public procurement on non-discriminatory terms. At the same time, products from countries that have not concluded such trade agreements are excluded from government procurement. Countries that have concluded such agreements are designated as parties to the World Trade Organization (“WTO”) agreement. . The Trade Agreements Act (TAA) was created to promote fair international trade with certain designated countries. Companies that work with foreign-made products or services need to know which companies are limited to comply with the TAA and GSA. The U.S. government was required to procure only products and services manufactured in the United States or finished products from TAA-dependent countries. As a government department, this rule also applies to the GSA, which means that the GSA requires that products and services sold by contractors be manufactured in the United States or taa-compliant countries. The TAA`s country of origin test defines “a product from a country” as follows: Assuming you have an assembly facility in the United States that manufactures a product from three parts.
Part A accounts for 25% of costs and comes from Canada, Part B accounts for 40% of costs and is imported from Taiwan, Part C accounts for 15% of costs and comes from China, and labor accounts for 20% of production costs. Since only 15% of the costs come from a non-TAA compliant country (China), the product is thoroughly processed in the United States and the designated countries, so it is TAA compliant. The Trade Agreements Act 1979 (TAA), Pub.L. 96-39, 93 Stat. 144, enacted July 26, 1979, codified as 19 U.S.C c. 13 (19 U.S.C§ 2501-2581), is an act of Congress that governs trade agreements negotiated between the United States and other countries pursuant to the Trade Act of 1974. It provided modalities for the implementation of the Tokyo Round of the General Agreement on Tariffs and Trade. However, the TAA does not limit foreign trade outside the scope of federal procurement. This means that you cannot freely sell TAA-compliant products in the commercial market….