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Let's Talk About TAA

Intended to foster fair and open international trade, what impact does TAA compliance have on you and your government projects?


Intended to foster fair and open international trade, what impact does TAA compliance have on you and your government projects?

Products made in the United States or a designated country (marked here in red) meet the requirements for TAA compliance. Products originating from non-compliant countries—including China—must be “substantially transformed” in a designated country before they can be certified as TAA compliant.
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We now live in a global economy, one where products can be made and shipped around the world with the click of a button. For many commercial designers, this has been an unqualified boon, allowing them to source the perfect product for a project, regardless of geography. For designers working in the government and institutional fields, it has been more of a mixed blessing. Global commerce has expedited the specification process, to be sure, but Trade Agreement Act (TAA) compliance requirements from the federal government have also increased the stipulations attached to the products and services used on big-ticket projects.

“This agreement requires all U.S. government agencies to purchase only goods that are U.S. made or manufactured in a country that is part of the agreement,” says Kenneth Ng, president of Koncept Technologies Inc. “Member countries are part of the global community that believes in transparency and free trade in government procurement. Purchasing products from these designated countries means the government agency has complied with required TAA regulations.”

GSA schedules or contracts are already vetted through the compliance process, so you can make some assumptions that what’s on the contract is on the list, and that you shouldn’t have any issues. However, it’s in your best interest not to depend solely on the GSA schedule, and to have a working knowledge of the list and the laws around it.

For instance, it is possible to stay within compliance while using components from non-compliant countries, although it can be very difficult.

“To use a Chinese component within a product, it would have to be ‘substantially transformed’ in a compliant country to meet the requirement,” explains Kristen Dixon, vice president of business development for MooreCo.

Perhaps it’s easier to make sure that all products and their components originate from a compliant country—which is sometimes easier said than done.

sidestep multi-national missteps
In addition to ensuring the company’s country of origin is on the approved list, you should also confirm that the actual product itself originates from an approved country.

“We have to be careful in these days of multi-national companies,” says Rob McAtee, director of the mechanical engineering department and a vice president of H&A Architects and Engineers. “A relatively recent case that happened with us was that there were some mechanical items coming from a major Japanese manufacturer—Japan is a designated country, but the company has different production locations. Somewhere along the line it got overlooked that the TAA applied, so even though the manufacturer itself was headquartered in a designated country, the end units that showed up on the jobsite were manufactured in a country not on the designated list. It would have been easy to avoid had it been flagged and made clear earlier in the process.”

sanctioned swaps
Just because all of the materials and products on your original list are TAA compliant doesn’t mean you’re in the clear, as substitutions can be made. Savvy specifiers have learned to sweat the details.

Advice for (TAA) Agreement

"In terms of the designer’s responsibility, it’s really first and foremost to make sure that everybody knows that the documents are clear that the TAA applies. Don’t hesitate to bring that up in early involvement with vendors and suppliers,” says McAtee. “As long as it’s on everyone’s radar, it’s fairly easy to comply with. As long as everybody knows it’s going to be in effect and knows that they’re going to be required to certify the country of origin, I don’t see it as terribly burdensome.”

“It benefits both the designer and their government clients to do a little homework when they begin a project,” Kenneth Ng explains. “Know what products are required and what has been specified, and then begin the search for products. Most manufactures who have TAA-compliant products also register these products with the GSA.”

“Understand your cost objectives and learn the term ‘substantial transformation’ and the nuances of the laws surrounding it,” Dixon recommends. “Effectively source your components based on the compliance ideals. There are also preferences for environmentally friendly products that can work to a product’s benefit that should be taken into consideration in the design phase.”

“We see the big issue when we get substitutions in and we have to vet them through that process to make sure that something isn’t from a country that’s on the non-designated list,” explains Susan Pniewski, director of interior design for H&A Architects and Engineers. “Honestly, right now, with things being so cheap in China, that’s the biggest one we have to keep any eye out for, but there are a couple of other countries as well. The contracts are competed on a price basis most of the time, so the contractor has got to get in there and figure out a way to be the most cost-effective option and sometimes the countries not on the list are the most cost-effective ways to get things done. You have to be really careful and keep an eye out for it.”

alternatives from abroad
When working overseas, you may actually look for alternatives so that you don’t have to pay to ship the originally specified products halfway across the world. When doing this, keep in mind that the alternative products not only have to meet TAA compliance, but also any required codes.

“I’m working on a job right now in Indonesia, and that’s not one of the countries on the list,” says Pniewski. “We design basically around mostly American-made product, so what we’re doing now is trying to find closer substitutions so that they don’t have to buy everything from the States and ship it over. Some of the things are easy to substitute and they’re able to find good solutions, but with a lot of the products it turns to a quality issue as well, where they can’t provide the same quality of material that we had specified. So what they’re finding is that with a lot of the interior materials, they’re having to provide what’s originally specified and having to ship it over there in order to get the quality we need, so it meets the codes we need.”
Searching for alternatives in a TAA-compliant country allows you to take advantage of locally-sourced materials, and can also contribute to LEED points.

“From our perspective, even if we’re working overseas, the list is very extensive; it allows us to specify a pretty wide variety of products,” Pniewski says. “One of the points we’ll often go after is locally procured items—everything has to be done within a 500 mile radius. When you’re working overseas for the federal government, which is a lot of what we do, there are a lot of opportunities there.”

“One of the most recent examples is when I was working on a project in Armenia, we procured local stone from there, because who wants to spend the money to ship it? It’s not very cost effective, and from a LEED perspective it’s not very energy friendly to get stone from the States, Canada or even Italy when you’re in Armenia,” she continues. “We did research, found the local quarry and specified stone that was local. From a LEED perspective that’s a great thing. There are so many opportunities and there are so many countries that even if the country you’re working in isn’t on the list, there’s probably somebody nearby that is.”

And even though the most recent TAA compliance expansion includes state, local, tribal and educational institutions, don’t expect this requirement to spread to other industry clients any time soon.

“The TAA was originally set up to promote global trade opportunities between TAA member countries,” says Edmund Ng. “For broader

consumer goods, country of origin is very unlikely to become the key factor in purchasing decisions because cost will always come first. For the mainstream market, products are likely to continue to come from wherever it is most economical to manufacture.”


Kylie Wroblaski is a former editor for BUILDINGS magazine, and has written previously about architecture and facilities management.