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

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

Last week, President Trump issued an executive order aimed at encouraging the expansion American manufacturing of essential medical products — Executive Order on Ensuring Essential Medicines, Medical Countermeasures, and Critical Inputs Are Made in the United States (August 6, 2020) (the “Order”).  The Order sets forth an ambitious plan requiring extensive agency action on a tight timeline that suggests a significant impact.  Closer examination of the Order raises significant questions about the practicalities of implementation and the realistic impact of the Order once the substantial stated exceptions are taken into account.

The List

The heart of the Order is a list of Essential Medicines, Medical Countermeasures (“MCMs”), and Critical Inputs to which the Order’s requirements apply — but the key components of this list do not yet exist.  Instead, the Order directs the Food and Drug Administration (“FDA”) to produce the list within 90 days and to include on the list Essential Medicines, MCMs, and Critical Inputs “that are medically necessary to have available at all times in an amount adequate to serve patient needs and in the appropriate dosage forms.”

The Order provides the following definitions that give some insight into what may be on the FDA’s eventual list:
Continue Reading Trump Administration Increases Uncertainty for Pharmaceutical Manufacturing

[This article was originally published in Law360.]

President Trump took a significant step this week towards implementing his often touted objective of protecting U.S. manufacturers and workers by signing the “Presidential Executive Order on Buy American and Hire American” (the “EO”) on April 18, 2017.  In addition to addressing reforms to the H1-B visa program to protect U.S. workers, the EO sets forth a policy and action plan intended to “support the American manufacturing and defense industrial bases” by “maximiz[ing]” the Federal Government’s procurement of “goods, products, and materials produced in the United States,” and mandates strict compliance with the statutory and regulatory regimes for domestic sourcing preferences and restrictions (jointly referred to as “Buy American Laws”), such as the Buy American Act (41 U.S.C. §§ 8301–8305) and other buy America legislation, and implementing regulations.

In short, and as to procurement, the EO:

  • Requires all agencies to assess their monitoring, enforcement, implementation, and compliance with Buy American Laws and the use of waivers to those laws, and to propose policies designed to ensure that the use of domestic sources is maximized, consistent with existing law.
  • Requires an assessment of the impact on domestic procurement preferences of all free trade agreements and the World Trade Organization Agreement on Government Procurement.
  • Elevates to the Head of the Agency the granting of any public interest waivers to Buy American Laws requirements and requires such determinations to consider whether the cost advantage of the foreign product is due to dumping or the use of an injuriously subsidized product.
  • Requires the Secretary of Commerce to submit a report to President Trump within 220 days of the date of the EO which shall include “specific recommendations to strengthen implementation of Buy American Laws, including domestic procurement preference policies and programs.”
  • Requires agencies to submit annual reports to the Secretary of Commerce and the Director of the Office of Management and Budget on agency efforts to maximize the procurement of domestic products, and requires the Secretary of Commerce to submit an annual report to the President based on the agency submissions.

Although this EO establishes the Administration’s policy to strictly enforce Buy American Laws to maximize the use of domestic manufacturers and labor, it does not change existing law or regulation.[1]

Here are our key takeaways.

Continue Reading Key Takeaways From President Trump’s “Buy American” Executive Order