37440 Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Parts 225 and 252 

[Docket DARS–2021–0012] 

RIN 0750–AK85 

Defense Federal Acquisition 

Regulation Supplement: Maximizing 

the Use of American-Made Goods, 

Products, and Materials (DFARS Case 

2019–D045) 

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 regarding maximizing the use of 

American-made goods, products, and 

materials. 

DATES: Effective June 23, 2022. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Kimberly Bass, telephone 571–372– 

6174. 

SUPPLEMENTARY INFORMATION: 

I. Background 

DoD is issuing a final rule amending 

the DFARS to implement Executive 

Order (E.O.) 13881, Maximizing Use of 

American-made Goods, Products, and 

Materials, which calls for more 

aggressive implementation of the Buy 

American statute (41 U.S.C. chapter 83) 

to maximize the Government’s 

procurement of American-made goods, 

products, and materials. The Buy 

American statute requires the purchase 

of domestic products (both end products 

and construction materials), except 

when the domestic product is not 

available, the domestic product is only 

available at an unreasonable cost, or it 

would not be in the public interest to 

buy the domestic product. 

E.O. 13881 supersedes E.O. 10582, 

Prescribing Procedures for Certain 

Determinations under the Buy American 

Act. E.O. 13881 establishes that under 

the Buy American statute a product is 

foreign if the cost of all foreign 

components used in such product 

constitutes 45 percent or more of the 

cost of all components, except that iron 

and steel products are foreign if the cost 

of foreign iron and steel equals or 

exceeds 5 percent of the cost of all 

components. This rule strengthens 

domestic preferences under the Buy 

American statute, as required by E.O. 

13881, by changing how a domestic 

product is defined, while also 

maintaining the exception for qualifying 

countries. 

DoD published a proposed rule in the 

Federal Register at 86 FR 48370 on 

August 30, 2021. Five 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. Analysis of Public Comments 

1. Support for the Rule 

Comment: Several respondents 

expressed support for the rule, and 

stated that the United States 

Government should maximize the use of 

goods, products, and materials 

produced in the United States; the rule 

benefits the overall intent of the 

strategic national defense policy; and is 

an effective regulatory technique for 

incentivizing the domestic industry as a 

whole. A respondent further stated the 

overall public policy and public opinion 

are already gravitating toward the 

increase of domestic production, which 

only serves to further incentivize the 

increase in this type of production. This 

respondent supports the increased 

domestic content requirements for iron 

and steel and iron and steel products 

such as fasteners. 

Response: DoD acknowledges the 

respondents’ support for the rule. 

2. Commercially Available-Off-the-Shelf 

(COTS) Items Exception—COTS Waiver 

for Fasteners 

Comment: A couple of respondents 

conveyed that the waiver of the 

domestic content test of the Buy 

American statute for the acquisition of 

COTS fasteners would create a 

competitive disadvantage for domestic 

fastener manufacturers, especially when 

all other COTS waivers were removed 

for iron and steel products in Federal 

Acquisition Regulation (FAR) Case 

2019–016 (86 FR 6180, January 19, 

2021). A respondent further stated that 

to keep the COTS waiver for fasteners 

but remove it for all other iron and steel 

products only further worsened the 

competitive field for fastener 

manufacturers. 

A respondent further stated that 

currently, a COTS item is considered 

compliant with the Buy American 

statute if its final stage of manufacturing 

occurs in the United States, without 

regard for the origin of the COTS 

components. The respondent also stated 

that this policy stands in stark contrast 

with the goals of other domestic content 

preferences, particularly the Buy 

America statute that applies to Federal 

assistance infrastructure programs that 

explicitly provides that products are 

only considered American-made if all 

manufacturing processes from the initial 

melting stage through the application of 

coatings take place in the United States. 

The COTS waiver takes the opposite 

approach with negative consequences 

for upstream suppliers of raw materials 

and subcomponents of products and 

allows for products that are entirely 

comprised of foreign material to be 

considered American-made so long as 

the final processing stage occurs in the 

United States. 

Response: The roll-back of the COTS 

waiver is necessary to give full effect to 

the E.O. 13881 requirement. The 

fasteners being exempted from the 

domestic content requirement are those 

that are COTS items. The current FAR 

contract clauses implementing the Buy 

American statute apply to a narrow set 

of procurements. In addition, because 

the Federal Acquisition Regulatory 

Council retained the COTS items 

exception for most COTS items in its 

implementation of the E.O. in the FAR, 

the heightened domestic content 

requirements will not be applicable to 

those procurements. (See the final rule 

for FAR Case 2019–016 published at 86 

FR 6180 on January 19, 2021.) This 

DFARS rule takes the same approach. 

3. Unreasonable Cost 

Comment: A respondent stated that 

the Buy American statute requires the 

purchase of domestic products, except if 

the product is only available at an 

unreasonable cost, and recommended 

the addition of a percent cost above 

nondomestic goods, products, and 

materials to ensure it is followed more 

specifically. The respondent further 

recommended the inclusion of a 

financial credit for those that comply 

with the Buy American statute. 

Response: To implement E.O. 13881 

no revisions were required in the rule to 

change the percentage factor used to 

determine whether the offered price of 

material of domestic origin is 

unreasonable or inconsistent with 

public interest. In order to determine 

whether the cost of a domestic product 

is unreasonable, E.O. 13881 increased 

the minimum percentage factor from 6 

percent to 20 percent for other than 

small businesses and from 12 percent to 

30 percent for small businesses (86 FR 

6180, January 19, 2021). If the price of 

the domestic product exceeds the price 


lotter on DSK11XQN23PROD with RULES1
Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 37441 

of the foreign product by more than 20 

percent for other than small businesses, 

then the price of the domestic product 

is unreasonable. This does not apply to 

DoD, since DoD already uses a 50 

percent factor for both small and other 

than small businesses. 

4. Public Interest Definition 

Comment: A respondent 

recommended a better definition of 

what would not be in the public 

interest. 

Response: DoD acknowledges the 

comment regarding creation of a new 

public interest definition. A definition 

to determine what would not be in the 

public interest is not required and 

would be inconsistent with the 

implementation in the final rule for FAR 

case 2019–016 published at 86 FR 6180, 

on January 19, 2021. 

5. Outside the Scope of the Rule 

Comment: A respondent conveyed 

that excluding COTS items from the Buy 

American statute impairs the statute 

from achieving the stated purpose of the 

E.O. 14005, Ensuring the Future Is Made 

in All of America by All of America’s 

Workers. Another respondent stated that 

the continuation of a COTS waiver for 

fasteners is no longer valid. 

Additionally, a respondent provided 

comments regarding the OMB 

Memorandum M–21–26, Increasing 

Opportunities for Domestic Sourcing 

and Reducing the Need for Waivers 

from Made in America Laws, and 

impacts on COTS waivers. The 

respondent also recommended keeping 

the fastener language in DFARS 

252.225–7009, Restriction on 

Acquisition of Specialty Metals, for 

fasteners provided to the six major DoD 

programs as it allows for improved 

efficiency for U.S. fastener 

manufacturers providing both 

commercial and defense applications to 

the same prime contractor, while still 

protecting the domestic steel and 

fastener industries. 

Another respondent provided 

comments in response to the final rule 

for FAR case 2019–016 published at 86 

FR 6180 on January 19, 2021. 

Response: This final rule implements 

E.O. 13881, Maximizing Use of 

American-made Goods, Products, and 

Materials, in the DFARS in accordance 

with the E.O. requirements, and 

supplements the FAR in accordance 

with the final rule as published 

implementing E.O. 13881 (86 FR 6180, 

dated January 19, 2021). The 

respondent’s comment that excluding 

COTS items from the Buy American 

statute impairs the statute from 

achieving the stated purpose of the E.O. 

14005, Ensuring the Future Is Made in 

All of America by All of America’s 

Workers, is outside the scope of this 

rule. 

The respondent’s comment 

referencing the OMB Memorandum M– 

21–26, Increasing Opportunities for 

Domestic Sourcing and Reducing the 

Need for Waivers from Made in America 

Laws, is outside the scope of this rule. 

Lastly, the comment referencing the 

requirements in DFARS 252.225–7009, 

Restriction on Acquisition of Specialty 

Metals, is outside the scope of this rule. 

B. Other Changes 

Paragraph (2) of the definition of 

‘‘domestic construction material’’ has 

been revised in the following clauses to 

refer to the definition of ‘‘cost of 

components’’ instead of paragraph 

(1)(ii)(A) of the definition of ‘‘domestic 

construction material’’: 252.225–7044 

(basic clause and alternate I) and 

252.225–7045 (basic clause and 

alternates I through III). Paragraph 

(1)(ii)(A) does not provide information 

regarding the cost of components, which 

is located in the definition of that term. 

III. Applicability to Contracts at or 

Below the Simplified Acquisition 

Threshold, for Commercial Products 

Including Commercially Available Offthe-Shelf Items, and for Commercial 

Services 

This final rule does not add any new 

provisions or clauses, nor change the 

applicability of existing provisions or 

clauses to contracts at or below the 

simplified acquisition threshold, 

contracts for the acquisition of 

commercial products including 

commercially available off-the-shelf 

items, and for commercial services. 

IV. Expected Impact of the Rule 

The current FAR contract clauses 

implementing the Buy American statute 

apply to a narrow set of procurements. 

In addition, because the Federal 

Acquisition Regulatory Council retained 

the COTS items exception for most 

COTS items in its implementation of 

E.O. 13881 in the FAR, the heightened 

domestic content requirements will not 

be applicable to those procurements. 

(See the final rule for FAR Case 2019– 

016 published at 86 FR 6180 on January 

19, 2021.) This final DFARS rule takes 

the same approach. 

Domestic industries supplying 

domestic end products are likely to 

benefit from a competitive advantage as 

a result of the FAR and DFARS 

implementation. Based on the E.O., it is 

unclear if the pool of qualified suppliers 

would be reduced, resulting in less 

competition and a possible increase in 

prices that the Government will pay to 

procure these products. At least three 

arguments point to the likelihood that 

any increase in burden on contractors 

would be small, if not de minimis: 

(1) Familiarization costs should be 

low. 

(2) Some, if not many, contractors 

may already be able to meet the more 

stringent threshold. 

(3) Costs incurred by contractors who 

adjust their supply chains, so that their 

end products qualify as domestic, will 

enjoy a larger price preference that 

should help to offset these costs over 

time. 

Each of these arguments is explained 

below. 

First, DoD does not anticipate 

significant costs from contractor 

familiarization with the rule given the 

publication of the FAR final rule 

implementing E.O. 13881 and the 

history of rulemaking and E.O.s in 

general in this area. The basic 

mechanics of the Buy American statute 

(e.g., how and when the price 

preference is used to favor domestic end 

products, certifications required of 

offerors to demonstrate end products are 

domestic) continue to reflect processes 

that have been in place for decades and 

are not new to contractors. 

Second, some, if not many, 

contractors may already be able to 

comply with the lower foreign content 

requirement needed to meet the 

definition of domestic end product 

under E.O. 13881 and the final rule. 

Laws such as the SECURE Technology 

Act (Pub. L. 115–390), which requires a 

series of actions to strengthen the 

Federal infrastructure for managing 

supply chain risks, are placing 

significantly increased emphasis on 

Federal agencies and Federal 

Government contractors to identify and 

reduce risk in their supply chains. 

One way to reduce supply chain risk 

is to increase domestic sourcing of 

content. In addition, in the context of 

iron and steel, many laws already in 

place call for more stringent accounting 

of domestic sourcing of content. For 

example, the Recovery Act required that 

all construction material for a project for 

the construction, alteration, 

maintenance, or repair of a public 

building or a public work in the United 

States, consisting wholly or 

predominantly of iron or steel, had to be 

produced in the United States when 

using Recovery Act funds, to the extent 

consistent with trade agreements (see 

FAR 25.602–1, implementing section 

1605 of the Recovery Act). 

In addition, Federal contractors who 

also work on contracts funded under 

Federal grants may, in some cases, find 


lotter on DSK11XQN23PROD with RULES1
37442 Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 

that the steel, iron, and manufactured 

goods used in the project must be 

produced in the United States, as is the 

case for certain funding administered by 

the Federal Transit Administration for 

public transportation projects (see 49 

U.S.C. 5323(j)). 

Third, it is anticipated that some 

contractors’ products and construction 

materials may not meet the definition of 

domestic end product and domestic 

construction material unless the 

contractors take steps to adjust their 

supply chains to increase the domestic 

content. Those contractors that make a 

business decision not to modify their 

supply chains will still be able to bid on 

DoD contracts but will no longer enjoy 

a price preference. 

Accordingly, it is likely that the 

Federal market for iron and steel has 

already completed significant retooling 

and could meet the requirements of E.O. 

13881 without too much additional 

effort. 

This rule amends the clauses that 

implement the Buy American statute. 

There are four clauses affected by the 

changes in this rule: 

(1) 252.225–7001, Buy American and 

Balance of Payments Program (Basic and 

Alternate I). 

(2) 252.225–7036, Buy American— 

Free Trade Agreements—Balance of 

Payments Program (Basic and Alternates 

I–V). 

(3) 252.225–7044, Balance of 

Payments Program—Construction 

Material (Basic and Alternate I). 

(4) 252.225–7045, Balance of 

Payments Program—Construction 

Material (Basic and Alternates I–III). 

This rule changes the definitions of 

‘‘domestic end product’’ and ‘‘domestic 

construction material.’’ The rule also 

adds the definitions of ‘‘steel’’ and 

‘‘predominantly of iron or steel or a 

combination of both’’ in the clauses to 

conform the DFARS with the FAR 

implementation of E.O. 13881. 

According to the Federal Procurement 

Data System (FPDS) data for fiscal year 

(FY) 2017, FY 2018, and FY 2019 for 

new awards with a foreign place of 

performance for construction valued 

over the micro-purchase threshold and 

for awards for supplies, DoD awarded 

an average of 3,222 construction 

contracts with a foreign place of 

performance per year. In addition, DoD 

awarded an average of 332,607 supply 

contracts per year during FY 2017 

through FY 2019. 

In summary, the rule will strengthen 

domestic preferences under the Buy 

American statute and provide both large 

and small businesses the opportunity 

and incentive to deliver U.S. 

manufactured products from domestic 

suppliers. It is expected that this rule 

will benefit large and small U.S. 

manufacturers, including those of iron 

or steel. 

Therefore, based on public comments 

received, DoD has concluded that the 

initial assessment is correct that the cost 

impact of this rule is not significant, and 

any impact is predominantly positive. 

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 a significant 

regulatory action and, therefore, was 

subject to review under section 6(b) of 

E.O. 12866, Regulatory Planning and 

Review, dated September 30, 1993. 

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 

(FRFA) has been prepared consistent 

with the Regulatory Flexibility Act, 5 

U.S.C. 601, et seq. The FRFA is 

summarized as follows: 

This rule is required to amend the 

Defense Federal Acquisition Regulation 

Supplement (DFARS) to implement 

Executive Order (E.O.) 13881, 

Maximizing Use of American-Made 

Goods, Products, and Materials, and 

also to make conforming changes to the 

applicable clauses as a result of 

implementation of the E.O. in the 

Federal Acquisition Regulation (FAR). 

The objective of this rule is to 

strengthen domestic preferences under 

the Buy American statute, as required 

by E.O. 13881, by changing how a 

domestic end product and domestic 

construction material are defined. 

There were no significant issues 

raised by the public comments in 

response to the initial regulatory 

flexibility analysis. 

Data was obtained from the Federal 

Procurement Data System (FPDS) for 

new awards valued over the micropurchase threshold in fiscal year (FY) 

2017, FY 2018, and FY 2019 that had a 

foreign place of performance and were 

for construction. DoD awarded an 

average of 3,222 construction contracts 

with a foreign place of performance per 

year during FY 2017 through FY 2019. 

Of those construction contracts, 

approximately 65 were awarded to 32 

unique small entities per year. 

Data was also obtained from FPDS for 

FY 2017 through FY 2019 for new 

awards valued over the micro-purchase 

threshold for supplies made in the 

United States. DoD awarded an average 

of 332,607 supply contracts per year 

during FY 2017 through FY 2019. Of 

those supply contracts, approximately 

154,422 supply contracts were awarded 

to 13,480 unique small entities per year. 

The rule will strengthen domestic 

preferences under the Buy American 

statute and provide small businesses the 

opportunity and incentive to deliver 

U.S. manufactured products from 

domestic suppliers. It is expected that 

this rule will benefit U.S. small business 

manufacturers, including those of iron 

or steel. Small business manufacturers 

who do not already meet the increased 

domestic content requirements of this 

proposed rule may need to adjust their 

supply chains. DoD does not have data 

on how many small business 

manufacturers may decide to make such 

adjustments. 

This rule does not include any new 

reporting, recordkeeping, or other 

compliance requirements for small 

businesses, other than to increase the 

percentages used in the domestic 

content test applied to offers of 

manufactured end products. 

There are no known significant 

alternative approaches to the rule that 

would meet the requirements of E.O. 

13881. 

VIII. Paperwork Reduction Act 

The rule does not contain any 

information collection requirements that 

require the approval of the Office of 

Management and Budget under the 

Paperwork Reduction Act (44 U.S.C. 

chapter 35). 


lotter on DSK11XQN23PROD with RULES1
Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 37443 

List of Subjects in 48 CFR Parts 225 and 

252 

Government procurement. 

Jennifer D. Johnson, 

Editor/Publisher, Defense Acquisition 

Regulations System. 

Therefore, 48 CFR parts 225 and 252 

are amended as follows: 

■ 1. The authority citation for parts 225 

and 252 continues to read as follows: 

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

chapter 1. 

PART 225—FOREIGN ACQUISITION 

■ 2. Amend section 225.003 by— 

■ a. Revising the definition of 

‘‘Domestic end product’’; 

■ b. Removing the definition 

‘‘Qualifying country component and 

qualifying country end product’’; and 

■ c. Adding definitions for ‘‘Qualifying 

country component’’ and ‘‘Qualifying 

country end product’’ in alphabetical 

order. 

The revision and additions read as 

follows: 

225.003 Definitions. 

* * * * * 

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 55 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 commercially 

available off-the-shelf (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. 

* * * * * 

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 50 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. 

* * * * * 

■ 3. Amend section 225.101 by revising 

paragraph (a)(ii) to 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 55 percent 

of the cost of all its components. This 

test is applied to end products only and 

not to individual components. 

(B) For an end product that consists 

wholly or predominantly of iron or steel 

or a combination of both, the cost of 

iron and steel not produced in the 

United States or a qualifying country 

must constitute less than 5 percent of 

the cost of all the components used in 

the end product. 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 

commercially available off-the-shelf 

(COTS) fasteners. The domestic content 

test of the Buy American statute has not 

been waived for acquisitions of COTS 

items in this category, except for COTS 

fasteners. 

* * * * * 

225.502 [Amended] 

■ 4. Amend section 225.502 by— 

■ a. In paragraph (c)(ii)(B), removing 

‘‘225.504(1)’’ and adding ‘‘PGI 

225.504(1)’’ in its place; 

■ b. In paragraph (c)(ii)(D), removing 

‘‘225.504(2)’’ and adding ‘‘PGI 

225.504(2)’’ in its place; 

■ c. In paragraph (c)(ii)(E)(1), removing 

‘‘225.504(3)’’ and adding ‘‘PGI 

225.504(3)’’ in its place; and 

■ d. In paragraph (c)(ii)(E)(2), removing 

‘‘225.504(4)’’ and adding ‘‘PGI 

225.504(4)’’ in its place. 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 5. Amend section 252.225–7001 by— 

■ a. Removing the clause date of ‘‘(MAR 

2022)’’ and adding ‘‘(JUN 2022)’’ in its 

place; 

■ b. In paragraph (a)— 

■ i. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 


lotter on DSK11XQN23PROD with RULES1
37444 Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ ii. Revising the definition of 

‘‘Domestic end product’’; 

■ iii. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ iv. Revising the definition of 

‘‘Qualifying country end product’’; and 

■ v. Adding, in alphabetical order, the 

definition of ‘‘Steel’’; and 

■ c. In Alternate I— 

■ i. Removing the clause date of ‘‘(MAR 

2022)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ B. Revising the definition of 

‘‘Domestic end product’’; 

■ C. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ D. Revising the definition of 

‘‘Qualifying country end product’’; 

■ E. In the definition of ‘‘South 

Caucasus/Central and South Asian (SC/ 

CASA) state end product’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; and 

■ F. Adding, in alphabetical order, the 

definition of ‘‘Steel’’. 

The revisions and additions read as 

follows: 

252.225–7001 Buy American and Balance 

of Payments Program. 

* * * * * 

(a) * * * 

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 55 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. 

* * * * * 

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 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 50 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. 

* * * * * 

Alternate I. * * * 

* * * * * 

(a) * * * 

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 55 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 


lotter on DSK11XQN23PROD with RULES1
Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 37445 

(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. 

* * * * * 

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 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 50 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. 

* * * * * 

■ 6. Amend section 252.225–7036 by— 

■ a. Removing the clause date of ‘‘(MAR 

2022)’’ and adding ‘‘(JUN 2022)’’ in its 

place. 

■ b. In paragraph (a)— 

■ i. In the definition of ‘‘Bahrainian end 

product’’, redesignating paragraphs (i) 

and (ii) as paragraphs (1) and (2), 

respectively; 

■ ii. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ iii. Revising the definition of 

‘‘Domestic end product’’; 

■ iv. In the definition of ‘‘Free Trade 

Agreement country’’, removing the 

semicolon and adding a period in its 

place; 

■ v. In the definitions of ‘‘Free Trade 

Agreement country end product’’, 

‘‘Moroccan end product’’, ‘‘Panamanian 

end product’’, and ‘‘Peruvian end 

product’’, redesignating paragraphs (i) 

and (ii) as paragraphs (1) and (2), 

respectively; 

■ vi. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ vii. Revising the definition of 

‘‘Qualifying country end product’’; and 

■ viii. Adding, in alphabetical order, the 

definition of ‘‘Steel’’. 

■ c. In Alternate I— 

■ i. Removing the clause date of ‘‘(MAR 

2022)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definitions of ‘‘Bahrainian 

end product’’ and ‘‘Canadian end 

product’’, redesignating paragraphs (i) 

and (ii) as paragraphs (1) and (2), 

respectively; 

■ B. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ C. Revising the definition of 

‘‘Domestic end product’’; 

■ D. In the definition of ‘‘Free Trade 

Agreement country’’, removing the 

semicolon and adding a period in its 

place; 

■ E. In the definitions of ‘‘Free Trade 

Agreement country end product’’, 

‘‘Moroccan end product’’, ‘‘Panamanian 

end product’’, and ‘‘Peruvian end 

product’’, redesignating paragraphs (i) 

and (ii) as paragraphs (1) and (2), 

respectively; 

■ F. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ G. Revising the definition of 

‘‘Qualifying country end product’’; and 

■ H. Adding, in alphabetical order, the 

definition of ‘‘Steel’’. 

■ d. In Alternate II— 

■ i. Removing the clause date of ‘‘(MAR 

2022)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Bahrainian 

end product’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ B. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ C. Revising the definition of 

‘‘Domestic end product’’; 

■ D. In the definition of ‘‘Free Trade 

Agreement country’’, removing the 

semicolon and adding a period in its 

place; 

■ E. In the definitions of ‘‘Free Trade 

Agreement country end product’’, 

‘‘Moroccan end product’’, ‘‘Panamanian 

end product’’, and ‘‘Peruvian end 

product’’, redesignating paragraphs (i) 

and (ii) as paragraphs (1) and (2), 

respectively; 

■ F. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ G. Revising the definition of 

‘‘Qualifying country end product’’; 

■ H. In the definition of ‘‘South 

Caucasus/Central and South Asian (SC/ 

CASA) state end product’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; and 

■ I. Adding, in alphabetical order, the 

definition of ‘‘Steel’’. 

■ e. In Alternate III— 

■ i. Removing the clause date of ‘‘(MAR 

2022)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 


lotter on DSK11XQN23PROD with RULES1
37446 Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 

■ A. In the definitions of ‘‘Bahrainian 

end product’’ and ‘‘Canadian end 

product’’, redesignating paragraphs (i) 

and (ii) as paragraphs (1) and (2), 

respectively; 

■ B. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ C. Revising the definition of 

‘‘Domestic end product’’; 

■ D. In the definition of ‘‘Free Trade 

Agreement country’’, removing the 

semicolon and adding a period in its 

place; 

■ E. In the definitions of ‘‘Free Trade 

Agreement country end product’’, 

‘‘Moroccan end product’’, ‘‘Panamanian 

end product’’, and ‘‘Peruvian end 

product’’, redesignating paragraphs (i) 

and (ii) as paragraphs (1) and (2), 

respectively; 

■ F. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ G. Revising the definition of 

‘‘Qualifying country end product’’; 

■ H. In the definition of ‘‘South 

Caucasus/Central and South Asian (SC/ 

CASA) state end product’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; and 

■ I. Adding, in alphabetical order, the 

definition of ‘‘Steel’’. 

■ f. In Alternate IV— 

■ i. Removing the clause date of ‘‘(MAR 

2022)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Bahrainian 

end product’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ B. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ C. Revising the definition of 

‘‘Domestic end product’’; 

■ D. In the definition of ‘‘Free Trade 

Agreement country’’, removing the 

semicolon and adding a period in its 

place; 

■ E. In definitions of ‘‘Free Trade 

Agreement country end product’’, 

‘‘Korean end product’’, ‘‘Moroccan end 

product’’, ‘‘Panamanian end product’’, 

and ‘‘Peruvian end product’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; 

■ F. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ G. Revising the definition of 

‘‘Qualifying country end product’’; and 

■ H. Adding, in alphabetical order, the 

definition of ‘‘Steel’’. 

■ g. In Alternate V— 

■ i. Removing the clause date of ‘‘(MAR 

2022)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Bahrainian 

end product’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ B. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ C. Revising the definition of 

‘‘Domestic end product’’; 

■ D. In the definition of ‘‘Free Trade 

Agreement country’’, removing the 

semicolon and adding a period in its 

place; 

■ E. In the definitions of ‘‘Free Trade 

Agreement country end product’’, 

‘‘Korean end product’’, ‘‘Moroccan end 

product’’, ‘‘Panamanian end product’’, 

and ‘‘Peruvian end product’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; 

■ F. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ G. Revising the definition of 

‘‘Qualifying country end product’’; 

■ H. In the definition of ‘‘South 

Caucasus/Central and South Asian (SC/ 

CASA) state end product’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; and 

■ I. Adding, in alphabetical order, the 

definition of ‘‘Steel’’. 

The revisions and additions read as 

follows: 

252.225–7036 Buy American—Free Trade 

Agreements—Balance of Payments 

Program. 

* * * * * 

(a) * * * 

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 55 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. 

* * * * * 

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 


lotter on DSK11XQN23PROD with RULES1
Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 37447 

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 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 50 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. 

* * * * * 

Alternate I. * * * 

(a) * * * 

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 55 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 

(C) 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. 

* * * * * 

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 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 50 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. 

* * * * * 

Alternate II. * * * 

(a) * * * 

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 55 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 


lotter on DSK11XQN23PROD with RULES1
37448 Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 

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. 

* * * * * 

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 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 50 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. 

* * * * * 

Alternate III. * * * 

(a) * * * 

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 55 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. 

* * * * * 

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 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 50 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. 

* * * * * 

Alternate IV. * * * 

(a) * * * 


lotter on DSK11XQN23PROD with RULES1
Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 37449 

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 55 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. 

* * * * * 

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 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 50 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. 

* * * * * 

Alternate V. * * * 

(a) * * * 

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 55 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. 

* * * * * 

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 


lotter on DSK11XQN23PROD with RULES1
37450 Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 

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 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 50 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. 

* * * * * 

■ 7. Amend section 252.225–7044 by— 

■ a. Removing the clause date of ‘‘(NOV 

2014)’’ and adding ‘‘(JUN 2022)’’ in its 

place. 

■ b. In paragraph (a)— 

■ i. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ ii. In the definition of ‘‘Cost of 

components’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ iii. Revising the definition of 

‘‘Domestic construction material’’; and 

■ iv. Adding, in alphabetical order, the 

definitions of ‘‘Predominantly of iron or 

steel or a combination of both’’ and 

‘‘Steel’’. 

■ c. In Alternate I— 

■ i. Removing the clause date of ‘‘(NOV 

2014)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Commercially 

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

removing the quotation mark, 

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ B. In the definition of ‘‘Cost of 

components’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ C. Revising the definition of 

‘‘Domestic construction material’’; 

■ D. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ E. In the definition of ‘‘SC/CASA state 

construction material’’, redesignating 

paragraphs (i) and (ii) as paragraphs (1) 

and (2), respectively; and 

■ F. Adding, in alphabetical order, the 

definition of ‘‘Steel’’. 

The revisions and additions read as 

follows: 

252.225–7044 Balance of Payments 

Program—Construction Material. 

* * * * * 

(a) * * * 

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 55 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. 

* * * * * 

Alternate I. * * * 

(a) * * * 

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 55 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 


lotter on DSK11XQN23PROD with RULES1
Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 37451 

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. 

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. 

* * * * * 

■ 8. Amend section 252.225–7045 by— 

■ a. Removing the clause date of ‘‘(AUG 

2019)’’ and adding ‘‘(JUN 2022)’’ in its 

place. 

■ b. In paragraph (a)— 

■ i. In the definition of ‘‘Caribbean 

Basin country construction material’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; 

■ ii. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ iii. In the definition of ‘‘Cost of 

components’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ iv. In the definition of ‘‘Designated 

country’’, redesignating paragraphs (i), 

(ii), (iii), and (iv) as paragraphs (1), (2), 

(3), and (4), respectively; 

■ v. Revising the definition of 

‘‘Domestic construction material’’; 

■ vi. In the definitions of ‘‘Free Trade 

Agreement country construction 

material’’ and ‘‘Least developed country 

construction material’’, redesignating 

paragraphs (i) and (ii) as paragraphs (1) 

and (2), respectively; 

■ vii. Adding, in alphabetical order, the 

definitions of ‘‘Predominantly of iron or 

steel or a combination of both’’ and 

‘‘Steel’’; and 

■ viii. In the definition of ‘‘WTO GPA 

country construction material’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively. 

■ c. In Alternate I— 

■ i. Removing the clause date of ‘‘(AUG 

2019)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definitions of ‘‘Bahrainian or 

Mexican construction material’’ and 

‘‘Caribbean Basin country construction 

material’’, redesignating paragraphs (i) 

and (ii) as paragraphs (1) and (2), 

respectively; 

■ B. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ C. In the definition of ‘‘Cost of 

components’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ D. In the definition of ‘‘Designated 

country’’, redesignating paragraphs (i), 

(ii), (iii), and (iv) as paragraphs (1), (2), 

(3), and (4), respectively; 

■ E. Revising the definition of 

‘‘Domestic construction material’’; 

■ F. In the definition of ‘‘Free Trade 

Agreement country construction 

material’’ and ‘‘Least developed country 

construction material’’, redesignating 

paragraphs (i) and (ii) as paragraphs (1) 

and (2), respectively; 

■ G. Adding, in alphabetical order, the 

definitions of ‘‘Predominantly of iron or 

steel or a combination of both’’ and 

‘‘Steel’’; and 

■ H. In the definition of ‘‘WTO GPA 

country construction material’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively. 

■ d. In Alternate II— 

■ i. Removing the clause date of ‘‘(AUG 

2019)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Caribbean 

Basin country construction material’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; 

■ B. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ C. In the definition of ‘‘Cost of 

components’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ D. In the definition of ‘‘Designated 

country’’, redesignating paragraphs (i), 

(ii), (iii), and (iv) as paragraphs (1), (2), 

(3), and (4), respectively; 

■ E. Revising the definition of 

‘‘Domestic construction material’’; 

■ F. In the definitions of ‘‘Free Trade 

Agreement country construction 

material’’ and ‘‘Least developed country 

construction material’’, redesignating 

paragraphs (i) and (ii) as paragraphs (1) 

and (2), respectively; 

■ G. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ H. In the definition of ‘‘SC/CASA state 

construction material’’, redesignating 

paragraphs (i) and (ii) as paragraphs (1) 

and (2), respectively; 

■ I. Adding, in alphabetical order, the 

definition of ‘‘Steel’’; and 

■ J. In the definition of ‘‘WTO GPA 

country construction material’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively. 

■ e. In Alternate III— 

■ i. Removing the clause date of ‘‘(AUG 

2019)’’ and adding ‘‘(JUN 2022)’’ in its 

place; and 

■ ii. In paragraph (a)— 

■ A. In the definition of ‘‘Caribbean 

Basin country construction material’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively; 

■ B. In the definition of ‘‘Commercially 

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

redesignating paragraphs (i) 

introductory text, (i)(A), (B), and (C), 

and (ii) as paragraphs (1) introductory 

text, (1)(i), (ii), and (iii), and (2), 

respectively; 

■ C. In the definition of ‘‘Cost of 

components’’, redesignating paragraphs 

(i) and (ii) as paragraphs (1) and (2), 

respectively; 

■ D. In the definition of ‘‘Designated 

country’’, redesignating paragraphs (i), 

(ii), (iii), and (iv) as paragraphs (1), (2), 

(3), and (4), respectively; 

■ E. Revising the definition of 

‘‘Domestic construction material’’; 

■ F. In the definitions of ‘‘Free Trade 

Agreement country construction 

material’’ and ‘‘Least developed country 

construction material’’, redesignating 

paragraphs (i) and (ii) as paragraphs (1) 

and (2), respectively; 

■ G. Adding, in alphabetical order, the 

definition of ‘‘Predominantly of iron or 

steel or a combination of both’’; 

■ H. In the definition of ‘‘SC/CASA state 

construction material’’, redesignating 

paragraphs (i) and (ii) as paragraphs (1) 

and (2), respectively; 

■ I. Adding, in alphabetical order, the 

definition of ‘‘Steel’’; and 


lotter on DSK11XQN23PROD with RULES1
37452 Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 

■ J. In the definition of ‘‘WTO GPA 

country construction material’’, 

redesignating paragraphs (i) and (ii) as 

paragraphs (1) and (2), respectively. 

The revisions and additions read as 

follows: 

252.225–7045 Balance of Payments 

Program—Construction Material Under 

Trade Agreements. 

* * * * * 

(a) * * * 

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 55 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. 

* * * * * 

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. 

* * * * * 

Alternate I. * * * 

(a) * * * 

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 55 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. 

* * * * * 

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. 

* * * * * 

Alternate II. * * * 

(a) * * * 

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 55 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 


lotter on DSK11XQN23PROD with RULES1
Federal Register / Vol. 87, No. 120 / Thursday, June 23, 2022 / Rules and Regulations 37453 

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. 

* * * * * 

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. 

* * * * * 

Alternate III. * * * 

(a) * * * 

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 55 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. 

* * * * * 

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. 

* * * * * 

[FR Doc. 2022–13373 Filed 6–22–22; 8:45 am] 

BILLING CODE 5001–06–P 


lotter on DSK11XQN23PROD with RULES1