25.504-3 FTA/Israeli Trade Act
Source: FAR 25.504-3 on acquisition.gov
FAR 25.504-3 provides clear examples for evaluating offers under the FTA/Israeli Trade Act, ensuring awards are made in compliance with trade agreement rules and proper documentation is maintained.
Overview
FAR 25.504-3 provides practical examples illustrating how to evaluate offers under the Free Trade Agreements (FTA) and the Israeli Trade Act. The section demonstrates how contracting officers should determine award decisions when offers include domestic, eligible (FTA/Israeli Trade Act), and noneligible products, especially when the acquisition is not covered by the World Trade Organization Government Procurement Agreement (WTO GPA). The examples clarify when to apply evaluation factors, when to make nonavailability determinations, and how to prioritize offers based on eligibility and price.
Key Rules
- Award to Eligible Products When Lowest Offer
- If the lowest-priced offer is for an eligible product (FTA/Israeli Trade Act), the award should go to that offer.
- Nonavailability Determination When No Domestic Offer
- If no domestic offer is received and the lowest offer is noneligible, a nonavailability determination must be made before awarding to a noneligible product.
- No Evaluation Factor When Eligible Offer is Lower Than Domestic
- If an eligible offer is lower than a domestic offer, and a noneligible offer is the lowest overall, no evaluation factor is applied, and the award goes to the lowest offer.
Responsibilities
- Contracting Officers: Must evaluate offers according to FTA/Israeli Trade Act rules, apply evaluation factors appropriately, and document nonavailability determinations when required.
- Contractors: Should clearly identify the status of their products (domestic, eligible, noneligible) and understand how their offers will be evaluated.
- Agencies: Ensure compliance with trade agreement requirements and maintain proper documentation for award decisions.
Practical Implications
- This section helps contracting professionals apply trade agreement rules in real-world scenarios, reducing confusion during offer evaluation.
- It clarifies when to apply price evaluation factors and when to make nonavailability determinations, which are common sources of error.
- Understanding these examples helps avoid improper awards and ensures compliance with international trade obligations.
(a) Example 1.
| Offer A | $105,000 | Domestic end product, small business |
| Offer B | $100,000 | Eligible product |
Analysis: Since the low offer is an eligible offer, award on the low offer (see 25.502(c)(1)).
(b) Example 2.
| Offer A | $105,000 | Eligible product |
| Offer B | $103,000 | Noneligible product |
Analysis: Since the acquisition is not covered by the WTO GPA, the contracting officer can consider the noneligible offer. Since no domestic offer was received, make a nonavailability determination and award on Offer B (see 25.502(c)(2)).
(c) Example 3.
| Offer A | $105,000 | Domestic end product, large business |
| Offer B | $103,000 | Eligible product |
| Offer C | $100,000 | Noneligible product |
Analysis: Since the acquisition is not covered by the WTO GPA, the contracting officer can consider the noneligible offer. Because the eligible offer (Offer B) is lower than the domestic offer (Offer A), no evaluation factor applies to the low offer (Offer C). Award on the low offer (see 25.502(c)(3)).