The Trade Agreements Act was enacted to regulate trade agreements between the United States and abroad. One of the main features of the law is that it limits U.S. government procurement to products made in the U.S. or made in certain countries. These products are then called “TAA compliant”. The Trade Agreements Act (19 U.S.C. & 2501-2581) of 1979 was enacted to promote fair and open international trade, but more importantly, it implemented the requirement that the U.S. government only purchase finished products manufactured or labeled in the United States. In particular, this means that GSA can only purchase products manufactured in the United States and/or TAA compliant under a MAS program.
This requirement has again confused many MAS contract holders as to its true meaning. Trade Agreements Act 1979 (TAA), Pub.L. 96–39, 93 Stat. 144, which came into effect on July 26, 1979, codified as 19 U.S.C. 13 (19 U.S.C. §§ 2501–2581) is an act of Congress governing trade agreements negotiated between the United States and other countries under the Commerce Act of 1974. It contained the modalities for the implementation of the Tokyo Round of the General Agreement on Tariffs and Trade. However, the TAA does not restrict foreign trade outside of federal procurement. This means that you can freely sell non-TAA compliant products in the commercial market.
If you wish to temporarily offer non-TAA compliant products in any of the above categories, you will need to submit an “Add Special Item Number” (NAS) or “Add Product Change” request in eMod. This article explains what the Trade Agreements Act is, what it means for a product to be TAA compliant, and why TAA compliance is important for any company that wants to work with the government through the GSA Schedules. TaA compliant countries are the designated countries and the United States. For the full list of TAA compliant countries, see FAR, Part 25. Therefore, countries that do not comply with the TAA are countries outside this list. B for example China, Russia and North Korea. | Follow us on Google+ or Twitter for TAA & GovCon updates | Hi, I`ve read a lot about what TAA compliance is and what counts as TAA compliant devices, but I couldn`t find any information on how to start the process of getting TAA certification or on the duration or costs of the process. Could you help us? Let`s say I have a GSA contract and my product is TAA compliant. If the supplier of part of the product changes at that time, but also complies with the TAA, what should I do in this case? Could that be a problem? Can you please provide a quote on authority? I think it sounds more like a Buy American Act standard.
This exemption applies until 31 December 2020, unless amended. TAA compliance is only required for federal procurement. Government agencies cannot purchase non-TAA products for contracts exceeding the $180,000 threshold (value subject to change). Virtually all values in Annex GSA exceed the threshold, so one could say that the TAA applies to all Annexes. Named countries that are TAA compliant include: Simply put, they cannot sell products to the government that do not comply with the Trade Agreements Act. So, if you are considering competing for a GSA calendar contract, you need to evaluate the true origin of your products very carefully. And if you`re already excellent, it`s important that you comply with your TAA compliance. The idea behind this term is that the product must undergo certain significant changes (manufacturing, assembly, processing, etc.) that lead to the distinctiveness, name or use of the resulting new product. Therefore, it is assumed that a “substantially processed” product comes from the country where these transformations were carried out. For example, if you take aluminum from one country, PET (polyethylene terephthalate) from another country, and then make aluminum foil and cover it with a PET coating, the resulting aluminum lid is a “substantially processed” product. On the other hand, if you take concentrated fruit juice and then dilute it with water, the resulting product is not “substantially processed”, since no fundamentally new properties, names or uses have appeared in the process. Since compliance with the TAA is essential to maintaining any Schedule GSA contract you may have, you should always ensure that your products comply with the requirements of the Trade Agreements Act throughout the term of the contract.
Here`s a quick checklist you should follow to make sure your goods are TAA eligible: Now let`s also look at the Part B supplier that switched to Chinese components. And now, 55% of the cost of the product comes from undeclared countries, which essentially makes your product non-COMPLIANT with the TAA. A full list of TAA compliant countries is available here. I found no authority for the following statement on this website: “A product is TAA compliant if: At least 50% of its total manufacturing costs come from the United States or certain countries.” Compliance with the STANDARD simply means that “end products” that you sell through your GSA Schedule as a GSA product manufacturer or reseller cannot be manufactured in certain countries, including but not limited to: GSA Schedule Agreements are subject to the Trade Agreements Act (TAA), which means that all products listed in the GSA Annex Agreement must be manufactured or “substantially converted” in the United States or a “designated country” of the TAA. The specified countries consist of: Your email address will not be published. Mandatory fields are marked * Schedule GSA contracts are also subject to the Trade Agreements Act, so if you want to sell or sell goods to the government, you need to make sure your products comply with the TAA. These requirements make perfect sense. What could be more false than federal purchases from companies that do not work for the benefit of their own country. Let`s say you have an assembly plant in the United States that makes a product that consists of three parts. Part A represents 25% of the cost and comes from Canada, Part B represents 40% of the cost and is imported from Taiwan, Part C represents 15% of the cost and comes from China, and labour represents 20% of the manufacturing costs. Since only 15% of the cost comes from a non-TAA compliant country (China), the product is essentially converted in the United States and some countries so that it is TAA compliant. We know that GSA contractors must comply with many rules and regulations throughout the term of their contract.
For further questions, advice and guidance on TAA compliance and non-compliance, please contact Winvale for professional services to accelerate your regulatory opportunities. Now you know what the TAA (Trade Agreement Act) is and why it`s important to be TAA compliant. As a professional, you may want to focus solely on your business without having to delve deeper into TAA-related issues. In this case, hiring a professional sourcing consulting firm can be very helpful in passing TAA certification and keeping your inventory TAA compliant for every GSA calendar contract you have. The TAA may restrict the procurement of goods and services for federal contracts if the program management office decides to verify compliance with TAA regulations. In many ways, the TAA replaces the Buy American Act because the TAA allows the president to waive the Buy American Act under certain conditions. Subpart 25.4 of the Federal Procurement Regulations (FAR) provides guidance on compliance with the TAA.  In general, a product complies with the TAA standard if it is manufactured in the United States or a designated country.
The following list was taken from the Federal Procurement Regulation (FAR) and was last updated in November 2016 with the addition of Moldova and Ukraine and is current from June 2020. To access this FAR clause directly, please click here: Federal Acquisition Regulation (FAR) 52.225-5, Trade Agreements. If a product comes from a specific country, it is considered “TAA compliant”. Which in turn means that you can legally sell this product under your GSA Schedule Agreement. It is your responsibility to monitor and ensure that all products you include in your GSA agreement are from the United States…