25.502 Application
Source: FAR 25.502 on acquisition.gov
FAR 25.502 mandates a structured, preference-driven process for evaluating and awarding supply contracts involving foreign and domestic products, ensuring compliance with Buy American and trade agreement requirements.
Overview
FAR 25.502 outlines the step-by-step process for evaluating offers in supply contracts involving foreign and domestic products, particularly under the Buy American statute, Free Trade Agreements (FTAs), the Israeli Trade Act, and the WTO Government Procurement Agreement (GPA). It provides a structured approach for eliminating unacceptable offers, ranking by price, applying evaluation factors, and determining award decisions based on the origin of end products and applicable trade agreements. The section also addresses tie-breaking procedures between domestic and foreign offers, ensuring compliance with statutory preferences and agency procedures.
Key Rules
- Offer Evaluation Sequence
- Eliminate unacceptable offers (e.g., nonresponsive, debarred, prohibited sources), then rank remaining offers by price, and apply evaluation factors if required.
- WTO GPA Acquisitions
- Only consider U.S.-made or designated country end products unless unavailable; follow specific award and nonavailability procedures.
- Non-WTO GPA Acquisitions (Buy American/FTA/Israeli Trade Act)
- Award to the lowest domestic or eligible offer; if not available, follow prescribed steps for noneligible offers and apply evaluation factors as needed.
- Tie-Breaking Procedures
- Prefer domestic offers in ties with foreign offers; otherwise, resolve ties by drawing lots or as specified for small business concerns.
Responsibilities
- Contracting Officers: Must follow the prescribed evaluation and award sequence, apply appropriate evaluation factors, and document nonavailability determinations.
- Contractors: Ensure offers are compliant, responsive, and clearly identify product origin and eligibility under relevant statutes or agreements.
- Agencies: Oversee adherence to evaluation procedures and maintain impartiality in tie-breaking.
Practical Implications
- This section ensures fair and consistent evaluation of foreign and domestic offers, supporting statutory preferences and trade obligations.
- Contractors must understand eligibility requirements and documentation to avoid disqualification.
- Common pitfalls include misapplying evaluation factors, failing to document nonavailability, or incorrectly resolving ties.
(a) Unless otherwise specified in agency regulations, perform the following steps in the order presented:
(1) Eliminate all offers or offerors that are unacceptable for reasons other than price; e.g., nonresponsive, debarred or suspended, or a prohibited source (see subpart 25.7).
(2) Rank the remaining offers by price.
(3) If the solicitation specifies award on the basis of factors in addition to cost or price, apply the evaluation factors as specified in this section and use the evaluated cost or price in determining the offer that represents the best value to the Government.
(b) For acquisitions covered by the WTO GPA (see subpart 25.4)-
(1) Consider only offers of U.S.-made or designated country end products, unless no offers of such end products were received;
(2) If the agency gives the same consideration given eligible offers to offers of U.S.-made end products that are not domestic end products, award on the low offer. Otherwise, evaluate in accordance with agency procedures; and
(3) If there were no offers of U.S.-made or designated country end products, make a nonavailability determination (see 25.103(b)(2)) and award on the low offer (see 25.403(c)).
(c) For acquisitions not covered by the WTO GPA, but subject to the Buy American statute (an FTA or the Israeli Trade Act also may apply), the following applies:
(1) If the low offer is a domestic offer or an eligible offer under an FTA or the Israeli Trade Act, award on that offer.
(2) If the low offer is a noneligible offer and there were no domestic offers (see 25.103(b)(3)), award on the low offer. The procedures at 25.106(b)(2) and 25.106(c)(2) do not apply.
(3) If the low offer is a noneligible offer and there is an eligible offer that is lower than the lowest domestic offer, award on the low offer. The procedures at 25.106(b)(2) and 25.106(c)(2) do not apply.
(4) Otherwise, apply the appropriate evaluation factor provided in 25.106 to the low offer. The procedures at 25.106(b)(2) and 25.106(c)(2) do not apply.
(i) If the evaluated price of the low offer remains less than the lowest domestic offer, award on the low offer.
(ii) If the price of the lowest domestic offer is less than the evaluated price of the low offer, award on the lowest domestic offer.
(d) Ties.
(1) If application of an evaluation factor results in a tie between a domestic offer and a foreign offer, award on the domestic offer.
(2) If no evaluation preference was applied (i.e., offers afforded nondiscriminatory treatment under the Buy American statute), resolve ties between domestic and foreign offers by a witnessed drawing of lots by an impartial individual.
(3) Resolve ties between foreign offers from small business concerns (under the Buy American statute, a small business offering a manufactured article that does not meet the definition of "domestic end product" is a foreign offer) or foreign offers from a small business concern and a large business concern in accordance with 14.408-6(a).