67514 Federal Register / Vol. 60, No. 250 / Friday, December 29, 1995 / Rules and Regulations

DEPARTMENT OF DEFENSE

GENERAL SERVICES

ADMINISTRATION

NATIONAL AERONAUTICS AND

SPACE ADMINISTRATION

48 CFR Parts 25 and 52

[FAC 90–36; FAR Case 95–304]

RIN 9000–AG80

Federal Acquisition Regulation;

Uruguay Round

AGENCIES: Department of Defense (DOD),

General Services Administration (GSA),

and National Aeronautics and Space

Administration (NASA).

ACTION: Interim rule with request for

comments.

SUMMARY: The Civilian Agency

Acquisition Council and the Defense

Acquisition Regulations Council have

agreed on an interim rule to amend the

Federal Acquisition Regulation (FAR) to

implement the renegotiated General

Agreement on Tariffs and Trade (GATT)

Government Procurement Agreement

(1996 Code) (Uruguay Round) which

becomes effective January 1, 1996. This

regulatory action was not subject to

Office of Management and Budget

review under Executive Order 12866,

dated September 30, 1993.

DATES: Effective: January 1, 1996.

Applicability: This regulation applies to

solicitations issued on or after January

1, 1996. Comments Due: Comments on

the interim rule should be submitted to

the FAR Secretariat at the address

shown below on or before February 27,

1996 to be considered in the

formulation of a final rule.

ADDRESSES: FAR Secretariat, Room

4037, GS Building, Washington, DC

20405.

FOR FURTHER INFORMATION CONTACT:

Mr. Peter O’Such at (202) 501–1759 in

reference to this FAR case. For general

information, contact the FAR

Secretariat, Room 4037, GS Building,

Washington, DC 20405 (202) 501–4755.

Please cite FAC 90–36, FAR case 95–

304.

SUPPLEMENTARY INFORMATION:

A. Background

This interim rule amends the FAR to

implement the renegotiated General

Agreement on Tariffs and Trade (GATT)

Government Procurement Agreement

(1996 Code) (Uruguay Round) which

becomes effective January 1, 1996. This

agreement is implemented in statute by

the Uruguay Round Agreement Act,

Public Law 103–465, which amends the

Trade Agreements Act of 1979 (19

U.S.C. 2501–2582).

B. Regulatory Flexibility Act

This interim rule is not expected to

have a significant economic impact on

a substantial number of small entities

within the meaning of the Regulatory

Flexibility Act, 5 U.S.C. 601, et seq.,

because the rule does not impose any

new requirements on contractors, large

or small. The interim rule primarily

changes the list of designated foreign

countries and extends applicability of

the Trade Agreements Act to all

agencies for supply and construction

contracts over certain dollar thresholds.

However, those contracts which are now

subject to the Trade Agreements Act

were already subject to the

Memorandum of Understanding

Between the United States of America

and the European Community on

Government Procurement. This change

should have minimal impact on U.S.

firms. The interim rule will not

diminish existing preferences for small

businesses, because purchases under

small and small disadvantaged business

preference programs are exempted from

the Trade Agreements Act. An Initial

Regulatory Flexibility Analysis has,

therefore, not been performed.

Comments from small entities

concerning the affected subpart will be

considered in accordance with Section

610 of the Act. Such comments must be

submitted separately and cite FAC 90–

36, FAR case 95–304, in

correspondence.

C. Paperwork Reduction Act

This interim rule does not impose any

new reporting or recordkeeping

requirements which require Office of

Management and Budget (OMB)

approval under 44 U.S.C. 3501, et seq.

Contractors, which previously were

required to respond to the now deleted

provision at 52.225–16, Buy American

Act—Supplies under European

Community Agreement Certificate, will

now be required to respond to the

comparable provision at 52.225–8, Buy

American Act—Trade Agreements—

Balance of Payments Program Certificate

(OMB Control No. 9000–0046).

D. Determination to Issue an Interim

Rule

A determination has been made under

authority of the Secretary of Defense

(DoD), the Administrator of General

Services (GSA), and the Administrator

of the National Aeronautics and Space

Administration (NASA) that compelling

reasons exist to promulgate this interim

rule without prior opportunity for

public comment. This action is

necessary in order to implement the

renegotiated General Agreement on

Tariffs and Trade (GATT) Government

Procurement Agreement (1996 Code)

(Uruguay Round) which becomes

effective January 1, 1996. This

agreement is implemented in statute by

the Uruguay Round Agreement Act,

Public Law 103–465, which amends the

Trade Agreements Act of 1979 (19

U.S.C. 2501–2582). However, pursuant

to Public Law 98–577 and FAR 1.501,

public comments received in response

to this interim rule will be considered

in formulating the final rule.

List of Subjects in 48 CFR Parts 25 and

52

Government procurement.

Dated: December 22, 1995.

Edward C. Loeb,

Acting Director, Office of Federal Acquisition

Policy.

Federal Acquisition Circular

Number 90–36

Federal Acquisition Circular (FAC)

90–36 is issued under the authority of

the Secretary of Defense, the

Administrator of General Services, and

the Administrator for the National

Aeronautics and Space Administration.

Unless otherwise specified, all

Federal Acquisition Regulation (FAR)

and other directive material contained

in FAC 90–36 is effective January 1,

1996. This regulation applies to

solicitations issued on or after January

1, 1996.

Dated: December 21, 1995.

Eleanor R. Spector,

Director, Defense Procurement.

Dated: December 22, 1995.

Ida M. Ustad,

Associate Administrator, Office of

Acquisition Policy, GSA.

Dated: December 20, 1995.

Deidre Lee,

Associate Administrator for Procurement,

NASA.

Therefore, 48 CFR Parts 25 and 52 are

amended as set forth below:

1. The authority citation for 48 CFR

Parts 25 and 52 continues to read as

follows:

Authority: 40 U.S.C. 486(c); 10 U.S.C.

chapter 137; and 42 U.S.C. 2473(c).

PART 25—FOREIGN ACQUISITION

25.101 [Amended]

2. At 25.101 in the definition of

‘‘Instrumentality’’ the phrase ‘‘European

Economic Community’’ is revised to

read ‘‘European Union’’.
Federal Register / Vol. 60, No. 250 / Friday, December 29, 1995 / Rules and Regulations 67515

3. Section 25.104 is amended by

revising paragraph (a) to read as follows:

25.104 Acquiring civil aircraft and related

articles.

(a) The U.S. Trade Representative, on

February 19, 1980 (45 FR 12349,

February 25, 1980), waived applying the

Buy American Act to the acquisition of

civil aircraft and related articles of

countries or instrumentalities that are

parties to the Agreement on Civil

Aircraft. The representative acted under

the authority of section 303 of the Trade

Agreements Act of 1979 (19 U.S.C.

2513). Countries and Instrumentalities

that are parties to the agreement (as of

January 1, 1996) are Canada, the

European Union (Austria, Belgium,

Denmark, Finland, France, Germany,

Greece, Ireland, Italy, Luxembourg, the

Netherlands, Portugal, Spain, Sweden

and the United Kingdom), Japan,

Norway, Romania, and Switzerland. The

Office of the U.S. Trade Representative,

Washington, DC 20506, can provide

information on changes to the list of

parties to the agreement made since

January 1, 1996.

* * * * *

4. Section 25.109 is amended by

revising paragraph (d), removing

paragraphs (e) and (f), redesignating

paragraph (g) as (e) and revising the

introductory text and newly designated

paragraph (e)(2); and amending newly

designated paragraph (e)(1) by removing

the word ‘‘or’’. The revised text reads as

follows:

25.109 Solicitation provisions and

contract clauses.

* * * * *

(d) Except as provided in paragraph

(e) of this section, the contracting officer

shall insert the clause at 52.225–3, Buy

American Act—Supplies, in

solicitations and contracts for the

acquisition of supplies, or for services

involving the furnishing of supplies, for

use within the United States.

(e) Do not use the clause prescribed in

paragraph (d) of this section when—

* * * * *

(2) The acquisition is made under a

trade agreement (see subpart 25.4); or

* * * * *

25.202 [Amended]

5. At 25.202(c) the reference to

‘‘25.402(a) (3) and (4)’’ is revised to read

‘‘25.402(a) (1) and (3).

6. At 25.205 paragraph (b) is revised

to read as follows:

25.205 Solicitation provision and contract

clause.

* * * * *

(b)(1) For construction solicitations

and contracts with an estimated

acquisition value of $7,311,000 or more,

insert the basic clause at 52.225–15, Buy

American Act—Construction Materials

under Trade Agreements Act and North

American Free Trade Agreement.

(2) For construction solicitations and

contracts with an estimated value from

$6,500,000 to $7,311,000, insert the

clause with its Alternate I.

7. Section 25.400 is revised to read as

follows:

25.400 Scope of subpart.

(a) This subpart provides policies and

procedures for acquisitions subject to

the Agreement on Government

Procurement, as approved by Congress

in the Trade Agreements Act of 1979 (19

U.S.C. 2501–2582), and as amended by

the Uruguay Round Agreements Act

(Pub. L. 103–465), and other trade

agreements including—

(1) Acquisitions from countries

designated under the Caribbean Basin

Economic Recovery Act (19 U.S.C. 2701,

et seq.);

(2) Acquisitions involving offers of

Israeli end products under the U.S.-

Israel Free Trade Area Agreement, as

approved by Congress in the United

States-Israel Free Trade Area

Implementation Act of 1985 (19 U.S.C.

2112 note);

(3) Acquisitions involving offers of

Canadian or Mexican end products

under the North American Free Trade

Agreement (NAFTA), as approved by

Congress in the NAFTA Implementation

Act (Pub. L. 103–182, 107 Stat. 2057);

and

(4) The Agreement on Civil Aircraft

(19 U.S.C. 2513).

(b) For application of the trade

agreements which are unique to

individual agencies (Department of

Defense, National Aeronautics and

Space Administration, Department of

Energy (Power Marketing

Administration), Department of the

Interior (Bureau of Reclamation) and

Department of Transportation (Federal

Aviation Administration), see agency

regulations.

8. Section 25.401 is amended by

revising the definitions for ‘‘Canadian

end product,’’ ‘‘Caribbean Basin country

end product’’ introductory text and

paragraphs (a) and (b), ‘‘Designated

country,’’ ‘‘Designated country end

product,’’ and ‘‘Mexican end product,’’;

definitions for ‘‘European Community

(EC) construction material,’’ ‘‘EC

country,’’ and ‘‘EC end product,’’ are

removed; and a definition for

‘‘Designated country construction

material,’’ is added to read as follows:

25.401 Definitions.

* * * * *

Canadian end product, as used in this

subpart, means an article that (a) is

wholly the growth, product, or

manufacture of Canada, or (b) in the

case of an article which consists in

whole or in part of materials from

another country or instrumentality, has

been substantially transformed in

Canada into a new and different article

of commerce with a name, character, or

use distinct from that of the article or

articles from which it was transformed.

The term refers to a product offered for

purchase under a supply contract, but

for purposes of calculating the value of

the end product includes services

(except transportation services)

incidental to its supply; provided, that

the value of those incidental services

does not exceed that of the product

itself.

* * * * *

Caribbean Basin country end product,

as used in this subpart, means an article

that (a) is wholly the growth, product,

or manufacture of the Caribbean Basin

country, or (b) in the case of an article

which consists in whole or in part of

materials from another country or

instrumentality, has been substantially

transformed into a new and different

article of commerce with a name,

character, or use distinct from that of

the article or articles from which it was

so transformed. The term refers to a

product offered for purchase under a

supply contract, but for purposes of

calculating the value of the end product

includes services (except transportation

services) incidental to its supply;

provided, that the value of those

incidental services does not exceed that

of the product itself. The term excludes

products that are excluded from dutyfree treatment for Caribbean countries

under 19 U.S.C. 2703(b), which

presently are—

* * * * *

Designated country, as used in this

subpart, means a country or

instrumentality designated under the

Trade Agreements Act of 1979 and

listed below:

Aruba Japan

Austria Lesotho

Bangladesh Liechtenstein

Belgium Luxembourg

Benin Malawi

Bhutan Maldives

Botswana Mali

Burkina Faso Nepal

Burundi Netherlands

Canada Niger

Cape Verde Norway

Central African RepublicPortugal

Chad Republic of Korea

Comoros Rwanda
67516 Federal Register / Vol. 60, No. 250 / Friday, December 29, 1995 / Rules and Regulations

Denmark Somalia

Finland Spain

France Sudan

Gambia Sweden

Germany Switzerland

Greece Tanzania U.R.

Guinea Uganda

Haiti United Kingdom

Ireland Western Samoa

Israel Yemen

Italy

Designated country construction

material, as used in this subpart, means

construction material that (a) is wholly

the growth, product, or manufacture of

a designated country, or (b) in the case

of a construction material which

consists in whole or in part of materials

from another country or instrumentality,

has been substantially transformed in a

designated country into a new and

different construction material distinct

from the materials from which it was

transformed.

Designated country end product, as

used in this subpart, means an article

that (a) is wholly the growth, product,

or manufacture of the designated

country, or (b) in the case of an article

which consists in whole or in part of

materials from another country or

instrumentality, has been substantially

transformed into a new and different

article of commerce with a name,

character, or use distinct from that of

the article or articles from which it was

so transformed. The term refers to a

product offered for purchase under a

supply contract, but for purposes of

calculating the value of the end product

includes services (except transportation

services) incidental to its supply;

provided, that the value of those

incidental services does not exceed that

of the product itself.

* * * * *

Mexican end product, as used in this

subpart, means an article that (a) is

wholly the growth, product, or

manufacture of Mexico, or (b) in the

case of an article which consists in

whole or in part of materials from

another country or instrumentality, has

been substantially transformed in

Mexico into a new and different article

of commerce with a name, character, or

use distinct from that of the article or

articles from which it was transformed.

The term refers to a product offered for

purchase under a supply contract, but

for purposes of calculating the value of

the end product includes services

(except transportation services)

incidental to its supply; provided, that

the value of those incidental services

does not exceed that of the product

itself.

9. At 25.402 paragraphs (a) (1)

through (3) and (c) are revised, (a)(4) is

removed, and (a) (5) and (6) are

redesignated as (a) (4) and (5). The

revised text reads as follows:

25.402 Policy.

(a)(1) Executive Order 12260 requires

the U.S. Trade Representative to set the

dollar threshold for application of the

Trade Agreements Act. The current

threshold is $190,000 for supply and

services contracts and $7,311,000 for

construction contracts. The thresholds

will be published in the Federal

Register and will be distributed through

agency procedures on an expedited

basis. When the value of the proposed

acquisition of an eligible product is

estimated to be at or over the dollar

threshold, agencies shall evaluate offers

for an eligible product without regard to

the restrictions of the Buy American Act

(see subpart 25.1) or the Balance of

Payments Program (see subpart 25.3).

When the value of the proposed

construction contract is estimated to be

at or over the dollar threshold, agencies

shall evaluate offers of designated

country construction materials without

regard to the restrictions of the Buy

American Act (see subpart 25.2) or the

Balance of Payments Program (see

subpart 25.3). When the value of the

proposed acquisition is estimated to be

below the Trade Agreements Act

threshold, the restrictions of the Buy

American Act or the Balance of

Payments Program shall be applied to

foreign offers, except as noted in

paragraphs (a)(2) and (a)(3) of this

section (see 25.105).

(2) As required by Article 15 of the

U.S.-Israel Free Trade Area Agreement,

agencies other than the Department of

Defense, Department of Energy,

Department of Transportation, the

Bureau of Reclamation of the

Department of the Interior, the Federal

Housing Finance Board, and the Office

of Thrift Supervision shall evaluate

offers of Israeli end products at or above

$50,000 in amount without regard to the

restrictions of the Buy American Act

(see subpart 25.1) or the Balance of

Payments Program (see subpart 25.3).

(3) As required by the North

American Free Trade Agreement

(NAFTA) Implementation Act (Pub. L.

103–182, 107 Stat. 2057), agencies shall

evaluate offers of the following NAFTA

country end products without regard to

the restrictions of the Buy American Act

(see subpart 25.1) or the Balance of

Payments Program (see subpart 25.3):

(i) NAFTA country construction

materials under construction contracts

with an estimated acquisition value of

$6,500,000 or more.

(ii) Canadian end products under

supply contracts with an estimated

value above $25,000 and Mexican end

products under supply contracts with

an estimated value of $50,000 or more.

* * * * *

(c)(1) There shall be no acquisition of

foreign end products subject to the

Trade Agreements Act unless the

foreign end products are eligible

products, except as provided in

paragraphs (c)(2) and (c)(3) of this

section.

(2) The prohibition in paragraph (c)(1)

of this section does not apply if offers

of domestic end products or of eligible

products are either not received or are

insufficient to fulfill the requirements.

(3) A waiver may be granted under

section 302(b)(2) of the Trade

Agreements Act (19 U.S.C. 2512(b)(2)).

* * * * *

10. Section 25.403 is revised to read

as follows:

25.403 Exceptions.

This subpart does not apply to—

(a) Acquisitions below the dollar

thresholds in 25.402(a) (1) through (3),

respectively;

(b) Purchases under small or small

disadvantaged business preference

programs;

(c)(1) Purchases of arms, ammunition

or war materials, or purchases

indispensable for national security or

for national defense purposes, by the

Department of Defense, as provided in

departmental regulations;

(2) Purchases indispensable for

national security or for national defense

purposes, subject to policies established

by the U.S. Trade Representative.

(d) Research and development

contracts;

(e) Purchases of items for resale;

(f) Purchases under subpart 8.6,

Acquisition from Federal Prison

Industries, Inc., and subpart 8.7,

Acquisition from Nonprofit Agencies

Employing People Who Are Blind or

Severely Disabled; or

(g) Purchases of products that are

excluded from duty-free treatment for

Caribbean countries under 19 U.S.C.

2703 (b); which presently are—

(1) Textiles and apparel articles that

are subject to textile agreements;

(2) Footwear, handbags, luggage, flat

goods, work gloves, and leather wearing

apparel not designated as eligible

articles for this purpose of the

Generalized System of Preferences

under Title V of the Trade Act of 1974;

(3) Tuna, prepared or preserved in

any manner in airtight containers;

(4) Petroleum, or any product derived

from petroleum; and

(5) Watches and watch parts

(including cases, bracelets and straps),
Federal Register / Vol. 60, No. 250 / Friday, December 29, 1995 / Rules and Regulations 67517

of whatever type including, but not

limited to, mechanical, quartz digital or

quartz analog, if such watches or watch

parts contain any material that is the

product of any country to which the

Tariff Schedule of the United States

(TSUS) column two rates of duty apply.

25.406 and 25.407 [Removed]

11. Sections 25.406 and 25.407 are

removed and reserved.

12. Section 25.408 is amended by

revising the section heading and

paragraphs (a)(2) and (4) to read as

follows:

25.408 Solicitation provisions and

contract clauses.

(a) * * *

(2) The clause at 52.225–9, Buy

American Act—Trade Agreements—

Balance of Payments Program, in

solicitations and contracts for supplies

where the contracting officer has

determined that the acquisition is

subject to the Trade Agreements Act;

* * * * *

(4) The clause at 52.225–21, Buy

American Act—North American Free

Trade Agreement (NAFTA)

Implementation Act—Balance of

Payments Program, in solicitations and

contracts for supplies where the

contracting officer has determined that

the acquisition is not subject to the

Trade Agreements Act but is subject to

NAFTA.

* * * * *

13. 25.1000 is amended by adding a

new sentence at the end to read as

follows:

25.1000 Scope of subpart.

* * * For thresholds which are

unique to individual agencies (e.g.,

Power Marketing Administration of the

Department of Energy), see agency

regulations.

14. 25.1001 is revised to read as

follows:

25.1001 Definitions.

As used in this subpart—

Sanctioned European Union (EU)

construction means construction to be

performed in a sanctioned member state

of the EU and the contract is awarded

by a contracting activity located in the

United States or its territories.

Sanctioned EU end product means an

article that (a) is wholly the growth

product or manufacture of a sanctioned

member state of the EU or (b) in the case

of an article which consists in whole or

in part of materials from another

country or instrumentality, has been

substantially transformed into a new

and different article of commerce with

a name, character, or use distinct from

that from which it was so transformed

in a sanctioned member state of the EU.

The term refers to a product offered for

purchase under a supply contract, but

for purposes of calculating the value of

the end product includes services

(except transportation services)

incidental to its supply; provided, that

the value of these incidental services

does not exceed that of the product

itself.

Sanctioned EU services means

services to be performed in a sanctioned

member state of the EU when the

contract is awarded by a contracting

activity located in the United States or

its territories.

Sanctioned member state of the EU

means Austria, Belgium, Denmark,

Finland, France, Ireland, Italy,

Luxembourg, the Netherlands, Sweden,

and the United Kingdom.

15. 25.1002 is amended by revising

paragraphs (a)(1), (2), and (3)

introductory text, removing (a)(3)(i), and

redesignating (a)(3)(ii) as (a)(3)(i) and

revising it, and redesignating (a)(3)(iii)

as (a)(3)(ii); paragraph (c)(1)

introductory text is amended by

replacing ‘‘EC’’ with ‘‘EU.’’ The revised

text reads as follows:

25.1002 Trade sanctions.

(a) * * *

(1) Sanctioned EU end products with

an estimated acquisition value less than

$190,000.

(2) Sanctioned EU construction with

an estimated acquisition value less than

$7,311,000.

(3) Sanctioned EU services as follows:

(i) Service contracts with an estimated

acquisition value less than $190,000.

* * * * *

16. 25.1003 is revised to read as

follows:

25.1003 Contract clauses.

Except as provided in 25.1002(b) and

(c)—

(a) Insert the clause at 52.225–18,

European Union Sanctions for End

Products, in solicitations and contracts

for supplies with an estimated

acquisition value less than $190,000.

(b) Insert the clause at 52.225–19,

European Union Sanction for Services,

in solicitations and contracts for—

(1) Services with an estimated

acquisition value less than $190,000;

and

(2) All services listed in FAR

25.1002(a)(3)(ii).

PART 52—SOLICITATION PROVISIONS

AND CONTRACT CLAUSES

52.212–5 [Amended]

17. 52.212–5 is amended by revising

the date of the clause to read ‘‘(JAN

1996)’’; removing and reserving

paragraph (b)(12); and in (b)(13) and

(b)(14) by removing the phrase

‘‘Community Sanctions’’ and inserting

‘‘Union Sanctions’’ in its place.

18. 52.225–2 is amended by revising

the introductory text, the clause date,

and paragraph (b) to read as follows:

52.225–2 Waiver of Buy American Act for

Civil Aircraft and Related Articles.

As prescribed in 25.109(c), insert the

following provision:

Waiver of Buy American Act for Civil

Aircraft and Related Articles (Jan 1996)

* * * * *

(b) The U.S. Trade Representative has

waived applying the Buy American Act to

the acquisition of civil aircraft and related

articles (as defined in paragraph (a) of this

clause) of countries or instrumentaties that

are parties to the Agreement on Trade in

Civil Aircraft. As of January 1, 1996, those

countries and instrumentalities include

Canada, the European Union (Austria,

Belgium, Denmark, Finland, France,

Germany, Greece, Ireland, Italy, Luxembourg,

the Netherlands, Portugal, Spain, Sweden,

and the United Kingdom), Japan, Norway,

Romania, and Switzerland.

* * * * *

19. 52.225–9 is amended as follows:

a. by revising the clause date;

b. in the definition of ‘‘Caribbean

Basin country end product,’’ which

follows paragraph (a), the second

sentence is revised, the third sentence is

removed, and the fourth sentence is

amended to hyphenate the word ‘‘dutyfree’’;

c. in the definition of ‘‘Designated

country end product,’’ the second

sentence is revised, and the third

sentence is removed;

d. the definition ‘‘Eligible product’’ is

added in alphabetical order;

e. in the definition of ‘‘NAFTA

country end product,’’ the second

sentence is revised, and the third

sentence is removed; and

f. in paragraph (b) the fifth sentence

is revised.

The revised text reads as follows:

52.225–9 Buy American Act—Trade

Agreements—Balance of Payments

Program.

* * * * *

Buy American Act—Trade

Agreements—Balance of Payments

Program (Jan 1996)

(a) * * *

* * * * *

Caribbean Basin country end product,

* * * The term refers to a product offered for

purchase under a supply contract, but for

purposes of calculating the value of the end

product includes services (except

transportation services) incidental to its
67518 Federal Register / Vol. 60, No. 250 / Friday, December 29, 1995 / Rules and Regulations

supply; provided, that the value of those

incidental services does not exceed that of

the product itself. * * *

* * * * *

Designated country end product, * * *

The term refers to a product offered for

purchase under a supply contract, but for

purposes of calculating the value of the end

product includes services (except

transportation services) incidental to its

supply; provided, that the value of those

incidental services does not exceed that of

the product itself.

* * * * *

Eligible product, as used in this clause,

means a designated, North American Free

Trade Agreement (NAFTA), or Caribbean

Basin country end product.

* * * * *

NAFTA country end product, * * * The

term refers to a product offered for purchase

under a supply contract, but for purposes of

calculating the value of the end product

includes services (except transportation

services) incidental to its supply; provided,

that the value of those incidental services

does not exceed that of the product itself.

(b) * * * Contractors may not supply a

foreign end product for the line items subject

to the Trade Agreements Act unless—

(1) The foreign end product is an eligible

product (see FAR 25.401);

(2) The Contracting Officer determines that

offers of domestic end products or of eligible

products are either not received or are

insufficient to fulfill the Government’s

requirements; or

(3) A waiver is granted under section 302

of the Trade Agreements Act of 1979 (see

FAR 25.402(c)).

* * * * *

20. Section 52.225–15 is amended:

a. by revising the section and clause

headings;

b. revising ‘‘25.205(b)’’ in the

introductory text to read ‘‘25.205(b)(1)’’;

c. revising the clause date;

d. adding the definition ‘‘Designated

country construction material’’ in

alphabetical order;

e. removing the definitions ‘‘European

Community construction material’’ and

‘‘EC country’’;

f. revising paragraph (b);

g. Amending paragraph (c) by

replacing ‘‘EC’’ with ‘‘designated

country’’ and revising ‘‘materialmen’’ to

read ‘‘material men’’; and

h. adding Alternate I.

The revised and added text reads as

follows:

52.225–15 Buy American Act—

Construction Materials under Trade

Agreements Act and North American Free

Trade Agreement.

* * * * *

Buy American Act—Construction

Materials under Trade Agreements Act

and North American Free Trade (Jan.

1996)

(a) * * *

Designated country construction material

means a construction material that (a) is

wholly the growth, product, or manufacture

of a designated country (as defined at FAR

25.401), or (b) in the case of a construction

material which consists in whole or in part

of materials from another country or

instrumentality, has been substantially

transformed in a designated country into a

new and different construction material

distinct from the materials from which it was

transformed.

* * * * *

(b) The Buy American Act (41 U.S.C. 10)

provides that the Government give preference

to domestic material. In addition, the Trade

Agreements Act and the North American

Free Trade Agreement (NAFTA) provide that

designated country and NAFTA construction

materials are exempted from application of

the Buy American Act.

Alternate I (Jan 1996). As prescribed in

25.205(b)(2), substitute the following

paragraphs (b) and (c) in place of paragraphs

(b) and (c) of the basic clause:

(b) The Buy American Act (41 U.S.C. 10)

provides that the Government give preference

to domestic material. In addition, the North

American Free Trade Agreement (NAFTA)

provides that NAFTA construction materials

are exempted from application of the Buy

American Act.

(c) The Contractor agrees that only

domestic construction materials or NAFTA

country construction materials will be used

by the Contractor, subcontractors, material

men and suppliers in the performance of this

contract, except for other foreign

construction materials, if any, listed in this

contract.

52.225–16 and 52.225–17 [Removed]

21. 52.225–16 and 52.225–17 are

removed and reserved.

22. 52.225–18 is amended:

a. by revising the section and clause

headings;

b. by revising the clause date;

c. in paragraph (a), in the definition

‘‘Sanctioned European Community (EC)

end product’’ by revising ‘‘European

Community’’ to read ‘‘European Union’’,

revising ‘‘EC’’ to read ‘‘EU’’ (3 times),

revising the second sentence, and

removing the third sentence;

d. in the definition ‘‘Sanctioned

member state of the EC’’ ‘‘EC’’ is revised

to read ‘‘EU’’;

e. in paragraph (b) by revising ‘‘EC’’

to read ‘‘EU’’. The revised text reads as

follows:

52.225–18 European Union Sanction for

End Products.

* * * * *

European Union Sanction for End

Products (Jan 1996)

* * * * *

(a) * * *

* * * * *

Sanctioned European Union (EU) end

product * * * The term refers to a product

offered for purchase under a supply contract,

but for purposes of calculating the value of

the end product includes services (except

transportation services) incidental to its

supply; provided, that the value of these

incidental services does not exceed that of

the product itself.

* * * * *

23. Section 52.225–19 is amended by

revising the section and clause

headings, revising the clause date, in

paragraph (a) by removing ‘‘Community

(EC)’’ and inserting in its place ‘‘Union

(EU)’’, and revising the term ‘‘EC’’ to

read ‘‘EU’’ in paragraph (b). The revised

headings and date appear below.

52.225–19 European Union Sanction for

Services.

* * * * *

European Union Sanction for Services

(Jan 1996)

* * * * *

24. 52.225–21 is amended by revising

the clause date; in paragraph (a), in the

definition ‘‘NAFTA country end

product,’’ by revising the second

sentence and removing the third

sentence; and by removing paragraph

(d) and redesignating paragraph ‘‘(e)’’ as

‘‘(d)’’. The revised text reads as follows:

52.225–21 Buy American Act—North

American Free Trade Agreement

Implementation Act—Balance of Payments

Program.

* * * * *

Buy American Act—North American

Free Trade Agreement Implementation

Act—Balance of Payments Program (Jan

1996)

(a) Definitions. * * *

* * * * *

NAFTA country end product * * * The

term refers to a product offered for purchase

under a supply contract, but for purposes of

calculating the value of the end product

includes services (except transportation

services) incidental to its supply; provided,

that the value of those incidental services

does not exceed that of the product itself.

* * * * *

[FR Doc. 95–31466 Filed 12–28–95; 8:45 am]

BILLING CODE 6820–EP–M