American Goods Defined

30+ Years of Manufacturing Quality Products in the USA

Many procurements are subsidized with state and federal funds that come with requirements on things like ownership of the end-product, product origin, special characteristics, and other elements. Buying American products or products made in the USA ties to many state and federal laws that date back nearly 100 years. Here we have compiled a list of those most common and simple explanations behind their origin and meaning.

Buy American Act

The Buy American Act of 1933 (BAA), codified in Title 41 United States Code (U.S.C.) Chapter 83 and Federal Acquisition Regulation (FAR) Part 25, generally requires contractors to certify to the contracting agency that they are offering "domestic end products" and use "domestic construction materials" in connection with a particular solicitation. The BAA serves to establish a price preference for domestic end products rather than to prohibit the acquisition of foreign goods.

In January of 2021, the FAR issued significant changes to domestic content restrictions in the BAA through a Final Rule. Soon after the publication, President Biden issued an Executive Order further tightening the BAA regulations and issued an enforcement titled "Ensuring the Future Is Made in All of America by All of America's Workers". The Order directs the FAR Council to consider replacing the component test with "a test under which domestic content is measured by the value that is added to the product through U.S.-based production or U.S. job-supporting economic activity." The order also proposes to increase transparency in the BAA exemption and waiver processes. This article further details the changes in the updated FAR Final Rule.

Buy America

Often confused with the Buy American Act, Buy America is a provision established in Section 165 of the Surface Transportation Assistance Act of 1982, which was a transportation funding and policy act created under the Reagan administration. This provision was created to address concerns over the surface transportation of highways and bridges. The Buy America provision was intended to give preference for the use of domestically produced materials on any procurements funded at least in part by the federal government. The Buy America provision requires that "all iron, steel, and manufactured products used in the project are produced in the United States" for projects funded by the DOT. In order for a product to be considered produced in the United States, "all of the manufacturing processes for the product must take place in the United States; and all of the components of the product must be of U.S. origin. A component is considered of U.S. origin if it is manufactured in the United States, regardless of the origin of its subcomponents."

The American Recovery and Reinvestment Act (ARRA)

Also often referred to as "The Recovery Act" or "The Stimulus". Enacted in 2009, the Act was passed by U.S. Congress as a fiscal stimulus in response to the Great Recession of 2008. The package included a series of federal expenditures aimed at creating new jobs and recovering lost ones, and also earmarked spending for infrastructure, education, healthcare, and renewable energy.

There is a Buy American provision (Section 1605) which pertains to projects funded by the ARRA. This section specifies that funds made available by this Act used for infrastructure projects involving "repair of public buildings or public works must be accomplished using iron, steel and manufactured goods produced in the United States."

"Made in USA"

Many companies use the phrase "Made in USA" as a dedication to producing goods in the U.S. These claims are regulated by the Federal Trade Commission (FTC) under the authority of Section 5 of the Federal Trade Commission Act. This is to ensure transparency and prohibit "unfair or deceptive acts or practices."

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