25.103 Exceptions
Source: FAR 25.103 on acquisition.gov
FAR 25.103 allows exceptions to Buy American requirements when domestic products are unavailable, too costly, or when public interest or specific needs justify foreign acquisitions, but strict procedures and documentation are required.
Overview
FAR 25.103 outlines specific exceptions to the Buy American statute, allowing contracting officers to acquire foreign end products under certain circumstances. These exceptions include situations where domestic preference is inconsistent with public interest, when domestic products are not available in sufficient quantity or quality, when the cost of domestic products is unreasonable, for commissary resale, and for information technology that is a commercial product. The section details the procedures for class and individual nonavailability determinations, including requirements for market research, solicitation clauses, and documentation. It also clarifies when written determinations are not required and references related FAR sections for further guidance.
Key Rules
- Public Interest Exception
- The agency head can waive Buy American requirements if domestic preference is against public interest, including under certain international agreements.
- Nonavailability Exception
- If domestic products are not available in sufficient quantity or quality, foreign products may be acquired. This includes both class and individual determinations, with specific procedures for market research and documentation.
- Unreasonable Cost Exception
- If domestic products are unreasonably expensive, foreign products may be purchased, following procedures in FAR 25.106 and subpart 25.5.
- Resale Exception
- Foreign products may be purchased for commissary resale.
- Information Technology Exception
- Buy American restrictions do not apply to commercial IT products acquired with FY 2004 or later funds.
Responsibilities
- Contracting Officers: Must identify and document applicable exceptions, conduct market research, include appropriate clauses in solicitations, and submit required documentation for determinations.
- Contractors: Must comply with solicitation requirements and provide information on domestic availability if requested.
- Agencies: Oversee determinations, maintain documentation, and ensure compliance with reporting and procedural requirements.
Practical Implications
- This section provides flexibility in procurement when domestic products are unavailable, too costly, or when public interest or specific resale/IT needs exist.
- Proper documentation and adherence to procedures are critical to avoid noncompliance.
- Common pitfalls include inadequate market research, missing documentation, or failure to include required solicitation clauses.
When one of the following exceptions applies, the contracting officer may acquire a foreign end product without regard to the restrictions of the Buy American statute:
(a) Public interest. The head of the agency may make a determination that domestic preference would be inconsistent with the public interest. This exception applies when an agency has an agreement with a foreign government that provides a blanket exception to the Buy American statute.
(b) Nonavailability. The Buy American statute does not apply with respect to articles, materials, or supplies if articles, materials, or supplies of the class or kind to be acquired, either as end items or components, are not mined, produced, or manufactured in the United States in sufficient and reasonably available commercial quantities and of a satisfactory quality.
(1) Class determinations.
(i) A nonavailability determination has been made for the articles listed in 25.104. This determination does not necessarily mean that there is no domestic source for the listed items, but that domestic sources can only meet 50 percent or less of total U.S. Government and nongovernment demand.
(ii) Before acquisition of an article on the list, the procuring agency is responsible to conduct market research appropriate to the circumstances, including seeking of domestic sources. This applies to acquisition of an article as-
(A) An end product; or
(B) A significant component (valued at more than 50 percent of the value of all the components).
(iii) The determination in paragraph (b)(1)(i) of this section does not apply if the contracting officer learns at any time before the time designated for receipt of bids in sealed bidding or final offers in negotiation that an article on the list is available domestically in sufficient and reasonably available commercial quantities of a satisfactory quality to meet the requirements of the solicitation. The contracting officer must-
(A) Ensure that the appropriate Buy American statute provision and clause are included in the solicitation (see 25.1101(a), 25.1101(b), or 25.1102);
(B) Specify in the solicitation that the article is available domestically and that offerors and contractors may not treat foreign components of the same class or kind as domestic components; and
(C) Submit a copy of supporting documentation to the appropriate council identified in 1.201-1, in accordance with agency procedures, for possible removal of the article from the list.
(2) Individual determinations.
(i) The head of the contracting activity may make a determination that an article, material, or supply is not mined, produced, or manufactured in the United States in sufficient and reasonably available commercial quantities of a satisfactory quality. A determination is not required before January 1, 2030, if there is an offer for a foreign end product that exceeds 55 percent domestic content (see 25.106(b)(2) and 25.106(c)(2)).
(ii) If the contracting officer considers that the nonavailability of an article is likely to affect future acquisitions, the contracting officer may submit a copy of the determination and supporting documentation to the appropriate council identified in 1.201-1, in accordance with agency procedures, for possible addition to the list in 25.104.
(3) A written determination is not required if all of the following conditions are present:
(i) The acquisition was conducted through use of full and open competition.
(ii) The acquisition was synopsized in accordance with 5.201.
(iii) No offer for a domestic end product was received.
(c) Unreasonable cost. The contracting officer may determine that the cost of a domestic end product would be unreasonable, in accordance with 25.106 and subpart 25.5.
(d) Resale. The contracting officer may purchase foreign end products specifically for commissary resale.
(e) Information technology that is a commercial product. The restriction on purchasing foreign end products does not apply to the acquisition of information technology that is a commercial product, when using fiscal year 2004 or subsequent fiscal year funds (section 535(a) of Division F, Title V, Consolidated Appropriations Act, 2004, and similar sections in subsequent appropriations acts).