DFARS Part 225 - Foreign Acquisition DFARS

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THE DFARS – PART 225

DFARS PART #: 225
DFARS PART: Foreign Acquisition
SPEAKER: Philip Lee
FIRM: McCarter & English
EMAIL: plee@mccarter.com
TODAYS SPEAKER + TOPIC

DFARS PART 225
Foreign Acquisition

Key Points of Buy American Act
• Written as a prohibition, but actually establishes preference for domestic end products
delivered to the Government in competitive procurements for prime contracts
• Except for COTS items – 2 Part Test: (1) Manufactured in the US; and (2) Cost of Domestic
Components Must Exceed 65% of Cost of All Components (as of January 1, 2024)
• Percentage will increase to 75% starting in CY 2029
• “Manufactured” is not defined
• Generally interpreted as the assembly necessary to form a completed end product
that meets the Government’s requirements
• Simple assembly may be enough, but packaging is generally not enough

Definitions (DFARS 225.003):
• Domestic End Product:
• (i) An unmanufactured end product mined or produced in the United States; or
• (ii) An end product manufactured in the United States if—
• The cost of its qualifying country components and its components that are
mined, produced, or manufactured in the United States exceeds 60
percent of the cost of all its components, except that the percentage will
be 65 percent for items delivered in calendar years 2024 through 2028 and
75 percent for items delivered starting in calendar year 2029, unless an
alternate percentage is established for a contract in accordance
with FAR 25.101(d);
• (continued on next)

• …or award is made before January 1, 2030, for a foreign end product that
exceeds 55 percent domestic content (see 225.103(b)(ii)). The cost of components
includes transportation costs to the place of incorporation into the end product
and U.S. duty (whether or not a duty-free entry certificate is issued). Components
of unknown origin are treated as foreign. Scrap generated, collected, and
prepared for processing in the United States is considered domestic
(continued on next)

A component is considered to have been mined, produced, or manufactured in the
United States (regardless of its source in fact) if the end product in which it is
incorporated is manufactured in the United States and the component is of a class
or kind for which the Government has determined that— (1) Sufficient and
reasonably available commercial quantities of a satisfactory quality are not mined,
produced, or manufactured in the United States; or (2) It is inconsistent with the
public interest to apply the restrictions of the Buy American statute.

DoD “Qualifying Countries”
• Unlike civilian agencies, DoD allows Qualifying Country components to count
toward domestic thresholds:
• “The cost of its qualifying country components and its components that are
mined, produced, or manufactured in the United States exceeds [the
applicable threshold]”

“Qualifying Country” and Construction Contracts
• "Qualifying country" means a country with a reciprocal defense procurement
memorandum of understanding or international agreement with the United
States in which both countries agree to remove barriers to purchases of supplies
produced in the other country or services performed by sources of the other
country, and the memorandum or agreement complies, where applicable, with
the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776)
and with 10 U.S.C. 2457
• Qualifying Country exception applies to end products, not materials supplied
under construction contracts

DoD Two-Part Test
• DFARS 225.101, General. For DoD, the following two-part test determines whether a
manufactured end product is a domestic end product:
• (i) The end product is manufactured in the United States; and
• (ii)(A) The cost of its U.S. and qualifying country components exceeds 60 percent of
the cost of all its components, except that the percentage will be 65 percent for
items delivered in calendar years 2024 through 2028 and 75 percent for items
delivered starting in calendar year 2029, but see paragraph (d) of this section. This
test is applied to end products only and not to individual components.

DoD Two-Part Test –Iron and Steel
• (i) The end product is manufactured in the United States; and
• (ii) (B) For an end product that consists wholly or predominantly of iron or steel or a combination of both, the
cost of iron and steel not produced in the United States or a qualifying country must constitute less than
5 percent of the cost of all the components used in the end product. The cost of iron and steel not
produced in the United States or a qualifying country 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
or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of
all iron or steel components not produced in the United States or a qualifying country, excluding commercially
available off-the-shelf (COTS) fasteners. The domestic content test of the Buy American statute has not been
waived for acquisitions of COTS items in this category, except for COTS fasteners.

DoD Fallback Threshold (DFARS 225.103(b)(ii))
• Fallback threshold allows for the use of the 55 percent domestic content
threshold until one year after the increase of the domestic content threshold to
75 percent.
• The fallback threshold removes the need for a “nonavailability determination”
until January 1, 2030 for foreign end products that exceed 55 percent domestic
content.
• Effect: When there are not domestic offers, foreign offers at the 55% threshold
will beat other foreign offers whose price will be weighted by the evaluation
factor.

DoD Exceptions
• Public interest exceptions for certain countries are in 225.872 (qualifying country sources)
• DFARS 225.872-1, General. As a result of MOUs and other international agreements, DoD has
determined it inconsistent with the public interest to apply restrictions of the BAA or Balance of
Payments Program to the acquisition of qualifying country end products from the following
countries:
• Australia, Belgium, Canada, Czech Republic, Denmark, Egypt, Estonia, Federal Republic of Germany,
Finland, France, Greece, Israel, Italy, Japan, Latvia, Lithuania, Luxembourg, Netherlands, Norway, Poland,
Portugal, Slovenia, Spain, Sweden, Switzerland, Turkey, United Kingdom of Great Britain and Northern
Ireland
• Individual acquisitions of qualifying country end products from Austria may be exempted as well
on a case-by-case basis

Additional DoD Public Interest Exceptions
• For procurements covered by the WTO GPA, USD AT&L has determined that it is
inconsistent with the public interest to apply the Buy American statute to end
products that are substantially transformed in the United States
• End products that are substantially transformed in the U.S. are eligible end products
under the Trade Agreements Act (TAA) and therefore, the BAA does not apply. DFARS
225.103(a)(i)(B)

Nonavailability Exception
• A determination that an article, material, or supply is not reasonably available is required
when domestic offers are insufficient to meet the requirement and award is to be made on
other than a qualifying country or eligible end product. DFARS 225.103(b)
• DOD Class Deviation – Requirements for Nonavailability Waiver Determinations Under the
Buy American Statute
• Effective Nov. 16, 2021, all proposed individual nonavailability waiver determinations must be
submitted to the Made in America Office
• Final decision to execute an individual nonavailability waiver determination will be approved in
accordance with DFARS 225.103(b)(ii)

Nonavailability – Construction Materials
• DFARS 225.202(a)(2): A nonavailability determination is not required for
construction materials listed in FAR 25.104(a). For other materials, a
nonavailability determination shall be approved at the levels specified in
225.103(b)(ii). Use the estimated value of the construction materials to determine
the approval level. A nonavailability determination is not required before January
1, 2030, if there is an offer for foreign construction material that exceeds 55
percent domestic content (also see FAR 25.204(b)(1)(ii) and (b)(2)(ii)).

DoD Specific Exceptions
• DoD Class Determinations. DoD has determined that the following articles are
not reasonably available from domestic sources, and a separate determination as
to whether the article is reasonably available is not required:
• Spare or replacement parts that must be acquired from the original foreign
manufacturer or supplier
• Foreign drugs acquired by the Defense Supply Center, Philadelphia, when the
Director, Pharmaceuticals Group, Directorate of Medical Materiel, determines
that only the requested foreign drug will fulfill the requirements
DFARS 225.103(b)(iii)

Unreasonable Cost for DoD Procurements
• Cost of a domestic end product is unreasonable if it is not the low evaluated offer
when evaluated under subpart 225.5
• DFARS 225.103(c)
• DoD uses an evaluation factor of 50%
• DFARS 225.105

DoD Balance of Payments Program – DFARS Subpart 225.75
• Acquire only domestic end products for use outside the U.S. and use only
domestic construction material for construction outside the U.S., unless an
exception applies (this list is not exhaustive):
• Estimated cost of acquisition is below SAT
• End product or construction material is listed in FAR 25.104
• End product or construction material is information technology that is a
commercial item
• Acquisition is covered by WTO GPA
• End product acquired for commissary resale
• CO determines that a requirement can best be filled by a foreign end product
or construction material

Trade Agreements Act – Key Points
• Allows agencies to acquire products and services from both the U.S. and other
designated countries
• Unlike BAA, which creates only a preference, the TAA prohibits supplying
products and services from countries not approved as TAA eligible
• Goods and Services
• Thresholds – vary by agreement
• Not all goods/services covered
• Look at agreement Annex for coverage

DoD Trade Agreements Act
• DoD limits the applicability of the TAA to certain products, which are specifically
identified in the regulations
• DFARS 225.401-70, End Products Subject to Trade Agreements.
Acquisitions of end products in the following product service groups (PSGs)
are covered by trade agreements if the value of the acquisition is at or above
the applicable trade agreement threshold and no exception applies. If an end
product is not in one of the listed groups, the trade agreements do not apply

Additional DoD TAA Exceptions
• DFARS 225.401, Exceptions.
• If a department or agency considers an individual acquisition of a product to
be indispensable for national security or national defense purposes and
appropriate for exclusion from the provisions of FAR 25.4, it may submit a
request to the Director of Defense Procurement and Acquisition Policy

Additional DoD TAA Exceptions
DFARS 225.403, World Trade Organization Government Procurement Agreement
and Free Trade Agreements.
For acquisitions of supplies covered by the World Trade Organization Government Procurement
Agreement, acquire only U.S.-made, qualifying country, or designated country end products
unless—
• offers of U.S.-made, qualifying country, or designated country end products from responsive,
responsible offerors are either not received or insufficient to fill the Government's requirements;
• A national interest waiver is granted on a case-by-case basis; or
• Acquisition is in support of operations in Afghanistan

Evaluation Procedures
• DFARS 225.502(b): Use the following procedures instead of the procedures in FAR
25.502(b) for acquisitions subject to the World Trade Organization Government
Procurement Agreement:
• (i) Consider only offers of U.S.-made, qualifying country, or designated country end products,
except as permitted by 225.403 or 225.7703–1
• (ii) If price is the determining factor, award on the low offer

Evaluation Procedures (cont’d)
• DFARS 225.502(c): (c) Use the following procedures instead of those in FAR 25.502(c) for
acquisitions subject to the Buy American statute or the Balance of Payments Program:
• (i)(A) If the acquisition is subject only to the Buy American statute or the Balance of Payments
Program, then only qualifying country end products are exempt from application of the Buy
American or Balance of Payments Program evaluation factor
• (B) If the acquisition is also subject to a Free Trade Agreement, then eligible products of the
applicable Free Trade Agreement country are also exempt from application of the Buy
American or Balance of Payments Program evaluation factor but see 225.106
• (ii) If price is the determining factor, use the following procedures:
• (A) If the low offer is a domestic offer, award on that offer
• (B) If there are no domestic offers, award on the low offer (see example in PGI 225.504(1))

• (C) If the low offer is a foreign offer that is exempt from application of the Buy American or
Balance of Payments Program evaluation factor, award on that offer. (If the low offer is a
qualifying country offer from a country listed at 225.872–1(b), execute a determination in
accordance with 225.872–4.)
• (D) If the low offer is a foreign offer that is not exempt from application of the Buy American
or Balance of Payments Program evaluation factor, and there is another foreign offer that is
exempt and is lower than the lowest domestic offer, award on the low foreign offer (see
example in PGI 225.504(2)). A qualifying country offer is subject to the domestic content
requirement for end products that are wholly or predominantly of iron or steel or a
combination of both.
• (E) Otherwise, apply the 50 percent evaluation factor to the low foreign offer
• (1) If the price of the low domestic offer is less than the evaluated price of the low foreign offer,
award on the low domestic offer (see example in PGI 225.504(3))
• (2) If the evaluated price of the low foreign offer remains less than the low domestic offer, award on
the low foreign offer (see example in PGI 225.504(4))

• (iii) If price is not the determining factor, use the following procedures:
• (A) If there are domestic offers, apply the 50 percent Buy American or Balance of Payments Program
evaluation factor to all foreign offers unless an exemption applies
• (B) Evaluate in accordance with the criteria of the solicitation
• (C) If these procedures will not result in award on a domestic offer, reevaluate offers without the 50
percent factor. If this will result in award on an offer to which the Buy American statute or Balance of
Payments Program applies, but evaluation in accordance with paragraph (c)(ii) of this section would
result in award on a domestic offer, proceed with award only after execution of a determination in
accordance with 225.103(a)(ii)(B), that domestic preference would be inconsistent with the public interest
• (iv) If the solicitation includes the provision at 252.225-7023, Preference for Products or Services
from Afghanistan, use the evaluation procedures at 225.7703-3.

Berry Amendment
• DoD imposes additional domestic source restrictions for certain supplies:
• 10 U.S.C. 4861: Determinations of public interest under chapter 83 of title 41
(BAA)
• Restrictions are included in:
• 10 U.S.C. 4862, Requirement to Buy Certain Articles from American Sources
• 10 U.S.C. 4863, Requirement to Buy Strategic Materials Critical to National
Security from American Sources

4862: Requirement to Buy Certain Articles from American Sources
• “[F]unds appropriated or otherwise available to the Department of Defense may not be used for
the procurement of [a covered item] if the item is not grown, reprocessed, reused, or
produced in the United States”
• Covered items include “an article or item of (a) food; (b) clothing and the materials and
components thereof, other than sensors, electronics, or other items added to, and not normally
associated with, clothing (and the materials and components thereof); (c) tents (and the
structural components thereof), tarpaulins, or covers; (d) cotton and other natural fiber
products, woven silk or woven silk blends, spun silk yarn for cartridge cloth, synthetic fabric or
coated synthetic fabric (including all textile fibers and yarns that are for use in such fabrics),
canvas products, or wool (whether in the form of fiber or yarn or contained in fabrics, materials,
or manufactured articles); or (e) any item of individual equipment manufactured from or
containing such fibers, yarns, fabrics, or materials” and “hand or measuring tools”
10 U.S.C. 4862

4862 Exceptions
• Restrictions do not apply:
• To the extent that the Secretary of Defense or the Secretary of the military department concerned
determines that satisfactory quality and sufficient quantity of any such article or item…grown,
reprocessed, reused, or produced in the United States cannot be procured as and when needed at
United States market prices
• Procurements outside the United States in support of combat operations or procurements…in support of
contingency operations
• Procurements by vessels in foreign waters
• Emergency procurements or procurements of perishable foods by, or for, an establishment located
outside the United States for the personnel attached to such establishment
• Procurements…for which the use of procedures other than competitive procedures has been approved…
relating to unusual and compelling urgency of need

4862 Exceptions (cont’d)
• Restrictions do not apply:
• Procurement of chemical warfare protective clothing produced outside the United States in certain
circumstances
• Procurement of foods manufactured or processed in the United States
• Procurement of waste and byproducts of cotton and wool fiber for use in the production of
propellants and explosives
• Items purchased for resale purposes in commissaries, exchanges, or non-appropriated fund
instrumentalities operated by the DoD
• Purchases for amounts not greater than the simplified acquisition threshold (i.e. $250,000)

DFARS 225.7002, Restricted Materials
• Implements 10 U.S.C. 4862
• Agencies are restricted from using appropriated or other funding available to DoD to buy:
• An article or item of food; clothing; tents, tarpaulins, or covers; cotton and other natural fiber
products; woven silk or woven silk blends; spun silk yarn for cartridge cloth; synthetic fabric or
coated synthetic fabric (including all textile fibers and yarns for use in such fabrics); canvas
products; wool (whether in form of fiber or yarn or contained in fabrics, materials, or
manufactured articles); or any item of individual equipment (Federal Supply Class 8465)
manufactured from or containing such fibers, yarns, fabrics, or materials; and hand or
measuring tools.
• Unless wholly of U.S. origin
• Items must be “grown, reprocessed, reused, or produced” in the U.S.
• DoD cannot use appropriated or otherwise available funds to purchase a covered item, unless that item
is “entirely” grown, reprocessed, reused, or produced within the U.S.

DFARS 225.7002-2, Exceptions
• Contains very specific exceptions
• The exceptions contemplate nonavailability:
• Acquisitions of any of the items in 225.7002–1, if the Secretary concerned determines that
items grown, reprocessed, reused, or produced in the United States cannot be acquired as
and when needed in a satisfactory quality and sufficient quantity at U.S. market prices. (See
the requirement in 205.301 for synopsis within 7 days after contract award when using this
exception.)
• The supporting documentation for the determination shall include an analysis and written
certification by the requiring activity, with specificity, why alternatives that would not require
a domestic nonavailability determination are unacceptable
• Acquisitions of items listed in FAR 25.104(a)

4863: Requirement to Buy Strategic Materials Critical to National Security from
American Sources
• “[A]cquisition by the Department of Defense of the following items is prohibited:
• (1) the following types of end items, or components thereof, containing a specialty metal not
melted or produced in the United States: aircraft, missile and space systems, ships,
tanks and automotive items, weapon systems, or ammunition;
• (2) a specialty metal that is not melted or produced in the United States and that is to be
purchased directly by the Department of Defense or a prime contractor of the
Department.”
• 10 U.S.C. 4863(a)

4863 Exceptions
• The Specialty Metal restrictions do not apply:
• To the extent that the Secretary of Defense or the Secretary of the military department
concerned determines that compliant specialty metal of satisfactory quality and sufficient
quantity, and in the required form, cannot be procured as and when needed. For
purposes of the preceding sentence, the term “compliant specialty metal” means specialty
metal melted or produced in the United States
• Acquisitions outside the United States in support of combat operations or in support of
contingency operations
• Acquisitions for which the use of procedures other than competitive procedures has been
approved…relating to unusual and compelling urgency of need

• If the acquisition is necessary (a) to comply with agreements with foreign government
requiring the United States to purchase supplies from foreign sources … , or (b) in
furtherance of agreements with foreign governments in which both such governments
agree to remove barriers to purchases of supplies produced in the other country or services
performed by sources of the other country, and (2) any such agreement with a foreign
government complies…with the requirements of section 36 of the Arms Export Control Act (22
USC 2776) and with section 2547 of this title
• Items purchased for resale purposes in commissaries, exchanges, and nonappropriated fund
instrumentalities operated by the Department of Defense
• Acquisitions in amounts not greater than the simplified acquisition threshold (i.e., less than
$250,000)
• Acquisitions of electronic components, unless the Secretary of Defense…determines that the
domestic availability of a particular electronic component is critical to national security

• Contracts or subcontracts for the acquisition of [COTS]…other than:
• contracts or subcontracts for the acquisition of specialty metals, including mill products, such as bar,
billet, slab, wire, plate and sheet, that have not been incorporated into end items, subsystems, assemblies,
or components;
• contracts or subcontracts for the acquisition of forgings or castings of specialty metals, unless such
forgings or castings are incorporated into [COTS] end items, subsystems, or assemblies;
• contracts or subcontracts for commercially available high performance magnets unless such high
performance magnets are incorporated into COTS end items or subsystems; and (d) contracts or
subcontracts for [COTS] fasteners, unless such fasteners are (i) incorporated into COTS end items,
subsystems, assemblies, or components, or (ii) purchased…under a contract or subcontract with a
manufacturer of such fasteners, if the manufacturer has certified that it will purchase, during the relevant
calendar year, an amount of domestically melted specialty metal, in the required form, for use in the
production of such fasteners for sale to the [DoD] and other customers, that is not less than 50 percent of
the total amount of the specialty metal that it will purchase to carry out the production of such fasteners

DFARS 225.7003, Specialty Metals
• “Specialty Metal”
• “Specialty metal” means steel, with a maximum alloy content exceeding one or more of the
following limits: manganese, 1.65%; silicon, 0.60%; or copper, 0.60%; or containing more than
0.25% of aluminum, chromium, cobalt, molybdenum, nickel, niobium, (columbium), titanium,
tungsten, or vanadium; metal alloys consisting of nickel or iron-nickel alloys that contain a
total of alloying metals other than nickel and iron in excess of 10% or cobalt alloys that
contain a total of alloying metals other than cobalt and iron in excess of 10%; titanium and
titanium alloys; or zirconium and zirconium alloys

DFARS 225.7003-2, Restrictions
• Agencies are restricted from acquiring the following items or any components of the following
items, unless specialty metals contained in items / components are melted or produced in the
U.S.
• Aircraft; missile or space systems; ships; tank or automotive items; weapon systems;
ammunition
• Note that this restriction does not apply to items manufactured in a qualifying country
or containing specialty metals melted or produced in a qualifying country (DFARS
225.7003-3(b)(4), DFARS 252.225-7009)
• Agencies are also restricted from acquiring specialty metal as an end item, unless the specialty
metal is melted or produced in the U.S. The restriction also applies to specialty metals acquired
by a DoD contractor for delivery to the DoD (see DFARS 252.225-7008)

DFARS 252.225-7008, Restriction on Acquisition of Specialty Metals
(b) Any specialty metal delivered under this contract shall be melted or produced in
the United States or its outlying areas
NOTE: No exception for qualifying countries!

DFARS 252.225-7009, Restriction on Acquisition of Certain Articles Containing
Specialty Metals – Restriction
• (b) Restriction. Except as provided in paragraph (c) of this clause, any specialty
metals incorporated in items delivered under this contract shall be melted or
produced in the United States, its outlying areas, or a qualifying country

Specialty Metals – Exceptions
• (c) Exceptions. The restriction in paragraph (b) of this clause does not apply to—
• (1) Electronic components.
• (2)(i) Commercially available off-the-shelf (COTS) items, other than—
• (A) Specialty metal mill products, such as bar, billet, slab, wire, plate, or sheet, that have not been incorporated
into COTS end items, subsystems, assemblies, or components;
• (B) Forgings or castings of specialty metals, unless the forgings or castings are incorporated into COTS end items,
subsystems, or assemblies;
• (C) Commercially available high performance magnets that contain specialty metal, unless such high
performance magnets are incorporated into COTS end items or subsystems; and
• (D) COTS fasteners, unless—
• (1) The fasteners are incorporated into COTS end items, subsystems, assemblies, or components; or
• (2) The fasteners qualify for the commercial item exception in paragraph (c)(3) of this clause.
• (ii) A COTS item is considered to be “without modification” if it is not modified prior to contractual acceptance by the
next higher tier in the supply chain.

Specialty Metals – Exceptions (cont.)
• (A) Specialty metals in a COTS item that was accepted without modification by the next higher tier are excepted from the restriction in
paragraph (b) of this clause, and remain excepted, even if a piece of the COTS item subsequently is removed (e.g., the end is removed
from a COTS screw or an extra hole is drilled in a COTS bracket).
• (B) Specialty metals that were not contained in a COTS item upon acceptance, but are added to the COTS item after acceptance, are
subject to the restriction in paragraph (b) of this clause (e.g., a special reinforced handle made of specialty metal is added to a COTS
item).
• (C) If two or more COTS items are combined in such a way that the resultant item is not a COTS item, only the specialty metals involved
in joining the COTS items together are subject to the restriction in paragraph (b) of this clause (e.g., a COTS aircraft is outfitted with a
COTS engine that is not the COTS engine normally provided with the aircraft).
• (D) For COTS items that are normally sold in the commercial marketplace with various options, items that include such options are also
COTS items. However, if a COTS item is offered to the Government with an option that is not normally offered in the commercial
marketplace, that option is subject to the restriction in paragraph (b) of this clause (e.g. - An aircraft is normally sold to the public with
an option for installation kits. The Department of Defense requests a military-unique kit. The aircraft is still a COTS item, but the
military-unique kit is not a COTS item and must comply with the restriction in paragraph (b) of this clause unless another exception
applies).
• (3) Fasteners that are commercial products, if the manufacturer of the fasteners certifies it will purchase, during the relevant calendar year,
an amount of domestically melted or produced specialty metal, in the required form, for use in the production of fasteners for sale to the
Department of Defense and other customers, that is not less than 50 percent of the total amount of the specialty metal that it will purchase
to carry out the production of such fasteners for all customers.

Specialty Metals – Exceptions (cont.)
• (4) Items manufactured in a qualifying country.
• (5) Specialty metals for which the Government has determined in accordance with DFARS 225.7003-3 that specialty metal
melted or produced in the United States, its outlying areas, or a qualifying country cannot be acquired as and when
needed in—
• (i) A satisfactory quality;
• (ii) A sufficient quantity; and
• (iii) The required form. In accordance with 10 U.S.C. 4863(m)(4), the term “required form” in this clause refers to the
form of the mill product, such as bar, billet, wire, slab, plate, or sheet, in the grade appropriate for the production of a
finished end item to be delivered to the Government under this contract; or a finished component assembled into an
end item to be delivered to the Government under this contract.
• (6) End items containing a minimal amount of otherwise noncompliant specialty metals (i.e., specialty metals not melted or
produced in the United States, an outlying area, or a qualifying country, that are not covered by one of the other
exceptions in this paragraph (c)), if the total weight of such noncompliant metals does not exceed 2 percent of the total
weight of all specialty metals in the end item, as estimated in good faith by the Contractor. This exception does not apply
to high performance magnets containing specialty metals.

Specialty Metals – Subcontracts
• (e) Subcontracts.
• (1) The Contractor shall exclude and reserve paragraph (d) and this paragraph (e)(1) when flowing down
this clause to subcontracts.
• (2) The Contractor shall insert paragraphs (a) through (c) and this paragraph (e)(2) of this clause in
subcontracts, including subcontracts for commercial products, that are for items containing specialty
metals to ensure compliance of the end products that the Contractor will deliver to the Government.
When inserting this clause in subcontracts, the Contractor shall—
• (i) Modify paragraph (c)(6) of this clause only as necessary to facilitate management of the minimal
content exception at the prime contract level. The minimal content exception does not apply to
specialty metals contained in high-performance magnets; and
• (ii) Not further alter the clause other than to identify the appropriate parties.

DFARS Subpart 225.70 – Authorization Acts, Appropriations Acts, and Other
Statutory Restrictions on Foreign Acquisition
• Restriction on Ball and Roller Bearings
• Restriction on Anchor and Mooring Chain
• Restriction on Supercomputers
• Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation
• In accordance with section 2821 of the National Defense Authorization Act for Fiscal Year 2020
(Pub. L. 116–92), contracts for the acquisition of furnished energy for a covered military
installation shall not use any energy sourced from inside the Russian Federation as a means of
generating the furnished energy for the covered military installation. DFARS 225.7019-2.
• Etc.

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The DFARS – 2025
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DFARS Part 225 - Foreign Acquisition DFARS

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