On November 4, 2022, the U.S. Department of Transportation (“DOT”) published two proposed waiver notices with request for comments related to the Bipartisan Infrastructure Law’s Build America, Buy America Act (“BABA”).  Both notices stated that DOT’s existing temporary waiver for construction materials would not be extended past its expiration on November 10, 2022.  One notice proposes a public interest waiver for certain narrow categories of contracts and solicitations to continue transitioning the construction materials standard.  The other notice proposes a public interest waiver for de minimis costs, small grants, and minor components.  Comments are due November 20, 2022 for both notices.

Continue Reading Department of Transportation Issues Two Proposed Waiver Notices for Build America, Buy America

Last December, President Biden issued Executive Order 14057, “Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability,” which directed the government to adopt cleaner and more sustainable procurement practices, with the ultimate objective of net-zero emissions by 2050

Pursuant to that directive, GSA has issued a new RFI seeking information regarding domestically manufactured solar photovoltaic (PV) panels and systems, as well as PV system installation.  GSA intends to use the information to develop a solar PV procurement strategy and a procurement standard for use in future solicitations — including solicitations for Power Purchase Agreements (PPA), Energy Savings Performance Contracts (ESPCs), Utility Energy Service Contracts (UESCs), and other vehicles. 

Given the RFI’s emphasis on sourcing and country of origin, it is possible that any new procurement standards for civilian contracting would parallel existing regulations at DFARS 252.225-7017, which generally require DoD contractors to make use of PV devices originating from the United States or certain designated or qualifying countries.  Of course, the ultimate impact of the RFI on future procurement strategy remains to be seen.  What is certain, however, is that the Administration is committed to clean technology procurements and that domestic preferences remain an overriding and central concern. 

Comments in response to the RFI are due by November 18, 2022.  More detail about specific topics covered in the RFI is below.

Continue Reading GSA Issues Request for Information on Photovoltaic Systems

On December 30, 2021, the FAR Council issued a final rule to update the trade agreements thresholds implemented under the Trade Agreements Act (“TAA”).  The new thresholds take effect January 1, 2022.

The TAA thresholds are adjusted every two years and set the value a contract must meet or exceed in order for the World Trade Organization Government Procurement Agreement (“WTO GPA”) and free trade agreements (“FTAs”) to apply.  For supply, service, and construction contracts that meet or exceed the stated thresholds, Buy American Act (“BAA”) requirements are waived in accordance with the TAA, and the Government is required to treat eligible products and services from designated countries on an equal basis as domestic products and services.

The updated thresholds, to be listed in FAR 25.402(b), are provided below.

Continue Reading New Trade Agreements Act Thresholds Take Effect January 1, 2022

Under the January 2021 “Made in America” Executive Order 14005, President Biden established a new Made in America Office to oversee and administer domestic preference requirements in federal procurements.  Housed within the Office of Management and Budget (“OMB”), the Made in America Office was tasked with, among other things, reviewing and approving agency waivers of any Made in America Laws—including, for example, waivers of the Buy American Act (“BAA”) and Trade Agreements Act (“TAA”), as well as developing a publicly available website to post the descriptions of the proposed waivers and justifications for each.  Last week, the Made in America Office launched its new website, establishing for the first time a centralized, government-wide database of all proposed waivers of Made in America Laws.

Continue Reading The Made in America Office Website Is Live

Last month, the Biden administration released its report on the results of its 100-day review of U.S. supply chains for critical products:  “Building Resilient Supply Chains, Revitalizing American Manufacturing, and Fostering Broad-Based Growth” (the “Report”).  Alongside the Report’s slate of policy recommendations, the Biden administration also announced immediate actions to strengthen supply chains and stimulate domestic competitiveness.

The Report is the result of President Biden’s February 24 “Executive Order on America’s Supply Chains” (the “Order”), which directed federal departments and agencies to conduct a review of supply chain risks in four critical product areas,[1] including pharmaceuticals and active pharmaceutical ingredients (“APIs”).  The Report and its recommendations further the Biden administration’s broader goal of rebuilding the U.S. industrial base, reducing reliance on foreign competitors, and bolstering national and economic security.

The U.S. Department of Health and Human Services (“HHS”) led the review of the supply chain for pharmaceuticals and APIs, which focused primarily on drugs, in particular small-molecule drugs and therapeutic biological products.  The Report makes a number of recommendations discussed herein that have the potential to impact pharmaceutical companies’ business plans and generate significant opportunities, though many such recommendations are long-term and will require dedicated funding so the actual impact of the Report’s suggestions remains to be seen.
Continue Reading Biden Administration 100-Day Supply Chain Assessment: Insights for Pharmaceutical Manufacturers

The American Rescue Plan, signed into law last month, includes $1.9 trillion in economic stimulus, healthcare, and related funding.  And just last week the Biden administration released an infrastructure proposal, the American Jobs Plan, that includes $2.3 trillion in transportation, connectivity, power, and other critical infrastructure investments.

Contractors are right to view these plans as massive opportunities — but should be cognizant of the regulatory strings that often attach to government spending.  In general, these can include Federal Acquisition Regulation (FAR) and agency-specific FAR supplements for federal procurements, as well as the nonprocurement uniform requirements (2 C.F.R. Part 200) and related agency-specific regulations that attach to Federal grant funds even when disbursed by state or local entities.

Now, some Congressional members are seeking to add new restrictions that would significantly overhaul the existing domestic preference regime for Federal procurements — mere weeks after the promulgation of new Buy American regulations and the release of a new Executive Order to further tighten the application of these rules.

Continue Reading U.S. Senators Propose Trade-Pact Waivers Amidst Focus on Domestic Preference Laws

On February 24, 2021, President Biden signed an Executive Order entitled “Executive Order on America’s Supply Chains” (the “Order”). Among other things, the Order is an initial step toward accomplishing the Biden Administration’s goal of building more resilient American supply chains that avoid shortages of critical products, facilitate investments to maintain America’s competitive edge, and

On Monday, the U.S. Court of Appeals for the Federal Circuit issued an opinion in Acetris Health, LLC v. United States, No. 2018-2399 (Fed. Cir. Feb. 10, 2020) (“Acetris”), that would permit pharmaceutical manufacturers to source a drug’s active pharmaceutical ingredient (“API”) from India, China and other non “designated countries” and yet still offer the end product for sale to the U.S. Government.  Under the Trade Agreements Act (“TAA”), if a drug’s API was sourced from outside of the United States or a designated country, at least some Government agencies previously had taken the position that the U.S. Government could not purchase it.  In Acetris, the Federal Circuit explained that the TAA inquiry should turn not on where the API (or some other component) is sourced, but instead on where the pill (or other end product) is manufactured.  Consistent with this approach, the court held that a pill manufactured in the United States was compliant with the TAA and implementing regulations even though the pill’s API was sourced from India.

Although the full implications of the Acetris decision are not yet clear, there is no doubt that the ruling alters the TAA compliance landscape and offers broader lessons outside of the pharmaceutical manufacturing context.  Consequently, the decision warrants close attention by contractors seeking to maximize supply chain efficiency.
Continue Reading A New Path to TAA Compliance: U.S.-Made End Products in Acetris

A long-standing dispute over the approach to country of origin determinations under the Trade Agreements Act (“TAA”) may soon be resolved, as the Federal Circuit recently heard oral argument in one of two cases presently examining key aspects of this statute.  Among other questions presented, the court may decide the standard for determining whether a product may be considered a U.S.-made end product — a question that could have far reaching implications for product manufacturers across all industries.

Continue Reading How Much Is Enough? Federal Circuit Appeal May Decide Level of U.S. Manufacturing Required Under the TAA

Last week, President Trump issued a new executive order, entitled “Strengthening Buy-American Preferences for Infrastructure Projects.”  This order serves as an extension of the President’s earlier April 2017 “Buy American and Hire American” executive order, which we have previously analyzed in this space.  The April 2017 order stated that “it shall be the policy of the executive branch to buy American and hire American,” and, among other things, directed agencies to “scrupulously, monitor, enforce, and comply with” domestic preference laws (referred to by the executive order as “Buy American Laws”) and to minimize use of waivers that would permit the purchase of foreign end products.

The President’s new order continues to emphasize the importance of “the use of goods, products, and materials produced in the United States,” but is specifically directed towards infrastructure projects that are recipients of federal financial assistance awards.  As we have reported previously, federally-financed infrastructure has also been a stated area of focus for the Trump administration, although the Administration’s “Legislative Outline for Rebuilding Infrastructure in America” released last year curiously lacked any domestic preference requirements.

The new executive order makes up for this previous omission and then some:  it has the potential to affect a vast number of programs and projects, and may in fact impose domestic sourcing requirements in areas—such as internet infrastructure—that are not typically targets for domestic preferences.

Continue Reading Trump’s New Executive Order Requires Additional Buy American Preferences For Infrastructure Projects