On January 25, 2021, US President Joe Biden signed an Executive Order, “Ensuring the Future Is Made in All of America by All of America’s Workers,” that implements the “Buy American” campaign to tighten existing “Made in America Laws” by setting clear directives with a centralized coordinated effort.
“Made in America Laws” Overview
Key directives from the Executive Order that every government contractor should be aware of include the following:
- Creation of a Made in America Office within the White House Office of Management and Budget (OMB) helmed by a Made in America Director to oversee the implementation of “Made in America Laws,” which include all statutes, regulations, rules and Executive Orders relating to federal financial assistance or awards or federal procurement, including those that refer to “Buy America” or “Buy American,” that require or provide a preference for goods, products or materials produced in the United States.
- Increased scrutiny and centralized review of the Made in America waiver process by requiring an agency to provide the Made in America Director with a description and detailed justification of its proposed waiver. The Made in America Director, within 45 days of the date of appointment, will publish a list of the required information agencies must include when submitting a proposed waiver. Additionally, the granting agency must assess whether a significant portion of the cost advantage of a foreign-sourced product is the result of the use of dumped steel, iron or manufactured goods or the use of injuriously subsidized steel, iron or manufactured goods before granting a waiver in the public interest. The General Services Administration will publicly post waivers and associated information on a website.
- Promoting enforcement of the Buy American Act (BAA) of 1933 by directing the Federal Acquisition Regulatory Council (FAR Council) to consider amendments to applicable provisions in Federal Acquisition Regulation (FAR), title 48, Code of Federal Regulations, within 180 days of this Order (e., before of by July 25, 2021), including:
- Replacing the “component test” in Part 25 of the FAR with a test under which domestic content is measured by the value added to the product through US-based production or US job-supporting economic activity
- Increase the numerical threshold for domestic content requirements for end products and construction materials
- Increase the price preferences for domestic end products and domestic construction material
- Review and development of recommendations by the FAR Council for lifting existing constraints on the extension of the Made in America Laws to information technology to promote the policies under this Order.
- Reporting requirements by the head of each agency within 180 days of this Order (and biannually thereafter) describing implementation and compliance with Made in America Laws and recommendations on how to further effectuate the policies under this Order. The biannual reports also require reporting concerning the agency’s analysis of goods, products, materials and services that are exempt or waived from Made in America Laws and the agency’s analysis of spending as a result of waivers issued pursuant to the Trade Agreements Act of 1979, as amended, 19 USC 2511.
- Updates to the list of nonavailable articles by directing the Director of the OMB, through the Administrator of the Office of Federal Procurement Policy (OFPP) with the Secretary of Commerce and Made in America Director to review any proposed amendments by the FAR Council to determine whether there is a reasonable basis to conclude that the article is not reasonably available.
- Supplier scouting to identify American companies that are able to produce goods, products and materials in the United States that meet federal procurement needs by requiring agencies to partner with the Hollings Manufacturing Extension Partnership (MEP), discussed in the Manufacturing Extension Partnership Improvement Act.
- Administrator of General Services must submit to Made in America Director recommendations for ensuring implementation of administration policy on federal government property within 180 days of this Order.
- Revocation of certain prior Executive Orders, including:
- Executive Order 13788 of April 18, 2017 (Buy American and Hire American)
- Executive Order 13858 of January 31, 2019, section 5 (Strengthening Buy-American Preferences for Infrastructure Projects)
- Executive Order 13975 of January 14, 2021 (Encouraging Buy American Policies for the United States Postal Service)
- Executive Order 10582 of December 17, 1954 (Prescribing Uniform Procedures for Certain Determinations Under the Buy-America Act) and Executive Order 13881 of July 15, 2019 (Maximizing Use of American-Made Goods, Products, and Materials) are superseded to the extent they are inconsistent with this Order.
The Made in America Executive Order will have significant impacts to the vast majority of companies that contract with or supply or sell to the US government. As such, federal contractors and subcontractors should continue to closely monitor the implementation of the regulations under this Order.