E.O. 14005: Bolstering Federal Government Purchase of American Products and Services

E.O. 14005: Bolstering Federal Government Purchase of American Products and Services

INSIGHTi
E.O. 14005: Bolstering Federal Government
Purchase of American Products and Services
February 2, 2021
On January 25, 2021, President Joe Biden issued Executive Order (E.O.) 14005 to advance the policy that
the U.S. government should “use terms and conditions of Federal financial assistance awards and Federal
procurements to maximize the use of goods, products, and materials produced, and services offered in, the
United States.” Although the E.O. has broad applicability, this Insight focuses exclusively on the Buy
American Act (BAA) as applied to federal procurement and discusses selected provisions of the E.O.
As may occur during a presidential transition, E.O. 14005 revoked two executive orders and superseded a
third that also promoted Buy American policies and were issued by President Biden’s immediate
predecessor.
Implementing a Waiver Review Process
Under the E.O., a newly formed Made in America Office, located in the Office of Management and
Budget (OMB) and led by the Made in America director (appointed by the OMB director), wil be
responsible for reviewing agencies’ proposed waivers to the BAA and detailed justifications for
procurement of products or materials not mined, produced, or manufactured in the United States.
Presently, there is no centralized process or office for reviewing agencies’ waivers to the BAA.
General y, the review process as described in Section 4 of E.O. 14005 is to include the following steps:
 The granting agency submits a proposed waiver and written justification for use of goods,
products, or materials that have not been mined, produced, or manufactured in the United
States to the Made in America Office.
 The Made in America Office reviews the proposed waiver and determines whether
issuing it “would be consistent with applicable law and the policy set forth in section 1”
of E.O. 14005. The Made in America director notifies the granting agency of his or her
decision in writing.
 If the Made in American director determines that issuing the proposed waiver would
not be consistent with applicable law and policy, the director is to return the proposed
waiver for “further consideration.”
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 If the granting agency head disagrees with the determination, the agency is to notify
the Made in America director in writing. Disagreements or conflicts between the
director and agency head are to be resolved using procedures that “paral el” those
found in Section 7 of E.O. 12866.
If a granting agency is “obligated by law to act more quickly than the review procedures” in E.O. 14005
al ow, the agency head shal notify the Made in America Office and, “to the extent practicable, comply
with the requirements” set forth in Section 4.
Identifying Cost Advantages of Certain Foreign Products
Section 5 establishes a new requirement: Prior to “granting a waiver in the public interest, the relevant
granting agency shal assess whether a significant portion of the cost advantage of a foreign-sourced
product” resulted from the use of dumped or “injuriously subsidized” steel, iron, or manufactured goods.
The agency may consult with the International Trade Administration and include its assessment in the
agency’s waiver proposal.
Creating a Repository of Agencies’ Proposed Waivers
Neither the BAA nor the Federal Acquisition Regulation (FAR) requires agencies to draft written waivers
or maintain them in a central location for public access. Under Section 6, the Made in America director is
to provide information regarding agencies’ proposed waivers and the accompanying justifications to the
General Services Administration, which wil post the information on a website it creates and maintains.
Amending Buy American Act Regulations
Section 8 directs the Federal Acquisition Regulatory Council (FAR Council) to consider amending the
FAR to effect the following changes:
 To be considered a domestic end product for the purposes of the BAA, the article must be
manufactured in the United States, and the cost of domestic components must be greater
than 55% of the cost of al components. For items wholly or predominantly made of iron
or steel, the cost of foreign components must be less than 5% of the cost of al
components. Section 8(a)(i) suggests 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 activity.”
 Section (8)(a)(i ) suggests increasing the thresholds discussed in the previous bullet
statement.
 If a domestic offer is not the low offer, then the contracting officer is to increase the low
offer by 20% (if a large business submitted the low offer) or 30% (if a smal business
submitted the low offer). Section 8(a)(i i) suggests increasing the percentages.
Review of List of Nonavailable Items
The BAA does not apply to articles, materials, or supplies that are nonavailable, meaning they “are not
mined, produced, or manufactured in the United States in sufficient and reasonably available commercial
quantities and of a satisfactory quality.” FAR 25.104 contains a list of nonavailable articles, which is to be
published in the Federal Register for comment at least once every five years.
Section 9 requires the administrator of the Office of Federal Procurement Policy, in consultation with the
Secretary of Commerce and the Made in America director, to review any proposed amendment to the

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FAR to update this list. The review, including market research and economic analyses of relevant markets,
is to determine whether each article on the list meets the nonavailability criteria and shal be shared with
the FAR Council.
Reporting on Information Technology Commercial Items
Information technology that is a commercial item is not subject to the restrictions on purchasing foreign
end products. Section 10 requires the FAR Council to review “existing constraints on the extension of the
requirements in Made in America Laws to information technology that is a commercial item” and develop
recommendations for removing these constraints.
Additional Provisions in E.O. 14005
Other sections cover policy, definitions, agency reviews, supplier scouting, reporting requirements, and
products offered to the general public on federal property, and severability. The order also contains
general provisions that are usual y included in executive orders.

Author Information

L. Elaine Halchin

Specialist in American National Government

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