252.225-7045 DEFENSE FEDERAL ACQUISITION REGULATION
or components of those systems are delivered to the construction site. Materials purchased directly by the Government are
supplies, not construction material.
“Cost of components” means—
(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of
incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether
or not a duty-free entry certificate is issued); or
(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component,
including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding
profit. Cost of components does not include any costs associated with the manufacture of the construction material.
“Critical component” means a component that is mined, produced, or manufactured in the United States and deemed
critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
“Critical item” means domestic construction material or a domestic end product that is deemed critical to the U.S. supply
chain. The list of critical items is at FAR 25.105.
“Designated country” means—
(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba,
Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France,
Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein,
Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland,
Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade
Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the
United Kingdom);
(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El
Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);
(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia,
Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea,
Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania,
Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia,
South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or
(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin
Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent
and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).
“Designated country construction material” means a construction material that is a WTO GPA country construction
material, a Free Trade Agreement country construction material, a least developed country construction material, or a
Caribbean Basin country construction material.
“Domestic construction material” means—
(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—
(i) An unmanufactured construction material mined or produced in the United States; or
(ii) A construction material manufactured in the United States, if—
(A) The cost of its components mined, produced, or manufactured in the United States exceeds, for the entire
period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar
years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost
of all its components. Components of foreign origin of the same class or kind for which nonavailability determinations have
been made are treated as domestic. Components of unknown origin are treated as foreign; or
(B) The construction material is a COTS item; or
(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a
construction material manufactured in the United States if the cost of iron and steel not produced in the United States
(excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the
components used in such construction material (produced in the United States means that all manufacturing processes of the
iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives).
The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill
products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized
in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not
produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign.
252.2-202