On Deceember 30, 2021, the U.S. Department of Defense published in the Federal Register (86 FR 74375) Defense Federal Acquisition Regulation Supplement: Trade Agreements Thresholds (DFARS Case 2022-D003)
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SUMMARY: DoD is issuing a final rule amending the Defense Federal
Acquisition Regulation Supplement (DFARS) to incorporate revised
thresholds for application of the World Trade Organization Government
Procurement Agreement and the Free Trade Agreements, as determined by
the United States Trade Representative.
DATES: Effective January 1, 2022.
FOR FURTHER INFORMATION CONTACT: Ms. Kimberly Bass, 571-372-6174.
SUPPLEMENTARY INFORMATION:
I. Background
This rule adjusts thresholds for application of the World Trade
Organization (WTO) Government Procurement Agreement (GPA) and Free
Trade Agreements (FTA) as determined by the United States Trade
Representative (USTR). The trade agreements thresholds are adjusted
every two years according to predetermined formulae set forth in the
agreements. The USTR has specified the following new thresholds in the
Federal Register (86 FR 67579, November 26, 2021), which are being
implemented in this rule:
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Supply Construction
contract contract
Trade agreement (equal to or (equal to or
exceeding) exceeding)
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WTO GPA................................. $183,000 $7,032,000
FTA:
Australia........................... 92,319 7,032,000
Bahrain............................. 183,000 12,001,460
CAFTA-DR (Costa Rica, Dominican 92,319 7,032,000
Republic, El Salvador, Guatemala,
Honduras, and Nicaragua)...........
Chile............................... 92,319 7,032,000
Colombia............................ 92,319 7,032,000
Korea............................... 100,000 7,032,000
Morocco............................. 183,000 7,032,000
Panama.............................. 183,000 7,032,000
Peru................................ 183,000 7,032,000
Singapore........................... 92,319 7,032,000
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Updates for the United States-Mexico-Canada Agreement (USMCA),
which superseded the North American Free Trade Agreement (NAFTA), are
not included in this revision to the trade agreements thresholds in the
DFARS. On January 29, 2020, the President signed into law the United
States-Mexico-Canada Agreement Implementation Act, through which
Congress approved the USMCA. On July 1, 2020, the USMCA entered into
effect. Although Canada is still a designated country under the WTO
GPA, Canada is no longer a Free Trade Agreement country, because
chapter 13 of the USMCA (Government procurement) applies only to the
United States and Mexico. While updates to the DFARS to implement the
revisions resulting from the USMCA are not implemented in this final
rule, implementation is being accomplished via separate rulemaking
under DFARS Case 2020-D032. Changes to the Federal Acquisition
Regulation (FAR) to implement the USMCA are being accomplished under
FAR Case 2020-014.
II. Publication of This Final Rule for Public Comment is not Required
by Statute
The statute that applies to the publication of the FAR is 41 U.S.C.
1707. Subsection (a)(1) of the statute requires that a procurement
policy, regulation, procedure, or form (including an amendment or
modification thereof) must be published for public comment if it
relates to the expenditure of appropriated funds and has either a
significant effect beyond the internal operating procedures of the
agency issuing the policy, regulation, procedure, or form, or has a
significant cost or administrative impact on contractors or offerors.
This final rule is not required to be published for public comment,
because it only adjusts the thresholds according to predetermined
formulae to account for changes in economic conditions, thus
maintaining the status quo, without significant effect beyond the
internal operating procedures of the Government.
III. Applicability to Contracts at or Below the Simplified Acquisition
Threshold and for Commercial Items, Including Commercially Available
Off-the-Shelf Items
This rule amends the DFARS to revise thresholds for application of
the WTO GPA and the FTA. The revisions do not add any new burdens or
impact applicability of clauses and provisions at or below the
simplified acquisition threshold or to commercial items.
IV. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). E.O.
13563 emphasizes the importance of quantifying both costs and benefits,
of reducing costs, of harmonizing rules, and of promoting flexibility.
This is not a significant regulatory action and, therefore, was not
subject to review under section 6(b) of E.O. 12866, Regulatory Planning
and Review, dated September 30, 1993.
V. Congressional Review Act
As required by the Congressional Review Act (5 U.S.C. 801-808)
before an interim or final rule takes effect, DoD will submit a copy of
the final rule with the form, Submission of Federal Rules under the
Congressional Review Act, to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States. A
major rule under the Congressional Review Act cannot take effect until
60 days after it is published in the Federal Register. The Office of
Information and Regulatory Affairs has determined that this rule is not
a major rule as defined by 5 U.S.C. 804.
VI. Regulatory Flexibility Act
The Regulatory Flexibility Act does not apply to this rule, because
this final rule does not constitute a significant DFARS revision within
the meaning of FAR 1.501-1, and 41 U.S.C. 1707 does not require
publication for public comment.
VII. Paperwork Reduction Act
The Paperwork Reduction Act (44 U.S.C chapter 35) does apply,
because the final rule affects the prescriptions for use of the
certification and information collection requirements in the provision
at DFARS 252.225-7035, Buy American-Free Trade Agreements--Balance of
Payments Program Certificate, and the certification and information
collection requirements in the provision at DFARS 252.225-7018,
Photovoltaic Devices--Certificate. The changes to these DFARS
provisions do not impose additional information collection requirements
to the paperwork burden previously approved under OMB Control Number
0704-0229, entitled ``DFARS Part 225, Foreign Acquisition and related
clauses,'' because the threshold changes are in line with inflation and
maintain the status quo.
List of Subjects in 48 CFR Parts 225 and 252
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.
Therefore, 48 CFR parts 225 and 252 are amended as follows:
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1. The authority citation for 48 CFR parts 225 and 252 continues to
read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
PART 225--FOREIGN ACQUISITION
225.1101 [Amended]
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2. Amend section 225.1101 by--
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a. In paragraph (6) introductory text, removing ``$182,000'' and adding
``$183,000'' in its place;
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b. In paragraph (10)(i) introductory text, removing ``$182,000'' and
adding ``$183,000'' in its place;
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c. In paragraph (10)(i)(A), removing ``$182,000'' and adding
``$183,000'' in its place;
0
d. In paragraph (10)(i)(B), removing ``$83,099'' and adding ``92,319''
in its place;
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e. In paragraph (10)(i)(C), removing ``$182,000'' and adding
``$183,000'' in its place; and
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f. In paragraphs (10)(i)(D) through (F), removing ``$83,099'' and
adding ``92,319'' in its place.
225.7017-3 [Amended]
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3. Amend section 225.7017-3 by--
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a. In paragraph (b), removing ``$182,000'' and adding ``$183,000'' in
its place; and
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b. In paragraph (c)(2), by removing ``$180,000'' and adding
``$183,000'' in its place.
225.7503 [Amended]
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4. Amend section 225.7503 by--
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a. In paragraphs (a) introductory text and (b) introductory text,
removing ``$7,008,000'' and adding ``$7,032,000'' in its place;
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b. In paragraph (b)(1), removing ``$10,802,884'' and adding
``$12,001,460'' in its place;
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c. In paragraph (b)(2), removing ``$7,008,000'' and adding
``$7,032,000'' in its place, and removing ``$10,802,884'' and adding
``$12,001,460'' in its place;
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d. In paragraph (b)(3), removing ``$10,802,884'' and adding
``$12,001,460'' in its place; and
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e. In paragraph (b)(4), removing ``$7,008,000'' and adding
``$7,032,000'' in its place, and removing ``$10,802,884'' and adding
``$12,001,460'' in its place.
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
252.225-7017 [Amended]
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5. Amend section 252.225-7017 by--
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a. Removing clause date ``(JAN 2020)'' and adding ``(JAN 2022)'' in its
place;
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b. In paragraphs (c)(2) and (3), removing ``$83,099'' and adding
``92,319'' in its p lace; and
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c. In paragraphs (c)(4) and (5), removing ``$182,000'' and adding
``$183,000'' in its place.
252.225-7018 [Amended]
0
6. Amend section 252.225-7018 by--
0
a. Removing clause date ``(JAN 2020)'' and adding ``(JAN 2022)'' in its
place;
0
b. In paragraphs (b)(1) and (2), removing ``$182,000'' and adding
``$183,000'' in its place;
0
c. In paragraphs (d)(3) introductory text and (d)(4) introductory text,
removing ``$83,099'' and adding ``92,319'' in its place; and
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d. In paragraphs (d)(5) introductory text and (d)(6) introductory text,
removing ``$182,000'' and adding ``$183,000'' in each place.
