25.401 Exceptions
Source: FAR 25.401 on acquisition.gov
FAR 25.401 identifies specific acquisitions and services that are exempt from trade agreement requirements, ensuring contracting professionals apply Subpart 25.4 only when appropriate.
Overview
FAR 25.401 outlines specific exceptions to the applicability of Subpart 25.4, which governs trade agreements in federal acquisitions. This section details when the requirements of Subpart 25.4 do not apply, including certain types of acquisitions and specific services excluded under various trade agreements. It provides a table listing services that are excluded from coverage under the World Trade Organization Government Procurement Agreement (WTO GPA) and various Free Trade Agreements (FTAs), clarifying which services and acquisitions are exempt from trade agreement procedures.
Key Rules
- General Exceptions
- Subpart 25.4 does not apply to acquisitions set aside for small businesses, national security-related purchases, end products for resale, certain Federal Prison Industries and nonprofit agency acquisitions, non-competitive acquisitions under specific FAR subparts, and goods/services excluded by individual trade agreements.
- Service Exclusions by Trade Agreement
- The section provides a detailed table of services (e.g., military support, telecommunications, dredging, R&D, transportation, utilities, ship repair) that are excluded from coverage under the WTO GPA and various FTAs, with exclusions varying by agreement and service type.
Responsibilities
- Contracting Officers: Must determine if an acquisition falls under any of the listed exceptions before applying Subpart 25.4 procedures; must consult the table and agency regulations for service exclusions.
- Contractors: Should be aware of exceptions that may affect eligibility or requirements for certain procurements, especially regarding trade agreement coverage.
- Agencies: Must maintain awareness of agency-specific exclusions and supplementary regulations negotiated under trade agreements.
Practical Implications
- This section helps contracting professionals quickly identify when trade agreement requirements do not apply, avoiding unnecessary compliance steps. Misapplying Subpart 25.4 can lead to procurement delays or compliance issues. Common pitfalls include overlooking service exclusions or failing to recognize set-aside or national security exceptions.
(a) This subpart does not apply to-
(1) Acquisitions set aside for small businesses;
(2) Acquisitions of arms, ammunition, or war materials, or purchases indispensable for national security or for national defense purposes;
(3) Acquisitions of end products for resale;
(4) Acquisitions from Federal Prison Industries, Inc., under subpart 8.6, and acquisitions under subpart 8.7, Acquisition from Nonprofit Agencies Employing People Who Are Blind or Severely Disabled;
(5) Other acquisitions not using full and open competition, if authorized by subpart 6.2 or 6.3, when the limitation of competition would preclude use of the procedures of this subpart; or sole source acquisitions justified in accordance with 13.501(a); and
(6) Goods and services specifically excluded under individual trade agreements, such as exceptions negotiated by the U.S. Trade Representative for particular agencies. See the agency supplementary regulations.
(b) In the World Trade Organization Government Procurement Agreement (WTO GPA) and each FTA, there is a U.S. schedule that lists services that are excluded from that agreement in acquisitions by the United States. Acquisitions of the following services are excluded from coverage by the U.S. schedule of the WTO GPA or an FTA as indicated in this table:
|
The Service (Federal Service Codes from the Federal Procurement Data System Product/Service Code Manual are indicated in paren-theses for some services.) |
WTO GPA and KOREA FTA |
Bahrain FTA, CAFTA-DR, Chile FTA, Columbia FTA, USMCA, Oman FTA, Panama FTA, and Peru FTA |
Singapore FTA |
Australia and Morocco FTA |
|
|
(1) |
All services purchased in support of military services overseas. |
X |
X |
X |
X |
|
(2) |
(i) Automatic data processing (ADP) telecommunications and transmission services (D304), except enhanced (i.e., value-added) telecommunications services. |
X |
X |
||
| (ii) ADP teleprocessing and timesharing services (D305), telecommunications network management services (D316), automated news services, data services or other information services (D317), and other ADP and telecommunications services (D399). |
X |
X |
|||
| (iii) Basic telecommunications network services ( i.e., voice telephone services, packet-switched data transmission services, circuit-switched data transmission services, telex services, facsimile services, and private leased circuit services, but not information services, as defined in 47 U.S.C.153(24)). |
* |
* |
X |
X |
|
|
(3) |
Dredging. |
X |
X |
X |
X |
|
(4) |
(i) Operation and management contracts of certain Government or privately owned facilities used for Government purposes, including Federally Funded Research and Development Centers. |
X |
X |
||
| (ii) Operation of all Department of Defense, Department of Energy, or the National Aeronautics and Space Administration facilities; and all Government-owned research and development facilities or Government-owned environmental laboratories. |
** |
X |
** |
X |
|
|
(5) |
Research and development. |
X |
X |
X |
X |
|
(6) |
Transportation services (including launching services, but not including travel agent services). |
X |
X |
X |
X |
|
(7) |
Utility services. |
X |
X |
X |
X |
|
(8) |
Maintenance, repair, modification, rebuilding and installation of equipment related to ships (J019). |
X |
X |
||
|
(9) |
Nonnuclear ship repair (J998). |
X |
X |
* Note1. Acquisitions of the services listed at (2)(iii) of this table are a subset of the excluded services at (2)(i) and (ii), and are therefore not covered under the WTO GPA.
** Note2. Acquisitions of the services listed at (4)(ii) of this table are a subset of the excluded services at (4)(i), and are therefore not covered under the WTO GPA.