The US is generally pretty keen on international free trade agreements. And why shouldn’t it be? After all, free trade agreements have the ability to open up foreign markets to US goods and services, allowing new and expanding opportunities for US companies. But “free trade” does not always mean “free trade” – it usually means “free-er trade, subject to numerous exceptions,” with the exceptions proving a constant irritant to our free trade partners. Case in point: two recent events – one in the European Union and one in Canada – demonstrate that “free trade” (subject to numerous caveats) is still a bone of contention, even among long-established trading partners. While “free-est trade” may be too much to ask for, maybe “free-er trade” with fewer strings attached would at least be a step in the right direction.
Continue Reading Free(er?) Trade – US, EU and Canada Quibble Over Market Access and Domestic Preferences

By David Gallacher 

Earlier this month, we wrote about a new proposed rule from the Department of Energy imposing new and onerous requirements relating to compliance with the U.S. export control laws. DOE claimed that this proposed rule was modeled on a prior rule included in the Department of Defense Federal Acquisition Regulation Supplement (DFARS) at DFARS Subpart 204.73 and DFARS 252.204-7008, promulgated originally in 2008 (and discussed here). But be aware that those DFARS rules were recently removed. Kind of. In case you were not paying attention, the DFARS export restrictions were recently moved to DFARS Subpart 225.79 and DFARS 252.225-7048. See 78 Fed. Reg. 36108. So, even though the citations may have changed, the song remains the same.Continue Reading “The Song Remains the Same” – DFARS Removes and Replaces Restrictions on Export Controls

By David Gallacher

Two months ago, we published a brief list of compliance tips to keep in mind when dealing with Buy American requirements. We got an awful lot of

Continue Reading Buy American Redux – 15 Tips for Navigating the Buy American Maze

By David Gallacher

1. There is no single “Buy American” requirement – there are numerous statutes with differing requirements. Make sure you know which one applies.

2. Whether you are a prime or a subcontractor, certify only to the specific “Buy American” requirements in the RFP; do not make a broader certification than is required.Continue Reading “Buy American” Compliance Tips

By David Gallacher

2012 saw several updates with regard to free trade agreements (“FTAs”) between the U.S. and its international trading allies. The most notable of these was the U.S.-Korea FTA (“KORUS”), but several other changes were made to the U.S. procurement regulations implementing other free trade agreements. Regrettably, negotiations with China remain stalled with no firm promises on the horizon. Following is a summary of some of the key changes over the last year.Continue Reading Free Trade Agreement Updates for 2012

By David Gallacher

In December 2011 the World Trade Organization reached an agreement in principle to implement “historic revisions” to the World Trade Organization Government Procurement Agreement (WTO GPA), a trade agreement covering the public procurement markets in more than 40 WTO member states (including the United States). On March 30, 2012, the WTO GPA formally adopted these revisions. While the updates have been formally agreed upon, it may take months until two-thirds of the signatory countries ratify the agreement and make the changes official. Nevertheless, the international community appears to be moving forward with plans to implement, pending ratification.Continue Reading Free Trade Agreement Updates – Changes to the WTO GPA and KORUS FTA

By David Gallacher and John Bonn

On January 2, 2011, the President signed the James Zadroga 9/11 Health and Compensation Act of 2010, Pub. L. No. 111-347, which set up a relief fund for victims, first responders, and construction workers who were injured in the September 11 terrorist attacks in New York City. To pay the estimated $4.3 billion price tag for the Act, Section 301 of the Act imposed on any foreign person a tax equal to 2% of federal procurement payment received by that foreign person. See 26 U.S.C. § 5000C. In addition, any person who makes or otherwise is a withholding agent with respect to such a payment is required to withhold the 2% tax from the federal procurement payment and remit the tax withheld to the Internal Revenue Service (“IRS”) under tax laws and regulations applicable to withholding of United States taxes from payments made to foreign persons. Although the tax has been in place for more than 14 months and the IRS has issued a revised Form 1042 with revised instructions to implement withholding and reporting obligations, the Government is only now turning to the details of how this tax will be accounted for in connection with the procurement process. And – as is often the case – there is quite a lot of devil in those details.Continue Reading Terrorism and Taxes – Proposed FAR Rule Imposes 2% Tax on Foreign Offers to Fund 9/11 Relief Fund

By Curtis M. Dombek

On February 25, 2011, the President issued an Executive Order blocking not only the assets of Muammar Qadhafi, Ayesha Qadhafi, Khamis Qadhafi, Mutassim Qadhafi, and Saif Al Islam Al Qadhafi, but also blocking all assets of the Government of Libya, as follows:
 

“All property and interests in property that are in the United States, that hereafter come within the United States, or that are or hereafter come within the possession or control of any United States person, including any overseas branch, of the Government of Libya, its agencies, instrumentalities, and controlled entities, and the Central Bank of Libya, are blocked and may not be transferred, paid, exported, withdrawn, or otherwise dealt in.”
 Continue Reading New Sanctions Block Continuing Performance Of Libyan Government Contracts In Addition To Targeting Col. Qadhafi’s Assets

The following is the first in a series of postings which will provide a brief look into UN procurement intended to help potential contractors assess the viability of doing business with the UN.

In an era of shrinking procurement budgets, federal contractors are increasingly seeking new opportunities abroad. But many companies understandably view navigation of the numerous rules, regulations and laws associated with international procurement as daunting at best and unfeasible at worst. Luckily, there exists a middle ground allowing companies the opportunity to expand globally without ever dialing a country code or resorting to Skype – the United Nations.Continue Reading A Brief Look At United Nations Procurement: Going International … Sort Of

By John S. Tobey

Government contractors are called-upon with increasing frequency to perform their contractual obligations abroad. Apart from the myriad of laws and regulations governing their performance on the international stage, government contractors also must be cognizant of the terms and conditions of any applicable Status of Forces Agreements. SOFAs, as they are commonly referred to, are voluntary multilateral or bilateral peacetime agreements that define the legal status of personnel and property (“covered individuals”) of one nation in the territory of another nation (“host nation”). Covered individuals will want to familiarize themselves with the pertinent SOFA because it is the agreement that sets forth the legal framework under which they operate in the host nation. The pertinent SOFA may cover a broad range of topics, ranging from civil and criminal jurisdiction to the wearing of uniforms by armed forces while away from military installations.
 Continue Reading Status Of Forces Agreements – A Primer