On March 7, 2022, the U.S. Department of Defense (DOD), General Services Administration, and National Aeronautics and Space Administration (collectively, the Government) issued an important final rule amending the Buy American Act (BAA) requirements in the Federal Acquisition Regulation (FAR), which will go into effect on October 25, 2022.1 Although the final rule implements some of the proposals first seen in a proposed rule on the same subject published on July 31, 2021, the final rule acknowledges that it leaves much undone. Therefore, we should expect to see more changes — though, even then, all of the considerations highlighted in last year’s proposed rule may not see the light of day for some time, if ever.
The July 30, 2021, proposed rule, in furtherance of President Joe Biden’s January 25, 2021, executive order2 to encourage the use of federal procurements to support American businesses and workers, was intended to significantly strengthen the BAA requirements in the FAR.3 Sidley previously addressed this proposal in detail.
The BAA is a standard FAR provision found in many agency procurements, including procurements of pharmaceuticals and medical devices. It is normal for such procurements above the micropurchase threshold of $10,000 to contain either a BAA clause or a Trade Agreements Act (TAA) clause, also discussed below, and each of these clauses establishes country of origin requirements that can strongly affect the Government’s contract award decisions. Consequently, it is important for life sciences companies to understand what will be changing and what will remain the same, at least for the present, regarding these clauses.
To best understand what aspects of the BAA remain as they have been and what are changed, this Alert first addresses the key elements that remain the same.
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