[Federal Register Volume 62, Number 1 (Thursday, January 2, 1997)]
[Rules and Regulations]
[Pages 261-262]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-33210]


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DEPARTMENT OF DEFENSE
48 CFR Parts 5, 14, 15, 17, 25, 27, and 52

[FAC 90-45; FAR Case 93-310; Item VI]
RIN 9000-AF60


Federal Acquisition Regulation; Implementation of the North 
American Free Trade Agreement Implementation Act

AGENCIES: Department of Defense (DOD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Interim rule adopted as final with changes.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council have agreed on a final rule 
implementing the North American Free Trade Agreement (NAFTA) 
Implementation Act related to applications of the Buy American Act 
provisions to acquisition of certain Mexican and Canadian products. 
This regulatory action was not subject to Office of Management and 
Budget review under Executive Order 12866, dated September 30, 1993, 
and is not a major rule under 5 U.S.C. 804.

EFFECTIVE DATE: January 1, 1997.

FOR FURTHER INFORMATION CONTACT: Mr. Paul L. Linfield at (202) 501-1757 
in reference to this FAR case. For general information, contact the FAR 
Secretariat, Room 4037, GS Building, Washington, DC 20405, (202) 501-
4755. Please cite FAC 90-45, FAR case 93-310.

SUPPLEMENTARY INFORMATION:

A. Background

    An interim rule was published in the Federal Register on January 5, 
1994 (59 FR 544, FAC 90-19), FAR case 93-310, to implement NAFTA. Based 
on the analysis of public comments, a revised interim rule was 
published in the Federal Register on June 20, 1996 (61 FR 31646) (FAC 
90-39). One late public comment was received and considered, but was 
not incorporated in the final rule. This final rule does contain 
revisions resulting from public comments received on FAR Case 96-312 
published as Item II in this FAC. Upon consideration of those public 
comments, certifications eliminated under the interim rule published at 
61 FR 31646 are being retained. The Government believes if the 
certifications were eliminated, offerors would be required to submit 
more detailed information regarding the origins of offered products. 
Without this information, enforcing a national policy grounded in vital 
economic and security interests would be extremely difficult. To 
satisfy this national policy interest, the self-policing discipline of 
a certification was determined to be the less burdensome alternative.

B. Regulatory Flexibility Act

    This final rule is expected to have a significant economic impact 
on a substantial number of small entities within the meaning of the 
Regulatory Flexibility Act, 5 U.S.C. 601 et seq., because the rule 
waives the Buy American Act for certain Mexican and Canadian products. 
A Final Regulatory Flexibility Analysis (FRFA) has been prepared. A 
copy of the FRFA may be obtained from the FAR Secretariat. The FRFA is 
summarized as follows: This final rule generally applies to all 
businesses, large and small, that contract with Federal agencies other 
than the Department of Defense for supply contracts with an estimated 
value above $25,000. This final rule also applies to Federal 
construction contracts, including those awarded by the Department of 
Defense, with an acquisition value of $6,500,000 or more. Although U.S. 
businesses may face increased competition from Canadian or Mexican 
firms, they may also find an increased market for their materials in 
Canada and Mexico.

C. Paperwork Reduction Act

    The Paperwork Reduction Act applies because the provision at FAR 
52.225-20 requires offerors to list the line item number and the 
country of origin for any end product other than a domestic end 
product. Accordingly, a request for clearance of the information 
collection requirement was submitted to the Office of Management and 
Budget under 44 U.S.C. 3501, et seq. and has been approved under OMB 
Control Number 9000-0130.

List of Subjects in 48 CFR Parts 5, 14, 15, 17, 25, 27, and 52

    Government procurement.

    Dated: December 24, 1996.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.

Interim Rule Adopted as Final With Changes

    Accordingly, the interim rule amending 48 CFR Parts 5, 14, 15, 17, 
25, 27, and 52, which was published at 59 FR 544 on January 5, 1994, 
and amended by the interim rule published at 61 FR 31646 on June 20, 
1996, is adopted as final with changes as set forth below:
    1. The authority citation for 48 CFR Parts 5, 14, 15, 17, 25, 27, 
and 52 continues to read as follows:

    Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

PART 25--FOREIGN ACQUISITION


25.408  [Amended]

    2. Section 25.408 is amended in paragraph (a)(3) by removing the 
word ``Provision'' in the title of the provision and inserting 
``Certificate''.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    3. Section 52.212-3 is amended by revising the date of the 
provision and paragraphs (g)(1)(i), (g)(1)(iii), and (g)(2) to read as 
follows:


52.212-3  Offeror Representations and Certifications--Commercial Items.

* * * * *

OFFEROR REPRESENTATIONS AND CERTIFICATIONS--COMMERCIAL ITEMS (JAN 1997)

* * * * *
    (g)(1) * * *
    (i) The offeror certifies that each end product being offered, 
except those listed in paragraph (g)(1)(ii) of this provision, is a 
domestic end product (as defined in the clause entitled ``Buy 
American Act--North American Free Trade Agreement

[[Page 262]]

Implementation Act--Balance of Payments Program,'' and that 
components of unknown origin have been considered to have been 
mined, produced, or manufactured outside the United States.
* * * * *
    (iii) Offers will be evaluated by giving certain preferences to 
domestic end products or NAFTA country end products over other end 
products. In order to obtain these preferences in the evaluation of 
each excluded end product listed in paragraph (g)(1)(ii) of this 
provision, offerors must identify and certify below those excluded 
end products that are NAFTA country end products. Products that are 
not identified and certified below will not be deemed NAFTA country 
end products. The offeror certifies that the following supplies 
qualify as ``NAFTA country end products'' as that term is defined in 
the clause entitled ``Buy American Act--North American Free Trade 
Agreement Implementation Act--Balance of Payments Program'':

----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
(Insert line item numbers)
* * * * *
    (2) Alternate I. If Alternate I to the clause at 52.225-21 is 
included in this solicitation, substitute the following paragraph 
(g)(1)(iii) for paragraph (g)(1)(iii) of this provision:
    (g)(1)(iii) Offers will be evaluated by giving certain 
preferences to domestic end products or Canadian end products over 
other end products. In order to obtain these preferences in the 
evaluation of each excluded end product listed in paragraph (b) of 
this provision, offerors must identify and certify below those 
excluded end products that are Canadian end products. Products that 
are not identified and certified below will not be deemed Canadian 
end products.
    The offeror certifies that the following supplies qualify as 
``Canadian end products'' as that term is defined in the clause 
entitled ``Buy American Act--North American Free Trade Agreement 
Implementation Act--Balance of Payments Program'':

----------------------------------------------------------------------
(Insert line item numbers)
* * * * *
(End of provision)


    4. Section 52.225-20 is amended in the section heading and 
provision heading by removing the word ``Provision'' and inserting 
``Certificate''; revising the date of the provision and its Alternate I 
to read ``(JAN 1997)''; revising paragraph (a) of the provision; 
revising the first paragraph of paragraph (c) of the provision and of 
Alternate I; and by inserting the words ``offeror certifies that the'' 
after the first word ``The'' in the first sentence of the second 
paragraph of paragraph (c) of the provision and of Alternate I to read 
as follows:


52.225-20  Buy American Act--North American Free Trade Agreement 
Implementation Act--Balance of Payments Program Certificate.

* * * * *

BUY AMERICAN ACT--NORTH AMERICAN FREE TRADE AGREEMENT IMPLEMENTATION 
ACT--BALANCE OF PAYMENTS PROGRAM CERTIFICATE

(JAN 1997)

    (a) The offeror certifies that each end product being offered, 
except those listed in paragraph (b) of this provision, is a 
domestic end product (as defined in the clause entitled ``Buy 
American Act--North American Free Trade Agreement Implementation 
Act--Balance of Payments Program'') and that components of unknown 
origin have been considered to have been mined, produced, or 
manufactured outside the United States.
* * * * *
    (c) Offers will be evaluated by giving certain preferences to 
domestic end products or NAFTA country end products over other end 
products. In order to obtain these preferences in the evaluation of 
each excluded end product listed in paragraph (b) of this provision, 
offerors must identify and certify below those excluded end products 
that are NAFTA country end products. Products that are not 
identified and certified below will not be deemed NAFTA country end 
products.
* * * * *

Alternate I (JAN 1997). * * *

    (c) Offers will be evaluated by giving certain preferences to 
domestic end products or Canadian end products over other end 
products. In order to obtain these preferences in the evaluation of 
each excluded end product listed in paragraph (b) of this provision, 
offerors must identify and certify below those excluded end products 
that are Canadian end products. Products that are not identified 
below will not be deemed Canadian end products.
* * * * *


52.225-21  [Amended]

    5. Section 52.225-21 is amended by revising the date of the clause 
to read ``(JAN 1997)'' and by removing the word ``specifying'' in the 
fourth sentence of paragraph (c) of the clause and of Alternate I and 
inserting ``certifying''.

[FR Doc. 96-33210 Filed 12-31-96; 8:45 am]
BILLING CODE 6820-EP-P