SSINA BUY AMERICAN

WHAT ARE BUY AMERICAN REQUIREMENTS?
The term “Buy America” refers to a number of statutory programs that require governmental contracting agencies to give a preference to American-made goods and materials when procuring them for public use or awarding contracts for the construction, alteration, or repair of public buildings and public works. The U.S. Congress and various states have enacted Buy American policies to ensure that taxpayer dollars will be used to create and preserve jobs domestically.

WHAT DOES THIS MEAN FOR SPECIALTY STEEL?
If the project you are supplying uses federal highway, transit, rail or other transportation program dollars, you are required to supply steel that is produced in the United States. Similarly, if the project is funded by the American Recovery and Reinvestment Act (ARRA) appropriations, Pub. L. 110-5 (2009), you are required to supply steel produced in the United States. That phrase, “production in the United States” means that all the manufacturing processes for the steel you
are supplying must have taken place in the United States, with the exception of metallurgical processes involving refinement of steel additives.

WHAT PROJECTS DOES BUY AMERICA APPLY TO?
There are a number of Buy American requirements relevant to doing business with either the federal government or with states or municipalities. These requirements apply to, among other things, most federal level procurements pursuant to the Buy American Act (BAA), 41 U.S.C. § 10a-10d, funds appropriated by the American Recovery and Reinvestment Act (ARRA), the Federal-Aid Highway Administration (FHWA), the Federal Transit Administration (FTA), the Federal Railroad Administration, the Federal Aviation Administration, and the Intercity Passenger Rail Service Corridor Grant Program. Although these various requirements bear some similarity to one another, as well as to the BAA, they are, nonetheless, distinct in their application and impose different requirements on public works contractors and their suppliers. The question of whether particular goods will satisfy the Buy American requirements that attach to a particular project merely requires identification of the project funding source as well as a review of the project’s contract clauses and materials specifications.

BUT AREN’T BUY AMERICAN REQUIRMENTS VOID BECAUSE OF INTERNATIONAL TRADE AGREEMENTS LIKE NAFTA?
No. In fact, many Buy American requirements are wholly unaffected by international agreement. For instance, the Buy American requirements of the FHWA and the FTA are completely unaffected by U.S. and state obligations under international agreement. Moreover, and contrary to popular belief, the NAFTA applies only to direct federal procurement and does not apply to state level procurements. That means neither the NAFTA nor the World Trade Agreement’s Government Procurement Agreement have any bearing on the Buy American
requirements of the FHWA and FTA. In the instances where a trade agreement could apply to other federal-aid funded procurements, certain factors must be present, including a high-dollar procurement-value threshold that must be met in order for the agreement to be applicable.

BUT WHAT ABOUT THE RECENT U.S & CANADA AGREEMENT?
While the new agreement entered into between the United States and Canada on February 16, 2010, affords Canadian manufacturers access to certain federal and sub-federal (state) government procurements, it has little impact on most Buy America requirements. Because the framework used to identify U.S. concession under the agreement is the same framework used by the U.S. to identify its international trade obligations under the GPA, the limitations it reserved under the GPA apply to the new agreement as well. So for instance, because the United States exempts from the GPA’s coverage procurements funded by “Federal funds for mass transit and highway projects,” that same reservation also applies to the new U.S. and Canada agreement. Thus, the Buy American requirements applicable to federally supported mass transit (FTA) and highway projects (FHWA) continue to apply without exception for Canadian goods irrespective of the new agreement.