DFARS 252.225-7036 Buy American—Free Trade Agreements--Balance of Payments Program

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Prescribed in 225.1101(10)(i)
Effective Date:	1 November 2014
Clause or Provision:	Clause
Provision or Clause Number:	S 252.225-7036 Buy American—Free Trade Agreements--Balance of Payments Program
Principle Type And/Or Purpose of Contract:
Required:
Applicable:
Optional:
Subject:
ProcurementType:
Contract Threshold:
Prescription Overview:	Prescription (10)(i) Except as provided in paragraph (10)(ii) of this section, use the basic or an alternate of the clause at 252.225-7036, Buy American—Free Trade Agreements— Balance of Payments Program, instead of the clause at FAR 52.225-3, Buy American—Free Trade Agreements–Israeli Trade Act, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial items, for the items listed at 225.401-70, when the estimated value equals or exceeds $25,000, but is less than $204,000, unless an exception at 25.401 applies. (A) Use the basic clause in solicitations and contracts when the estimated value equals or exceeds $79,507, except if the acquisition is of end products in support of operations in Afghanistan. (B) Use the alternate I clause in solicitations and contracts when the estimated value is less than $79,507, except if the acquisition is of end products in support of operations in Afghanistan. (C) Use the alternate II clause in solicitations and contracts when the estimated value equals or exceeds $100,000 and the acquisition is of end products in support of operations in Afghanistan. (D) Use the alternate III clause in solicitations and contracts when the estimated value is less than $79,507 and the acquisition is of end products in support of operations in Afghanistan. (E) Use the alternate IV clause in solicitations and contracts when the estimated value equals or exceeds $79,507 but is less than $100,000, except if the acquisition is of end products in support of operations in Afghanistan. (F) Use the alternate V clause in solicitations and contracts when the estimated value equals or exceeds $79,507 but is less than $100,000 and the acquisition is of end products in support of operations in Afghanistan. (ii) Do not use the basic or an alternate of the clause in paragraph (10)(i) of this section if— (A) Purchase from foreign sources is restricted (see 225.401(a)(2)), unless the contracting officer anticipates a waiver of the restriction; (B) Acquiring information technology that is a commercial item, using fiscal year 2004 or subsequent funds (Section 535 of Division F of the Consolidated Appropriations Act, 2004 (Pub. L. 108-199), and the same provision in subsequent appropriations acts); or (C) Using a procedure specified in 225.7703-1(a). (iii) The acquisition of eligible and noneligible products under the same contract may result in the application of a Free Trade Agreement to only some of the items acquired. In such case, indicate in the Schedule those items covered by the Buy American—Free Trade Agreements—Balance of Payments Program clause.
Clause Overview:	Clause BUY AMERICAN—FREE TRADE AGREEMENTS—BALANCE OF PAYMENTS PROGRAM—BASIC (NOV 2014) (a) Definitions As used in this clause— “Bahrainian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Bahrain; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Commercially available off-the-shelf (COTS) item”— (i) Means any item of supply (including construction material) that is— (A) A commercial item (as defined in paragraph (1) of the definition of “commercial item” in section 2.101 of the Federal Acquisition Regulation); (B) Sold in substantial quantities in the commercial marketplace; and (C) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and (ii) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products. “Component” means an article, material, or supply incorporated directly into an end product. “Domestic end product” means— (i) An unmanufactured end product that has been 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 50 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). 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. “End product” means those articles, materials, and supplies to be acquired under this contract for public use. “Foreign end product” means an end product other than a domestic end product. “Free Trade Agreement country” means Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore; “Free Trade Agreement country end product” means an article that— (i) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Moroccan end product” means an article that— (i) Is wholly the growth, product, or manufacture of Morocco; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Panamanian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Panama; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Peruvian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Peru ; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Qualifying country” means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries: Australia Austria Belgium Canada Czech Republic Denmark Egypt Finland France Germany Greece Israel Italy Luxembourg Netherlands Norway Poland Portugal Spain Sweden Switzerland Turkey United Kingdom of Great Britain and Northern Ireland. “Qualifying country component” means a component mined, produced, or manufactured in a qualifying country. “Qualifying country end product” means— (i) An unmanufactured end product mined or produced in a qualifying country; or (ii) An end product manufactured in a qualifying country if— (A) The cost of the following types of components exceeds 50 percent of the cost of all its components: (1) Components mined, produced, or manufactured in a qualifying country. (2) Components mined, produced, or manufactured in the United States. (3) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or (B) The end product is a COTS item. “United States” means the 50 States, the District of Columbia, and outlying areas. (b) Unless otherwise specified, this clause applies to all items in the Schedule. (c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, Free Trade Agreement country end products other than Bahrainian end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Basic provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or a Free Trade Agreement country end product other than a Bahrainian end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, a Free Trade Agreement country end product other than a Bahrainian end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, or, at the Contractor’s option, a domestic end product. (d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry. Alternate I As prescribed in 225.1101(10)(i)(B), use the following clause, which adds “Canadian end product” to paragraph (a), and uses a different paragraph (c) than the basic clause: BUY AMERICAN—FREE TRADE AGREEMENTS—BALANCE OF PAYMENTS PROGRAM—ALTERNATE I (NOV 2014) (a) Definitions As used in this clause— “Bahrainian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Bahrain; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Canadian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Canada; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in 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 the value of the product itself. “Commercially available off-the-shelf (COTS) item”— (i) Means any item of supply (including construction material) that is— (A) A commercial item (as defined in paragraph (1) of the definition of “commercial item” in section 2.101 of the Federal Acquisition Regulation); (B) Sold in substantial quantities in the commercial marketplace; and (C) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and (ii) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products. “Component” means an article, material, or supply incorporated directly into an end product. “Domestic end product” means— (i) An unmanufactured end product that has been 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 50 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). 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. “End product” means those articles, materials, and supplies to be acquired under this contract for public use. “Foreign end product” means an end product other than a domestic end product. “Free Trade Agreement country” means Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore; “Free Trade Agreement country end product” means an article that— (i) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Moroccan end product” means an article that— (i) Is wholly the growth, product, or manufacture of Morocco; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Panamanian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Panama; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Peruvian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Peru; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Qualifying country” means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries: Australia Austria Belgium Canada Czech Republic Denmark Egypt Finland France Germany Greece Israel Italy Luxembourg Netherlands Norway Poland Portugal Spain Sweden Switzerland Turkey United Kingdom of Great Britain and Northern Ireland. “Qualifying country component” means a component mined, produced, or manufactured in a qualifying country. “Qualifying country end product” means— (i) An unmanufactured end product mined or produced in a qualifying country; or (ii) An end product manufactured in a qualifying country if— (A) The cost of the following types of components exceeds 50 percent of the cost of all its components: (1) Components mined, produced, or manufactured in a qualifying country. (2) Components mined, produced, or manufactured in the United States. (3) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or (B) The end product is a COTS item. “United States” means the 50 States, the District of Columbia, and outlying areas. (b) Unless otherwise specified, this clause applies to all items in the Schedule. (c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country, Canadian, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate I provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or a Canadian end product, the Contractor shall deliver a qualifying country end product, a Canadian end product, or, at the Contractor’s option, a domestic end product. (d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry. Alternate II As prescribed in 225.1101(10)(i)(C), use the following clause, which adds “South Caucasus/Central and South Asian (SC/CASA) state” and “South Caucasus/Central and South Asian (SC/CASA) state end product” to paragraph (a), and uses a different paragraph (c) than the basic clause: BUY AMERICAN—FREE TRADE AGREEMENTS—BALANCE OF PAYMENTS PROGRAM—ALTERNATE II (NOV 2014) (a) Definitions As used in this clause— “Bahrainian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Bahrain; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Commercially available off-the-shelf (COTS) item”— (i) Means any item of supply (including construction material) that is— (A) A commercial item (as defined in paragraph (1) of the definition of “commercial item” in section 2.101 of the Federal Acquisition Regulation); (B) Sold in substantial quantities in the commercial marketplace; and (C) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and (ii) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products. “Component” means an article, material, or supply incorporated directly into an end product. “Domestic end product” means— (i) An unmanufactured end product that has been 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 50 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). 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. “End product” means those articles, materials, and supplies to be acquired under this contract for public use. “Foreign end product” means an end product other than a domestic end product. “Free Trade Agreement country” means Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore; “Free Trade Agreement country end product” means an article that— (i) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Moroccan end product” means an article that— (i) Is wholly the growth, product, or manufacture of Morocco; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Panamanian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Panama; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Peruvian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Peru; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Qualifying country” means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries: Australia Austria Belgium Canada Czech Republic Denmark Egypt Finland France Germany Greece Israel Italy Luxembourg Netherlands Norway Poland Portugal Spain Sweden Switzerland Turkey United Kingdom of Great Britain and Northern Ireland. “Qualifying country component” means a component mined, produced, or manufactured in a qualifying country. “Qualifying country end product” means— (i) An unmanufactured end product mined or produced in a qualifying country; or (ii) An end product manufactured in a qualifying country if— (A) The cost of the following types of components exceeds 50 percent of the cost of all its components: (1) Components mined, produced, or manufactured in a qualifying country. (2) Components mined, produced, or manufactured in the United States. (3) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or (B) The end product is a COTS item. “South Caucasus/Central and South Asian (SC/CASA) state” means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan. “South Caucasus/Central and South Asian (SC/CASA) state end product” means an article that— (i) Is wholly the growth, product, or manufacture of an SC/CASA state; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “United States” means the 50 States, the District of Columbia, and outlying areas. (b) Unless otherwise specified, this clause applies to all items in the Schedule. (c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, Free Trade Agreement country end products other than Bahrainian end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate II provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, SC/CASA state end products, or a Free Trade Agreement country end product other than a Bahrainian end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, a Free Trade Agreement country end product other than a Bahrainian end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product or, at the Contractor’s option, a domestic end product. (d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry. Alternate III As prescribed in 225.1101(10)(i)(D), use the following clause, which adds “Canadian end product,” “South Caucasus/Central and South Asian (SC/CASA) state,” and “South Caucasus/Central and South Asian (SC/CASA) state end product” to paragraph (a) and uses a different paragraph (c) than the basic clause: BUY AMERICAN—FREE TRADE AGREEMENTS—BALANCE OF PAYMENTS PROGRAM—ALTERNATE III (NOV 2014) (a) Definitions As used in this clause— “Bahrainian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Bahrain; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Canadian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Canada; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in 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 the value of the product itself. “Commercially available off-the-shelf (COTS) item”— (i) Means any item of supply (including construction material) that is— (A) A commercial item (as defined in paragraph (1) of the definition of “commercial item” in section 2.101 of the Federal Acquisition Regulation); (B) Sold in substantial quantities in the commercial marketplace; and (C) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and (ii) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products. “Component” means an article, material, or supply incorporated directly into an end product. “Domestic end product” means— (i) An unmanufactured end product that has been 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 50 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). 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. “End product” means those articles, materials, and supplies to be acquired under this contract for public use. “Foreign end product” means an end product other than a domestic end product. “Free Trade Agreement country” means Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore; “Free Trade Agreement country end product” means an article that— (i) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Moroccan end product” means an article that— (i) Is wholly the growth, product, or manufacture of Morocco; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Panamanian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Panama; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Peruvian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Peru; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Qualifying country” means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries: Australia Austria Belgium Canada Czech Republic Denmark Egypt Finland France Germany Greece Israel Italy Luxembourg Netherlands Norway Poland Portugal Spain Sweden Switzerland Turkey United Kingdom of Great Britain and Northern Ireland. “Qualifying country component” means a component mined, produced, or manufactured in a qualifying country. “Qualifying country end product” means— (i) An unmanufactured end product mined or produced in a qualifying country; or (ii) An end product manufactured in a qualifying country if— (A) The cost of the following types of components exceeds 50 percent of the cost of all its components: (1) Components mined, produced, or manufactured in a qualifying country. (2) Components mined, produced, or manufactured in the United States. (3) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or (B) The end product is a COTS item. “South Caucasus/Central and South Asian (SC/CASA) state” means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan. “South Caucasus/Central and South Asian (SC/CASA) state end product” means an article that— (i) Is wholly the growth, product, or manufacture of an SC/CASA state; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “United States” means the 50 States, the District of Columbia, and outlying areas. (b) Unless otherwise specified, this clause applies to all items in the Schedule. (c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, Canadian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate III provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, SC/CASA state end products, or a Canadian end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, a Canadian end product or, at the Contractor’s option, a domestic end product. (d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry. Alternate IV As prescribed in 225.1101(10)(i)(E), use the following clause, which adds “Korean end product” to paragraph (a), and uses a different paragraph (c) than the basic clause: BUY AMERICAN—FREE TRADE AGREEMENTS—BALANCE OF PAYMENTS PROGRAM—ALTERNATE IV (NOV 2014) (a) Definitions As used in this clause— “Bahrainian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Bahrain; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Commercially available off-the-shelf (COTS) item”— (i) Means any item of supply (including construction material) that is— (A) A commercial item (as defined in paragraph (1) of the definition of “commercial item” in section 2.101 of the Federal Acquisition Regulation); (B) Sold in substantial quantities in the commercial marketplace; and (C) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and (ii) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products. “Component” means an article, material, or supply incorporated directly into an end product. “Domestic end product” means— (i) An unmanufactured end product that has been 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 50 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). 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. “End product” means those articles, materials, and supplies to be acquired under this contract for public use. “Foreign end product” means an end product other than a domestic end product. “Free Trade Agreement country” means Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore; “Free Trade Agreement country end product” means an article that— (i) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Korean end product” means an article that— (i) Is wholly the growth, product, or manufacture of Korea; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Korea (Republic of) into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Moroccan end product” means an article that— (i) Is wholly the growth, product, or manufacture of Morocco; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Panamanian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Panama; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Peruvian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Peru; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. "Qualifying country” means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries: Australia Austria Belgium Canada Czech Republic Denmark Egypt Finland France Germany Greece Israel Italy Luxembourg Netherlands Norway Poland Portugal Spain Sweden Switzerland Turkey United Kingdom of Great Britain and Northern Ireland. “Qualifying country component” means a component mined, produced, or manufactured in a qualifying country. “Qualifying country end product” means— (i) An unmanufactured end product mined or produced in a qualifying country; or (ii) An end product manufactured in a qualifying country if— (A) The cost of the following types of components exceeds 50 percent of the cost of all its components: (1) Components mined, produced, or manufactured in a qualifying country. (2) Components mined, produced, or manufactured in the United States. (3) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or (B) The end product is a COTS item. “United States” means the 50 States, the District of Columbia, and outlying areas. (b) Unless otherwise specified, this clause applies to all items in the Schedule. (c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, Free Trade Agreement country end products other than Bahrainian end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate IV provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or a Free Trade Agreement country end product other than a Bahrainian end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, a Free Trade Agreement country end product other than a Bahrainian end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, or, at the Contractor’s option, a domestic end product. (d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry. Alternate V As prescribed in 225.1101(10)(i)(F), use the following clause, which adds “Korean end product,” “South Caucasus/Central and South Asian (SC/CASA) state,” and “South Caucasus/Central and South Asian (SC/CASA) state end product” to paragraph (a), and uses a different paragraph (c) than the basic clause: BUY AMERICAN—FREE TRADE AGREEMENTS—BALANCE OF PAYMENTS PROGRAM—ALTERNATE V (NOV 2014) (a) Definitions As used in this clause— “Bahrainian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Bahrain; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Commercially available off-the-shelf (COTS) item”— (i) Means any item of supply (including construction material) that is— (A) A commercial item (as defined in paragraph (1) of the definition of “commercial item” in section 2.101 of the Federal Acquisition Regulation); (B) Sold in substantial quantities in the commercial marketplace; and (C) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and (ii) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products. “Component” means an article, material, or supply incorporated directly into an end product. “Domestic end product” means— (i) An unmanufactured end product that has been 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 50 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). 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. “End product” means those articles, materials, and supplies to be acquired under this contract for public use. “Foreign end product” means an end product other than a domestic end product. “Free Trade Agreement country” means Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore; “Free Trade Agreement country end product” means an article that— (i) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Korean end product” means an article that— (i) Is wholly the growth, product, or manufacture of Korea; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Korea (Republic of) into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. "Moroccan end product” means an article that— (i) Is wholly the growth, product, or manufacture of Morocco; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Panamanian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Panama; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Peruvian end product” means an article that— (i) Is wholly the growth, product, or manufacture of Peru; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “Qualifying country” means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries: Australia Austria Belgium Canada Czech Republic Denmark Egypt Finland France Germany Greece Israel Italy Luxembourg Netherlands Norway Poland Portugal Spain Sweden Switzerland Turkey United Kingdom of Great Britain and Northern Ireland. “Qualifying country component” means a component mined, produced, or manufactured in a qualifying country. “Qualifying country end product” means— (i) An unmanufactured end product mined or produced in a qualifying country; or (ii) An end product manufactured in a qualifying country if— (A) The cost of the following types of components exceeds 50 percent of the cost of all its components: (1) Components mined, produced, or manufactured in a qualifying country. (2) Components mined, produced, or manufactured in the United States. (3) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or (B) The end product is a COTS item. “South Caucasus/Central and South Asian (SC/CASA) state” means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan. “South Caucasus/Central and South Asian (SC/CASA) state end product” means an article that— (i) Is wholly the growth, product, or manufacture of an SC/CASA state; or (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself. “United States” means the 50 States, the District of Columbia, and outlying areas. (b) Unless otherwise specified, this clause applies to all items in the Schedule. (c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, Free Trade Agreement country end products other than Bahrainian end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate V provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, SC/CASA state end products, or a Free Trade Agreement country end product other than a Bahrainian end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, a Free Trade Agreement country end product other than a Bahrainian end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product or, at the Contractor’s option, a domestic end product. (d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.
Important Notes/Requirements:
Subcontract Threshold:
Incorporated by Reference:	Yes
Uniform Contract Format:
Editor:	Marshall

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Personal notes.