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 Defense Federal 

Acquisition Regulation Supplement (DFARS) 

225.101(d); or award is made before January 

1, 2030, for a foreign end product that 

exceeds 55 percent domestic content (see 

DFARS 225.103(b)(ii)). The cost of 

components includes transportation costs to 

the place of incorporation into the end 

product and U.S. duty (whether or not a 

duty-free entry certificate is issued). 

Components of unknown origin are treated as 

foreign. Scrap generated, collected, and 

prepared for processing in the United States 

is considered domestic. A component is 

considered to have been mined, produced, or 

manufactured in the United States (regardless 

of its source in fact) if the end product in 

which it is incorporated is manufactured in 

the United States and the component is of a 

class or kind for which the Government has 

determined that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 


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services) incidental to its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components 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: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

South Caucasus/Central and South Asian 

(SC/CASA) state end product means an 

article that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; 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 SC/CASA state 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, SC/CASA state end 

products, Free Trade Agreement country end 

products other than Bahraini end products, 

Moroccan end products, Panamanian end 

products, or Peruvian end products, or other 

foreign end products in the Buy American— 

Free Trade Agreements—Balance of 

Payments Program Certificate—Alternate II 

provision of the solicitation. If the Contractor 

certified in its offer that it will deliver a 

qualifying country end product, SC/CASA 

state end products, or a Free Trade 

Agreement country end product other than a 

Bahraini end product, a Moroccan end 

product, a Panamanian end product, or a 

Peruvian end product, the Contractor shall 

deliver a qualifying country end product, an 

SC/CASA state end product, a Free Trade 

Agreement country end product other than a 

Bahraini end product, a Moroccan end 

product, a Panamanian end product, or a 

Peruvian end product or, at the Contractor’s 

option, a domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate III. As prescribed in 

225.1101(10)(i) and (10)(i)(D), use the 

following clause, which adds South 

Caucasus/Central and South Asian (SC/ 

CASA) state and South Caucasus/ 

Central and South Asian (SC/CASA) 

state end product to paragraph (a) and 

uses a different paragraph (c) than the 

basic clause: 

Buy American—Free Trade Agreements— 

Balance Of Payments Program—Alternate III 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of commercial 


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product in section 2.101 of the Federal 

Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

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 Defense Federal 

Acquisition Regulation Supplement (DFARS) 

225.101(d); or award is made before January 

1, 2030, for a foreign end product that 

exceeds 55 percent domestic content (see 

DFARS 225.103(b)(ii)). The cost of 

components includes transportation costs to 

the place of incorporation into the end 

product and U.S. duty (whether or not a 

duty-free entry certificate is issued). 

Components of unknown origin are treated as 

foreign. Scrap generated, collected, and 

prepared for processing in the United States 

is considered domestic. A component is 

considered to have been mined, produced, or 

manufactured in the United States (regardless 

of its source in fact) if the end product in 

which it is incorporated is manufactured in 

the United States and the component is of a 

class or kind for which the Government has 

determined that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron and steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 


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Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components 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: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

South Caucasus/Central and South Asian 

(SC/CASA) state end product means an 

article that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; 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 SC/CASA state 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, SC/CASA state end 

products, or other foreign end products in the 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate III provision of the solicitation. If 

the Contractor certified in its offer that it will 

deliver a qualifying country end product or 

SC/CASA state end products, the Contractor 

shall deliver a qualifying country end 

product, an SC/CASA state end product, or, 

at the Contractor’s option, a domestic end 

product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate IV. As prescribed in 

225.1101(10)(i) and (10)(i)(E), use the 

following clause, which adds Korean 

end product to paragraph (a), and uses 

a different paragraph (c) than the basic 

clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate IV 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of commercial 

product in section 2.101 of the Federal 

Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

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 Defense Federal 

Acquisition Regulation Supplement (DFARS) 

225.101(d); or award is made before January 

1, 2030, for a foreign end product that 

exceeds 55 percent domestic content (see 

DFARS 225.103(b)(ii)). The cost of 

components includes transportation costs to 

the place of incorporation into the end 

product and U.S. duty (whether or not a 

duty-free entry certificate is issued). 

Components of unknown origin are treated as 

foreign. Scrap generated, collected, and 

prepared for processing in the United States 

is considered domestic. A component is 

considered to have been mined, produced, or 

manufactured in the United States (regardless 

of its source in fact) if the end product in 

which it is incorporated is manufactured in 

the United States and the component is of a 

class or kind for which the Government has 

determined that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, excluding 


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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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Korean end product means an article that— 

(1) Is wholly the growth, product, or 

manufacture of Korea; 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 Korea (Republic of) 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components 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: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, Free Trade Agreement 

country end products other than Bahraini 

end products, Korean end products, 

Moroccan end products, Panamanian end 

products, or Peruvian end products, or other 

foreign end products in the Buy American— 

Free Trade Agreements—Balance of 

Payments Program Certificate—Alternate IV 

provision of the solicitation. If the Contractor 

certified in its offer that it will deliver a 

qualifying country end product or a Free 

Trade Agreement country end product other 

than a Bahraini end product, a Korean end 

product, a Moroccan end product, a 

Panamanian end product, or a Peruvian end 

product, the Contractor shall deliver a 

qualifying country end product, a Free Trade 

Agreement country end product other than a 

Bahraini end product, a Korean end product, 

a Moroccan end product, a Panamanian end 

product, or a Peruvian end product, or, at the 

Contractor’s option, a domestic end product. 

(d) The contract price does not include 

duty for end products or components for 


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which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate V. As prescribed in 

225.1101(10)(i) and (10)(i)(F), use the 

following clause, which adds Korean 

end product, South Caucasus/Central 

and South Asian (SC/CASA) state, and 

South Caucasus/Central and South 

Asian (SC/CASA) state end product to 

paragraph (a), and uses a different 

paragraph (c) than the basic clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate V 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of commercial 

product in section 2.101 of the Federal 

Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

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 Defense Federal 

Acquisition Regulation Supplement (DFARS) 

225.101(d); or award is made before January 

1, 2030, for a foreign end product that 

exceeds 55 percent domestic content (see 

DFARS 225.103(b)(ii)). The cost of 

components includes transportation costs to 

the place of incorporation into the end 

product and U.S. duty (whether or not a 

duty-free entry certificate is issued). 

Components of unknown origin are treated as 

foreign. Scrap generated, collected, and 

prepared for processing in the United States 

is considered domestic. A component is 

considered to have been mined, produced, or 

manufactured in the United States (regardless 

of its source in fact) if the end product in 

which it is incorporated is manufactured in 

the United States and the component is of a 

class or kind for which the Government has 

determined that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Korean end product means an article that— 

(1) Is wholly the growth, product, or 

manufacture of Korea; 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 Korea (Republic of) 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 


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services) incidental to its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components 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: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

South Caucasus/Central and South Asian 

(SC/CASA) state end product means an 

article that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; 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 SC/CASA state 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, SC/CASA state end 

products, Free Trade Agreement country end 

products other than Bahraini end products, 

Korean end products, Moroccan end 

products, Panamanian end products, or 

Peruvian end products, or other foreign end 

products in the Buy American—Free Trade 

Agreements—Balance of Payments Program 

Certificate—Alternate V provision of the 

solicitation. If the Contractor certified in its 

offer that it will deliver a qualifying country 

end product, SC/CASA state end products, or 

a Free Trade Agreement country end product 

other than a Bahraini end product, a Korean 

end product, a Moroccan end product, a 

Panamanian end product, or a Peruvian end 

product, the Contractor shall deliver a 

qualifying country end product, an SC/CASA 

state end product, a Free Trade Agreement 

country end product other than a Bahraini 

end product, a Korean end product, a 

Moroccan end product, a Panamanian end 

product, or a Peruvian end product or, at the 

Contractor’s option, a domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate VI. As prescribed in 

225.1101(10)(i) and (10)(i)(G), use the 

following clause, which includes, in the 

definitions of ‘‘domestic end product’’ 

at paragraph (1)(ii)(A) and ‘‘qualifying 

country end product’’ at paragraph 

(2)(i), the domestic content threshold 

that will apply to the entire contract 

period of performance: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate VI 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 


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Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

mined, produced, or manufactured in the 

United States exceeds, for the entire period 

of performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

The cost of components includes 

transportation costs to the place of 

incorporation into the end product and U.S. 

duty (whether or not a duty-free entry 

certificate is issued). Components of 

unknown origin are treated as foreign. Scrap 

generated, collected, and prepared for 

processing in the United States is considered 

domestic. A component is considered to have 

been mined, produced, or manufactured in 

the United States (regardless of its source in 

fact) if the end product in which it is 

incorporated is manufactured in the United 

States and the component is of a class or kind 

for which the Government has determined 

that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 


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performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, Free Trade Agreement 

country end products other than Bahraini 

end products, Moroccan end products, 

Panamanian end products, or Peruvian end 

products, or other foreign end products in the 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Basic provision of the solicitation. If the 

Contractor certified in its offer that it will 

deliver a qualifying country end product or 

a Free Trade Agreement country end product 

other than a Bahraini end product, a 

Moroccan end product, a Panamanian end 

product, or a Peruvian end product, the 

Contractor shall deliver a qualifying country 

end product, a Free Trade Agreement country 

end product other than a Bahraini end 

product, a Moroccan end product, a 

Panamanian end product, or a Peruvian end 

product, or, at the Contractor’s option, a 

domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate VII. As prescribed in 

225.1101(10)(i) and (10)(i)(H), use the 

following clause, which includes, in the 

definitions of ‘‘domestic end product’’ 

at paragraph (1)(ii)(A) and ‘‘qualifying 

country end product’’ at paragraph 

(2)(i), the domestic content threshold 

that will apply to the entire contract 

period of performance and uses a 

different paragraph (c) than the basic 

clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate 

VII (Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

mined, produced, or manufactured in the 

United States exceeds, for the entire period 

of performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

The cost of components includes 

transportation costs to the place of 

incorporation into the end product and U.S. 

duty (whether or not a duty-free entry 

certificate is issued). Components of 

unknown origin are treated as foreign. Scrap 

generated, collected, and prepared for 

processing in the United States is considered 

domestic. A component is considered to have 

been mined, produced, or manufactured in 

the United States (regardless of its source in 

fact) if the end product in which it is 

incorporated is manufactured in the United 

States and the component is of a class or kind 

for which the Government has determined 

that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; or 


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(2) In the case of an article that consists in 

whole or in part of materials from another 

country, has been substantially transformed 

in Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country or other foreign end products in the 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate I provision of the solicitation. If the 

Contractor certified in its offer that it will 

deliver a qualifying country end product, the 

Contractor shall deliver a qualifying country 

end product or, at the Contractor’s option, a 

domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate VIII. As prescribed in 

225.1101(10)(i) and (10)(i)(I), use the 

following clause, which includes, in the 

definitions of ‘‘domestic end product’’ 

at paragraph (1)(ii)(A) and ‘‘qualifying 

country end product’’ at paragraph 

(2)(i), the domestic content threshold 

that will apply to the entire contract 

period of performance; adds ‘‘South 

Caucasus/Central and South Asian (SC/ 

CASA) state’’ and ‘‘South Caucasus/ 

Central and South Asian (SC/CASA) 

state end product’’ to paragraph (a); and 

uses a different paragraph (c) than the 

basic clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate 

VIII (Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 


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deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

mined, produced, or manufactured in the 

United States exceeds, for the entire period 

of performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

The cost of components includes 

transportation costs to the place of 

incorporation into the end product and U.S. 

duty (whether or not a duty-free entry 

certificate is issued). Components of 

unknown origin are treated as foreign. Scrap 

generated, collected, and prepared for 

processing in the United States is considered 

domestic. A component is considered to have 

been mined, produced, or manufactured in 

the United States (regardless of its source in 

fact) if the end product in which it is 

incorporated is manufactured in the United 

States and the component is of a class or kind 

for which the Government has determined 

that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 


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performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

South Caucasus/Central and South Asian 

(SC/CASA) state end product means an 

article that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; 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 SC/CASA state 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, SC/CASA state end 

products, Free Trade Agreement country end 

products other than Bahraini end products, 

Moroccan end products, Panamanian end 

products, or Peruvian end products, or other 

foreign end products in the Buy American— 

Free Trade Agreements—Balance of 

Payments Program Certificate—Alternate II 

provision of the solicitation. If the Contractor 

certified in its offer that it will deliver a 

qualifying country end product, SC/CASA 

state end products, or a Free Trade 

Agreement country end product other than a 

Bahraini end product, a Moroccan end 

product, a Panamanian end product, or a 

Peruvian end product, the Contractor shall 

deliver a qualifying country end product, an 

SC/CASA state end product, a Free Trade 

Agreement country end product other than a 

Bahraini end product, a Moroccan end 

product, a Panamanian end product, or a 

Peruvian end product or, at the Contractor’s 

option, a domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate IX. As prescribed in 

225.1101(10)(i) and (10)(i)(J), use the 

following clause, which includes in the 

definitions of ‘‘domestic end product’’ 

at paragraph (1)(ii)(A) and ‘‘qualifying 

country end product’’ at paragraph (2)(i) 

the domestic content threshold that will 

apply to the entire contract period of 

performance; adds ‘‘South Caucasus/ 

Central and South Asian (SC/CASA) 

state’’ and ‘‘South Caucasus/Central and 

South Asian (SC/CASA) state end 

product’’ to paragraph (a); and uses a 

different paragraph (c) than the basic 

clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate IX 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

mined, produced, or manufactured in the 

United States exceeds, for the entire period 

of performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

The cost of components includes 

transportation costs to the place of 

incorporation into the end product and U.S. 

duty (whether or not a duty-free entry 

certificate is issued). Components of 

unknown origin are treated as foreign. Scrap 

generated, collected, and prepared for 

processing in the United States is considered 

domestic. A component is considered to have 

been mined, produced, or manufactured in 

the United States (regardless of its source in 

fact) if the end product in which it is 

incorporated is manufactured in the United 

States and the component is of a class or kind 

for which the Government has determined 

that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron and steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 


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Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

South Caucasus/Central and South Asian 

(SC/CASA) state end product means an 

article that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; 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 SC/CASA state 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, SC/CASA state end 

products, or other foreign end products in the 

Buy American—Free Trade Agreements— 

Balance of Payments Program Certificate— 

Alternate III provision of the solicitation. If 

the Contractor certified in its offer that it will 

deliver a qualifying country end product or 

SC/CASA state end products, the Contractor 

shall deliver a qualifying country end 

product, an SC/CASA state end product, or, 

at the Contractor’s option, a domestic end 

product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate X. As prescribed in 

225.1101(10)(i) and (10)(i)(K), use the 

following clause, which includes, in the 

definitions of ‘‘domestic end product’’ 

at paragraph (1)(ii)(A) and ‘‘qualifying 

country end product’’ at paragraph 

(2)(i), the domestic content threshold 


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that will apply to the entire contract 

period of performance; adds ‘‘Korean 

end product’’ to paragraph (a); and uses 

a different paragraph (c) than the basic 

clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate X 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

mined, produced, or manufactured in the 

United States exceeds, for the entire period 

of performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

The cost of components includes 

transportation costs to the place of 

incorporation into the end product and U.S. 

duty (whether or not a duty-free entry 

certificate is issued). Components of 

unknown origin are treated as foreign. Scrap 

generated, collected, and prepared for 

processing in the United States is considered 

domestic. A component is considered to have 

been mined, produced, or manufactured in 

the United States (regardless of its source in 

fact) if the end product in which it is 

incorporated is manufactured in the United 

States and the component is of a class or kind 

for which the Government has determined 

that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Korean end product means an article that— 

(1) Is wholly the growth, product, or 

manufacture of Korea; 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 Korea (Republic of) 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru into a new and different article of 

commerce with a name, character, or use 


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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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 

satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, Free Trade Agreement 

country end products other than Bahraini 

end products, Korean end products, 

Moroccan end products, Panamanian end 

products, or Peruvian end products, or other 

foreign end products in the Buy American— 

Free Trade Agreements—Balance of 

Payments Program Certificate—Alternate IV 

provision of the solicitation. If the Contractor 

certified in its offer that it will deliver a 

qualifying country end product or a Free 

Trade Agreement country end product other 

than a Bahraini end product, a Korean end 

product, a Moroccan end product, a 

Panamanian end product, or a Peruvian end 

product, the Contractor shall deliver a 

qualifying country end product, a Free Trade 

Agreement country end product other than a 

Bahraini end product, a Korean end product, 

a Moroccan end product, a Panamanian end 

product, or a Peruvian end product, or, at the 

Contractor’s option, a domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

Alternate XI. As prescribed in 

225.1101(10)(i) and (10)(i)(L), use the 

following clause, which includes, in the 

definitions of ‘‘domestic end product’’ 

at paragraph (1)(ii)(A) and ‘‘qualifying 

country end product’’ at paragraph 

(2)(i), the domestic content threshold 

that will apply to the entire contract 

period of performance; adds ‘‘Korean 

end product,’’ ‘‘South Caucasus/Central 

and South Asian (SC/CASA) state,’’ and 

‘‘South Caucasus/Central and South 

Asian (SC/CASA) state end product’’ to 

paragraph (a); and uses a different 

paragraph (c) than the basic clause: 

Buy American—Free Trade Agreements— 

Balance of Payments Program—Alternate XI 

(Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain; 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 Bahrain 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means an article, material, or 

supply incorporated directly into an 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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

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; or 

(ii) An end product manufactured in the 

United States if— 

(A) The cost of its qualifying country 

components and its components that are 

mined, produced, or manufactured in the 

United States exceeds, for the entire period 

of performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

The cost of components includes 

transportation costs to the place of 

incorporation into the end product and U.S. 

duty (whether or not a duty-free entry 

certificate is issued). Components of 

unknown origin are treated as foreign. Scrap 

generated, collected, and prepared for 

processing in the United States is considered 

domestic. A component is considered to have 

been mined, produced, or manufactured in 


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the United States (regardless of its source in 

fact) if the end product in which it is 

incorporated is manufactured in the United 

States and the component is of a class or kind 

for which the Government has determined 

that— 

(1) Sufficient and reasonably available 

commercial quantities of a satisfactory 

quality are not mined, produced, or 

manufactured in the United States; or 

(2) It is inconsistent with the public 

interest to apply the restrictions of the Buy 

American statute; 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 iron and steel not produced in the United 

States or a qualifying country constitutes less 

than 5 percent of the cost of all the 

components used in the end product 

(produced in the United States or a 

qualifying country means that all 

manufacturing processes of the iron or steel 

must take place in the United States or a 

qualifying country, except metallurgical 

processes involving refinement of steel 

additives). The cost of iron and steel not 

produced in the United States or a qualifying 

country includes but is not limited to the cost 

of iron or steel mill products (such as bar, 

billet, slab, wire, plate, or sheet), castings, or 

forgings, not produced in the United States 

or a qualifying country, utilized in the 

manufacture of the end product and a good 

faith estimate of the cost of all iron or steel 

components not produced in the United 

States or a qualifying country, 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 

explanation of cost of components in 

paragraph (1)(ii)(A) of this definition. 

End product means those articles, 

materials, and supplies to be acquired under 

this contract for public use. 

Foreign end product means an end product 

other than a domestic end product. 

Free Trade Agreement country means 

Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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 

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 Free Trade Agreement 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Korean end product means an article that— 

(1) Is wholly the growth, product, or 

manufacture of Korea; 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 Korea (Republic of) 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 its 

supply, provided that the value of those 

incidental services does not exceed the value 

of the product itself. 

Moroccan end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Morocco; 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 Morocco 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Panamanian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Panama; 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 Panama 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

Peruvian end product means an article 

that— 

(1) Is wholly the growth, product, or 

manufacture of Peru; 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 Peru 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

Qualifying country means a country with a 

reciprocal defense procurement 

memorandum of understanding or 

international agreement with the United 

States in which both countries agree to 

remove barriers to purchases of supplies 

produced in the other country or services 

performed by sources of the other country, 

and the memorandum or agreement 

complies, where applicable, with the 

requirements of section 36 of the Arms 

Export Control Act (22 U.S.C. 2776) and with 

10 U.S.C. 2457. Accordingly, the following 

are qualifying countries: 

Australia 

Austria 

Belgium 

Canada 

Czech Republic 

Denmark 

Egypt 

Estonia 

Finland 

France 

Germany 

Greece 

Israel 

Italy 

Japan 

Latvia 

Lithuania 

Luxembourg 

Netherlands 

Norway 

Poland 

Portugal 

Slovenia 

Spain 

Sweden 

Switzerland 

Turkey 

United Kingdom of Great Britain and 

Northern Ireland. 

Qualifying country component means a 

component mined, produced, or 

manufactured in a qualifying country. 

Qualifying country end product means— 

(1) An unmanufactured end product mined 

or produced in a qualifying country; or 

(2) An end product manufactured in a 

qualifying country if— 

(i) The cost of the following types of 

components exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components: 

(A) Components mined, produced, or 

manufactured in a qualifying country. 

(B) Components mined, produced, or 

manufactured in the United States. 

(C) Components of foreign origin of a class 

or kind for which the Government has 

determined that sufficient and reasonably 

available commercial quantities of a 


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satisfactory quality are not mined, produced, 

or manufactured in the United States. 

Components of unknown origin are treated as 

foreign; or 

(ii) The end product is a COTS item. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

South Caucasus/Central and South Asian 

(SC/CASA) state end product means an 

article that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; 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 SC/CASA state 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 its supply, provided 

that the value of those incidental services 

does not exceed the value of the product 

itself. 

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. 

(b) Unless otherwise specified, this clause 

applies to all items in the Schedule. 

(c) The Contractor shall deliver under this 

contract only domestic end products unless, 

in its offer, it specified delivery of qualifying 

country end products, SC/CASA state end 

products, Free Trade Agreement country end 

products other than Bahraini end products, 

Korean end products, Moroccan end 

products, Panamanian end products, or 

Peruvian end products, or other foreign end 

products in the Buy American—Free Trade 

Agreements—Balance of Payments Program 

Certificate—Alternate V provision of the 

solicitation. If the Contractor certified in its 

offer that it will deliver a qualifying country 

end product, SC/CASA state end products, or 

a Free Trade Agreement country end product 

other than a Bahraini end product, a Korean 

end product, a Moroccan end product, a 

Panamanian end product, or a Peruvian end 

product, the Contractor shall deliver a 

qualifying country end product, an SC/CASA 

state end product, a Free Trade Agreement 

country end product other than a Bahraini 

end product, a Korean end product, a 

Moroccan end product, a Panamanian end 

product, or a Peruvian end product or, at the 

Contractor’s option, a domestic end product. 

(d) The contract price does not include 

duty for end products or components for 

which the Contractor will claim duty-free 

entry. 

(End of clause) 

■ 17. Amend section 252.225–7044— 

■ a. In Alternate I— 

■ i. By revising the clause title and date; 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

available off-the-shelf (COTS) item’’ in 

paragraph (1)(i) by removing ‘‘Federal 

Acquisition Regulation’’ and adding 

‘‘Federal Acquisition Regulation (FAR)’’ 

in its place; 

■ B. By adding, in alphabetical order, 

the definitions of ‘‘Critical component’’ 

and ‘‘Critical item’’; 

■ C. In the definition of ‘‘Domestic 

construction material’’ by revising the 

first sentence of paragraph (1)(ii)(A); 

and 

■ b. In the Basic clause: 

■ i. By revising the clause title and date; 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

available off-the-shelf (COTS) item’’ in 

paragraph (1)(i) by removing ‘‘Federal 

Acquisition Regulation’’ and adding 

‘‘Federal Acquisition Regulation (FAR)’’ 

in its place; 

■ B. By adding, in alphabetical order, 

the definitions of ‘‘Critical component’’ 

and ‘‘Critical item’’; 

■ C. In the definition of ‘‘Domestic 

construction material’’ by revising the 

first sentence of paragraph (1)(ii)(A); 

■ c. By adding Alternates II and III. 

The revisions and additions read as 

follows: 

252.225–7044 Balance of Payments 

Program—Construction Material. 

* * * * * 

Balance of Payments Program—Construction 

Material—Basic (Feb 2024) 

(a) * * * 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

Domestic construction material means— 

(1) * * * 

(ii) * * * 

(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 25.201(c). * * * 

* * * * * 

Alternate I. * * * 

Balance of Payments Program—Construction 

Material—Alternate I (Feb 2024) 

(a) * * * 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

Domestic construction material means— 

(1) * * * 

(ii) * * * 

(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 25.201(c). * * * 

* * * * * 

Alternate II. As prescribed in 225.7503(a) 

and (a)(3), use the following clause, which 

includes, in the definition of ‘‘domestic 

construction material’’ at paragraph (1)(ii)(A), 

the domestic content threshold that will 

apply to the entire contract period of 

performance: 

Balance of Payments Program—Construction 

Material—Alternate II (Feb 2024) 

(a) Definitions. As used in this clause— 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means any article, material, or 

supply incorporated directly into 

construction material. 

Construction material means an article, 

material, or supply brought to the 

construction site by the Contractor or a 

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 (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 


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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 construction material. 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

Domestic construction material means— 

(1) For construction material that does not 

consist wholly or predominantly of iron or 

steel or a combination of both— 

(i) An unmanufactured construction 

material mined or produced in the United 

States; or 

(ii) A construction material manufactured 

in the United States, if— 

(A) The cost of its components mined, 

produced, or manufactured in the United 

States exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

Components of foreign origin of the same 

class or kind for which nonavailability 

determinations have been made are treated as 

domestic. Components of unknown origin are 

treated as foreign; or 

(B) The construction material is a COTS 

item; or 

(2) 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 iron and steel not produced in the 

United States (excluding fasteners) as 

estimated in good faith by the contractor, 

constitutes less than 5 percent of the cost of 

all the components used in such construction 

material (produced in the United States 

means that all manufacturing processes of the 

iron or steel must take place in the United 

States, except metallurgical processes 

involving refinement of steel additives). The 

cost of iron and steel not produced in the 

United States includes but is not limited to 

the cost of iron or steel mill products (such 

as bar, billet, slab, wire, plate, or sheet), 

castings, or forgings, not produced in the 

United States, utilized in the manufacture of 

the end product and a good faith estimate of 

the cost of all iron or steel components not 

produced in the United States, 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 clause. 

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. 

(b) Domestic preference. This clause 

implements the Balance of Payments 

Program by providing a preference for 

domestic construction material. The 

Contractor shall use only domestic 

construction material in performing this 

contract, except for— 

(1) Construction material valued at or 

below the simplified acquisition threshold in 

FAR part 2; 

(2) Information technology that is a 

commercial product; or 

(3) The construction material or 

components listed by the Government as 

follows: 

[Contracting Officer to list applicable 

excepted materials or indicate ‘‘none’’]. 

(End of clause) 

Alternate III. As prescribed in 

225.7503(a) and (a)(4), use the following 

clause, which includes, in the definition 

of ‘‘domestic construction material’’ at 

paragraph (1)(ii)(A), the domestic 

content threshold that will apply to the 

entire period of performance; adds 

definitions for ‘‘South Caucasus/Central 

and South Asian (SC/CASA) state’’ and 

‘‘SC/CASA state construction material’’ 

to paragraph (a); and uses ‘‘domestic 

construction material or SC/CASA state 

construction material’’ instead of 

‘‘domestic construction material’’ in the 

second sentence of paragraph (b): 

Balance of Payments Program—Construction 

Material—Alternate III (Feb 2024) 

(a) Definitions. As used in this clause— 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in 46 U.S.C. 40102(4), such as agricultural 

products and petroleum products. 

Component means any article, material, or 

supply incorporated directly into 

construction material. 

Construction material means an article, 

material, or supply brought to the 

construction site by the Contractor or a 

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 (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 construction material. 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

Domestic construction material means— 

(1) For construction material that does not 

consist wholly or predominantly of iron or 

steel or a combination of both— 

(i) An unmanufactured construction 

material mined or produced in the United 

States; or 

(ii) A construction material manufactured 

in the United States, if— 

(A) The cost of its components mined, 

produced, or manufactured in the United 

States exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

Components of foreign origin of the same 

class or kind for which nonavailability 

determinations have been made are treated as 

domestic. Components of unknown origin are 

treated as foreign; or 

(B) The construction material is a COTS 

item; or 

(2) 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 iron and steel not produced in the 

United States (excluding fasteners) as 

estimated in good faith by the contractor, 

constitutes less than 5 percent of the cost of 

all the components used in such construction 

material (produced in the United States 

means that all manufacturing processes of the 

iron or steel must take place in the United 

States, except metallurgical processes 

involving refinement of steel additives). The 


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cost of iron and steel not produced in the 

United States includes but is not limited to 

the cost of iron or steel mill products (such 

as bar, billet, slab, wire, plate, or sheet), 

castings, or forgings, not produced in the 

United States, utilized in the manufacture of 

the construction material and a good faith 

estimate of the cost of all iron or steel 

components not produced in the United 

States, 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 

clause. 

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. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

SC/CASA state construction material 

means construction material that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 

transformed in an SC/CASA state into a new 

and different construction material distinct 

from the material from which it was 

transformed. 

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. 

(b) Domestic preference. This clause 

implements the Balance of Payments 

Program by providing a preference for 

domestic construction material. The 

Contractor shall use only domestic 

construction material or SC/CASA state 

construction material in performing this 

contract, except for— 

(1) Construction material valued at or 

below the simplified acquisition threshold in 

FAR part 2; 

(2) Information technology that is a 

commercial product; or 

(3) The construction material or 

components listed by the Government as 

follows: 

[Contracting Officer to list applicable 

excepted materials or indicate ‘‘none’’]. 

(End of clause) 

■ 18. Amend section 252.225–7045— 

■ a. In the Basic clause: 

■ i. By revising the clause date; 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

available off-the-shelf (COTS) item’’ in 

paragraph (1)(i) by removing ‘‘Federal 

Acquisition Regulation’’ and adding 

‘‘Federal Acquisition Regulation (FAR)’’ 

in its place; 

■ B. By adding, in alphabetical order, 

the definitions of ‘‘Critical component’’ 

and ‘‘Critical item’’; 

■ C. In the definition of ‘‘Domestic 

construction material’’ by revising the 

first sentence of paragraph (1)(ii)(A); 

■ b. In Alternate I— 

■ i. By revising the clause date; 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

available off-the-shelf (COTS) item’’ in 

paragraph (1)(i) by removing ‘‘Federal 

Acquisition Regulation’’ and adding 

‘‘Federal Acquisition Regulation (FAR)’’ 

in its place; 

■ B. By adding, in alphabetical order, 

the definitions of ‘‘Critical component’’ 

and ‘‘Critical item’’; 

■ C. In the definition of ‘‘Domestic 

construction material’’ by revising the 

first sentence of paragraph (1)(ii)(A); 

■ c. In Alternate II— 

■ i. By revising the clause date; 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

available off-the-shelf (COTS) item’’ in 

paragraph (1)(i) by removing ‘‘Federal 

Acquisition Regulation’’ and adding 

‘‘Federal Acquisition Regulation (FAR)’’ 

in its place; 

■ B. By adding, in alphabetical order, 

the definitions of ‘‘Critical component’’ 

and ‘‘Critical item’’; 

■ C. In the definition of ‘‘Domestic 

construction material’’ by revising the 

first sentence of paragraph (1)(ii)(A); 

■ d. In Alternate III— 

■ i. By revising the clause date; 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

available off-the-shelf (COTS) item’’ in 

paragraph (1)(i) by removing ‘‘Federal 

Acquisition Regulation’’ and adding 

‘‘Federal Acquisition Regulation (FAR)’’ 

in its place; 

■ B. By adding, in alphabetical order, 

the definitions of ‘‘Critical component’’ 

and ‘‘Critical item’’; 

■ C. In the definition of ‘‘Domestic 

construction material’’ by revising the 

first sentence of paragraph (1)(ii)(A); 

and 

■ e. By adding Alternates IV through 

VII. 

The revisions and additions read as 

follows: 

252.225–7045 Balance of Payments 

Program—Construction Material Under 

Trade Agreements. 

* * * * * 

Balance of Payments Program—Construction 

Material Under Trade Agreements—Basic 

(Feb 2024) 

(a) * * * 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

* * * * * 

Domestic construction material means— 

(1) * * * 

(ii) * * * 

(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 25.201(c). * * * 

* * * * * 

Alternate I. * * * 

Balance of Payments Program—Construction 

Material Under Trade Agreements— 

Alternate I (Feb 2024) 

(a) * * * 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

* * * * * 

Domestic construction material means— 

(1) * * * 

(ii) * * * 

(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 25.201(c). * * * 

* * * * * 

Alternate II. * * * 

Balance of Payments Program—Construction 

Material Under Trade Agreements— 

Alternate II (Feb 2024) 

(a) * * * 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

* * * * * 

Domestic construction material means— 

(1) * * * 

(ii) * * * 

(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 


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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). * * * 

* * * * * 

Alternate III. * * * 

Balance of Payments Program—Construction 

Material Under Trade Agreements— 

Alternate III (Feb 2024) 

(a) * * * 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

* * * * * 

Domestic construction material means— 

(1) * * * 

(ii) * * * 

(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 25.201(c). * * * 

* * * * * 

Alternate IV. As prescribed in 

225.7503(b) and (b)(5), use the following 

clause, which includes, in the definition 

of ‘‘domestic construction material’’ at 

paragraph (1)(ii)(A), the domestic 

content threshold that will apply to the 

entire contract period of performance: 

Balance of Payments Program—Construction 

Material Under Trade Agreements— 

Alternate IV (Feb 2024) 

(a) Definitions. As used in this clause— 

Caribbean Basin country construction 

material means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a Caribbean Basin country; or 

(2) In the case of a construction material 

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 construction 

material distinct from the materials from 

which it was transformed. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in section 3 of the Shipping Act of 1984 (46 

U.S.C. 40102), such as agricultural products 

and petroleum products. 

Component means any article, material, or 

supply incorporated directly into 

construction material. 

Construction material means an article, 

material, or supply brought to the 

construction site by the Contractor or a 

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 (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 construction material. 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

Designated country means— 

(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 the 

United Kingdom); 

(2) A Free Trade Agreement country 

(Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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, TimorLeste, 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 construction material 

means a construction material that is a WTO 

GPA country construction material, a Free 

Trade Agreement country construction 

material, a least developed country 

construction material, or a Caribbean Basin 

country construction material. 

Domestic construction material means— 

(1) For construction material that does not 

consist wholly or predominantly of iron or 

steel or a combination of both— 

(i) An unmanufactured construction 

material mined or produced in the United 

States; or 

(ii) A construction material manufactured 

in the United States, if— 

(A) The cost of its components mined, 

produced, or manufactured in the United 

States exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

Components of foreign origin of the same 

class or kind for which nonavailability 

determinations have been made are treated as 

domestic. Components of unknown origin are 

treated as foreign; or 

(B) The construction material is a COTS 

item; or 

(2) 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 iron and steel not produced in the 

United States (excluding fasteners) as 

estimated in good faith by the contractor, 

constitutes less than 5 percent of the cost of 

all the components used in such construction 

material (produced in the United States 

means that all manufacturing processes of the 

iron or steel must take place in the United 

States, except metallurgical processes 

involving refinement of steel additives). The 

cost of iron and steel not produced in the 

United States includes but is not limited to 

the cost of iron or steel mill products (such 

as bar, billet, slab, wire, plate, or sheet), 

castings, or forgings, not produced in the 

United States, utilized in the manufacture of 

the construction material and a good faith 

estimate of the cost of all iron or steel 


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components not produced in the United 

States, 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 

clause. 

Free Trade Agreement country 

construction material means a construction 

material that— 

(1) Is wholly the growth, product, or 

manufacture of a Free Trade Agreement 

country; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 

transformed in a Free Trade Agreement 

country into a new and different construction 

material distinct from the material from 

which it was transformed. 

Least developed country construction 

material means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a least developed country; or 

(2) In the case of a construction material 

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 construction material 

distinct from the materials from which it was 

transformed. 

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. 

WTO GPA country construction material 

means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a WTO GPA country; or 

(2) In the case of a construction material 

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 construction material 

distinct from the materials from which it was 

transformed. 

(b) This clause implements the Balance of 

Payments Program by providing a preference 

for domestic construction material. In 

addition, the Contracting Officer has 

determined that the WTO GPA and Free 

Trade Agreements apply to this acquisition. 

Therefore, the Balance of Payments Program 

restrictions are waived for designated 

country construction materials. 

(c) The Contractor shall use only domestic 

or designated country construction material 

in performing this contract, except for— 

(1) Construction material valued at or 

below the simplified acquisition threshold in 

FAR part 2; 

(2) Information technology that is a 

commercial product; or 

(3) The construction material or 

components listed by the Government as 

follows: 

[Contracting Officer to list applicable 

excepted materials or indicate ‘‘none’’]. 

(End of clause) 

Alternate V. As prescribed in 

225.7503(b) and (b)(6), use the following 

clause, which includes, in the definition 

of ‘‘domestic construction material’’ at 

paragraph (1)(ii)(A), the domestic 

content threshold that will apply to the 

entire contract period of performance; 

adds ‘‘Bahraini or Mexican construction 

material’’ to paragraph (a); and uses 

different paragraphs (b) and (c) than the 

basic clause: 

Balance of Payments Program—Construction 

Material Under Trade Agreements— 

Alternate V (Feb 2024) 

(a) Definitions. As used in this clause— 

Bahraini or Mexican construction material 

means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of Bahrain or Mexico; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 

transformed in Bahrain or Mexico into a new 

and different construction material distinct 

from the materials from which it was 

transformed. 

Caribbean Basin country construction 

material means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a Caribbean Basin country; or 

(2) In the case of a construction material 

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 construction 

material distinct from the materials from 

which it was transformed. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in section 3 of the Shipping Act of 1984 (46 

U.S.C. 40102), such as agricultural products 

and petroleum products. 

Component means any article, material, or 

supply incorporated directly into 

construction material. 

Construction material means an article, 

material, or supply brought to the 

construction site by the Contractor or a 

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 (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 construction material. 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

Designated country means— 

(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 the 

United Kingdom); 

(2) A Free Trade Agreement country 

(Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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, TimorLeste, Togo, Tuvalu, Uganda, Vanuatu, 

Yemen, or Zambia); or 

(4) A Caribbean Basin country (Antigua 

and Barbuda, Aruba, Bahamas, Barbados, 


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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 construction material 

means a construction material that is a WTO 

GPA country construction material, a Free 

Trade Agreement country construction 

material, a least developed country 

construction material, or a Caribbean Basin 

country construction material. 

Domestic construction material means— 

(1) For construction material that does not 

consist wholly or predominantly of iron or 

steel or a combination of both— 

(i) An unmanufactured construction 

material mined or produced in the United 

States; or 

(ii) A construction material manufactured 

in the United States, if— 

(A) The cost of its components mined, 

produced, or manufactured in the United 

States exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

Components of foreign origin of the same 

class or kind for which nonavailability 

determinations have been made are treated as 

domestic. Components of unknown origin are 

treated as foreign; or 

(B) The construction material is a COTS 

item; or 

(2) 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 iron and steel not produced in the 

United States (excluding fasteners) as 

estimated in good faith by the contractor, 

constitutes less than 5 percent of the cost of 

all the components used in such construction 

material (produced in the United States 

means that all manufacturing processes of the 

iron or steel must take place in the United 

States, except metallurgical processes 

involving refinement of steel additives). The 

cost of iron and steel not produced in the 

United States includes but is not limited to 

the cost of iron or steel mill products (such 

as bar, billet, slab, wire, plate, or sheet), 

castings, or forgings, not produced in the 

United States, utilized in the manufacture of 

the construction material and a good faith 

estimate of the cost of all iron or steel 

components not produced in the United 

States, 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 

clause. 

Free Trade Agreement country 

construction material means a construction 

material that— 

(1) Is wholly the growth, product, or 

manufacture of a Free Trade Agreement 

country; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 

transformed in a Free Trade Agreement 

country into a new and different construction 

material distinct from the material from 

which it was transformed. 

Least developed country construction 

material means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a least developed country; or 

(2) In the case of a construction material 

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 construction material 

distinct from the materials from which it was 

transformed. 

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. 

WTO GPA country construction material 

means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a WTO GPA country; or 

(2) In the case of a construction material 

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 construction material 

distinct from the materials from which it was 

transformed. 

(b) This clause implements the Balance of 

Payments Program by providing a preference 

for domestic construction material. In 

addition, the Contracting Officer has 

determined that the WTO GPA and all Free 

Trade Agreements except United StatesMexico-Canada Agreement and the Bahrain 

Free Trade Agreement apply to this 

acquisition. Therefore, the Balance of 

Payments Program restrictions are waived for 

designated country construction material 

other than Bahraini or Mexican construction 

material. 

(c) The Contractor shall use only domestic 

or designated country construction material 

other than Bahraini or Mexican construction 

material in performing this contract, except 

for— 

(1) Construction material valued at or 

below the simplified acquisition threshold in 

FAR part 2; or 

(2) Information technology that is a 

commercial product; or 

(3) The construction material or 

components listed by the Government as 

follows: 

[Contracting Officer to list applicable 

excepted materials or indicate ‘‘none’’]. 

(End of clause) 

Alternate VI. As prescribed in 

225.7503(b) and (b)(7), use the following 

clause, which includes, in the definition 

of ‘‘domestic construction material’’ at 

paragraph (1)(ii)(A), the domestic 

content threshold that will apply to the 

entire contract period of performance; 

adds ‘‘South Caucasus/Central and 

South Asian (SC/CASA) state’’ and ‘‘SC/ 

CASA state construction material’’ to 

paragraph (a); uses a different paragraph 

(b) and introductory text for paragraph 

(c) than the basic clause; and adds 

paragraph (d): 

Balance of Payments Program—Construction 

Material Under Trade Agreements— 

Alternate VI (Feb 2024) 

(a) Definitions. As used in this clause— 

Caribbean Basin country construction 

material means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a Caribbean Basin country; or 

(2) In the case of a construction material 

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 construction 

material distinct from the materials from 

which it was transformed. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in section 3 of the Shipping Act of 1984 (46 

U.S.C. 40102), such as agricultural products 

and petroleum products. 

Component means any article, material, or 

supply incorporated directly into 

construction material. 

Construction material means an article, 

material, or supply brought to the 

construction site by the Contractor or a 

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 (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 


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(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 construction material. 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

Designated country means— 

(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 the 

United Kingdom); 

(2) A Free Trade Agreement country 

(Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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, TimorLeste, 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 construction material 

means a construction material that is a WTO 

GPA country construction material, a Free 

Trade Agreement country construction 

material, a least developed country 

construction material, or a Caribbean Basin 

country construction material. 

Domestic construction material means— 

(1) For construction material that does not 

consist wholly or predominantly of iron or 

steel or a combination of both— 

(i) An unmanufactured construction 

material mined or produced in the United 

States; or 

(ii) A construction material manufactured 

in the United States, if— 

(A) The cost of its components mined, 

produced, or manufactured in the United 

States exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

Components of foreign origin of the same 

class or kind for which nonavailability 

determinations have been made are treated as 

domestic. Components of unknown origin are 

treated as foreign; or 

(B) The construction material is a COTS 

item; or 

(2) 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 iron and steel not produced in the 

United States (excluding fasteners) as 

estimated in good faith by the contractor, 

constitutes less than 5 percent of the cost of 

all the components used in such construction 

material (produced in the United States 

means that all manufacturing processes of the 

iron or steel must take place in the United 

States, except metallurgical processes 

involving refinement of steel additives). The 

cost of iron and steel not produced in the 

United States includes but is not limited to 

the cost of iron or steel mill products (such 

as bar, billet, slab, wire, plate, or sheet), 

castings, or forgings, not produced in the 

United States, utilized in the manufacture of 

the construction material and a good faith 

estimate of the cost of all iron or steel 

components not produced in the United 

States, 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 

clause. 

Free Trade Agreement country 

construction material means a construction 

material that— 

(1) Is wholly the growth, product, or 

manufacture of a Free Trade Agreement 

country; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 

transformed in a Free Trade Agreement 

country into a new and different construction 

material distinct from the material from 

which it was transformed. 

Least developed country construction 

material means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a least developed country; or 

(2) In the case of a construction material 

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 construction material 

distinct from the materials from which it was 

transformed. 

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. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

SC/CASA state construction material 

means construction material that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 

transformed in an SC/CASA state into a new 

and different construction material distinct 

from the material from which it was 

transformed. 

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. 

WTO GPA country construction material 

means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a WTO GPA country; or 

(2) In the case of a construction material 

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 construction material 

distinct from the materials from which it was 

transformed. 

(b) This clause implements the Balance of 

Payments Program by providing a preference 

for domestic construction material. In 

addition, the Contracting Officer has 

determined that the WTO GPA, Free Trade 

Agreements, and other waivers relating to 

acquisitions in support of operations in 

Afghanistan apply to this acquisition. 

Therefore, the Balance of Payments Program 

restrictions are waived for SC/CASA state 

and designated country construction 

materials. 

(c) The Contractor shall use only domestic, 

SC/CASA state, or designated country 

construction material in performing this 

contract, except for— 

(1) Construction material valued at or 

below the simplified acquisition threshold in 

FAR part 2; 

(2) Information technology that is a 

commercial product; or 

(3) The construction material or 

components listed by the Government as 

follows: 

[Contracting Officer to list applicable 

excepted materials or indicate ‘‘none’’]. 

(d) If the Contractor is from an SC/CASA 

state, the Contractor shall inform its 

government of its participation in this 

acquisition and that it generally will not have 

such opportunity in the future unless its 

government provides reciprocal procurement 

opportunities to U.S. products and services 

and suppliers of such products and services. 


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11992 Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Rules and Regulations 

(End of clause) 

Alternate VII. As prescribed in 

225.7503(b) and (b)(8), use the following 

clause, which includes, in the definition 

of ‘‘domestic construction material’’ at 

paragraph (1)(ii)(A), the domestic 

content threshold that will apply to the 

entire contract period of performance; 

adds ‘‘South Caucasus/Central and 

South Asian (SC/CASA state)’’ and ‘‘SC/ 

CASA state construction material’’ to 

paragraph (a); uses a different paragraph 

(b) and introductory text for paragraph 

(c) than the basic clause; and adds 

paragraph (d): 

Balance of Payments Program—Construction 

Material Under Trade Agreements— 

Alternate VII (Feb 2024) 

(a) Definitions. As used in this clause— 

Caribbean Basin country construction 

material means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a Caribbean Basin country; or 

(2) In the case of a construction material 

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 construction 

material distinct from the materials from 

which it was transformed. 

Commercially available off-the-shelf 

(COTS) item— 

(1) Means any item of supply (including 

construction material) that is— 

(i) A commercial product (as defined in 

paragraph (1) of the definition of 

‘‘commercial product’’ in section 2.101 of the 

Federal Acquisition Regulation (FAR)); 

(ii) Sold in substantial quantities in the 

commercial marketplace; and 

(iii) Offered to the Government, under a 

contract or subcontract at any tier, without 

modification, in the same form in which it 

is sold in the commercial marketplace; and 

(2) Does not include bulk cargo, as defined 

in section 3 of the Shipping Act of 1984 (46 

U.S.C. 40102), such as agricultural products 

and petroleum products. 

Component means any article, material, or 

supply incorporated directly into 

construction material. 

Construction material means an article, 

material, or supply brought to the 

construction site by the Contractor or a 

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 (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 construction material. 

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 FAR 25.105. 

Critical item means domestic construction 

material or a domestic end product that is 

deemed critical to the U.S. supply chain. The 

list of critical items is at FAR 25.105. 

Designated country means— 

(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 the 

United Kingdom); 

(2) A Free Trade Agreement country 

(Australia, Bahrain, Chile, Colombia, Costa 

Rica, Dominican Republic, El Salvador, 

Guatemala, Honduras, Korea (Republic of), 

Mexico, Morocco, Nicaragua, 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, TimorLeste, 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 construction material 

means a construction material that is a WTO 

GPA country construction material, a Free 

Trade Agreement country construction 

material, a least developed country 

construction material, or a Caribbean Basin 

country construction material. 

Domestic construction material means— 

(1) For construction material that does not 

consist wholly or predominantly of iron or 

steel or a combination of both— 

(i) An unmanufactured construction 

material mined or produced in the United 

States; or 

(ii) A construction material manufactured 

in the United States, if— 

(A) The cost of its components mined, 

produced, or manufactured in the United 

States exceeds, for the entire period of 

performance for a contract awarded in: 

calendar year 2023, 60 percent of the cost of 

all its components; calendar years 2024 

through 2028, 65 percent of the cost of all its 

components; or calendar year 2029 or later, 

75 percent of the cost of all its components. 

Components of foreign origin of the same 

class or kind for which nonavailability 

determinations have been made are treated as 

domestic. Components of unknown origin are 

treated as foreign; or 

(B) The construction material is a COTS 

item; or 

(2) 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 iron and steel not produced in the 

United States (excluding fasteners) as 

estimated in good faith by the contractor, 

constitutes less than 5 percent of the cost of 

all the components used in such construction 

material (produced in the United States 

means that all manufacturing processes of the 

iron or steel must take place in the United 

States, except metallurgical processes 

involving refinement of steel additives). The 

cost of iron and steel not produced in the 

United States includes but is not limited to 

the cost of iron or steel mill products (such 

as bar, billet, slab, wire, plate, or sheet), 

castings, or forgings, not produced in the 

United States, utilized in the manufacture of 

the construction material and a good faith 

estimate of the cost of iron or steel 

components not produced in the United 

States, 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 

clause. 

Free Trade Agreement country 

construction material means a construction 

material that— 

(1) Is wholly the growth, product, or 

manufacture of a Free Trade Agreement 

country; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 

transformed in a Free Trade Agreement 

country into a new and different construction 

material distinct from the material from 

which it was transformed. 

Least developed country construction 

material means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a least developed country; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 


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Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Rules and Regulations 11993 

transformed in a least developed country into 

a new and different construction material 

distinct from the materials from which it was 

transformed. 

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. 

South Caucasus/Central and South Asian 

(SC/CASA) state means Armenia, Azerbaijan, 

Georgia, Kazakhstan, Kyrgyzstan, Pakistan, 

Tajikistan, Turkmenistan, or Uzbekistan. 

SC/CASA state construction material 

means construction material that— 

(1) Is wholly the growth, product, or 

manufacture of an SC/CASA state; or 

(2) In the case of a construction material 

that consists in whole or in part of materials 

from another country, has been substantially 

transformed in an SC/CASA state into a new 

and different construction material distinct 

from the material from which it was 

transformed. 

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. 

WTO GPA country construction material 

means a construction material that— 

(1) Is wholly the growth, product, or 

manufacture of a WTO GPA country; or 

(2) In the case of a construction material 

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 construction material 

distinct from the materials from which it was 

transformed. 

(b) This clause implements the Balance of 

Payments Program by providing a preference 

for domestic construction material. In 

addition, the Contracting Officer has 

determined that the WTO GPA, all Free 

Trade Agreements except United StatesMexico-Canada Agreement and the Bahrain 

Free Trade Agreement, and other waivers 

relating to acquisitions in support of 

operations in Afghanistan apply to this 

acquisition. Therefore, the Balance of 

Payments Program restrictions are waived for 

SC/CASA state and designated country 

construction material other than Bahraini or 

Mexican construction material. 

(c) The Contractor shall use only domestic, 

SC/CASA state, or designated country 

construction material other than Bahraini or 

Mexican construction material in performing 

this contract, except for— 

(1) Construction material valued at or 

below the simplified acquisition threshold in 

FAR part 2; 

(2) Information technology that is a 

commercial product; or 

(3) The construction material or 

components listed by the Government as 

follows: 

[Contracting Officer to list applicable 

excepted materials or indicate ‘‘none’’]. 

(d) If the Contractor is from an SC/CASA 

state, the Contractor shall inform its 

government of its participation in this 

acquisition and that it generally will not have 

such opportunity in the future unless its 

government provides reciprocal procurement 

opportunities to U.S. products and services 

and suppliers of such products and services. 

(End of clause) 

[FR Doc. 2024–01220 Filed 2–14–24; 8:45 am] 

BILLING CODE 6001–FR–P 


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