Where the TAA applies, the law and the terms of application prohibit agencies from purchasing products or services that do not originate in the United States or from a “designated country” that has a free trade agreement with the United States. While the list of “designated countries” includes a wide range of countries that are parties to various free trade agreements – including the World Trade Organization (WTO) Public Procurement Agreement (GPA) and some bilateral trade agreements between the United States and individual countries – there are a number of countries (including China and India, two notable examples) that are not “designated countries” for TAA purposes. The Trade Agreements Act was passed to regulate trade agreements between the United States and abroad. One of the main features of the act is that it limits purchases by the U.S. government to products or products manufactured in the United States and manufactured in certain countries. Such products are then called “TAA compliant.” However, the TAA does not limit foreign trade outside the scope of federal contracts. This means that you can freely sell non-TAA-compliant products on the commercial market. In early May 2016, the U.S. General Services Administration (GSA) announced to thousands of Federal Supply Schedule (FSS) contract holders that it was increasingly reviewing compliance with the Schedule Holder`s Trade Agreements Act (TAA). These notices, which have received extensive coverage in the trade press, require contractors who have certain FSS contracts to verify the country of origin of the products according to their GSA plans and to remove non-compliant products from their schedules. According to GSA, these notices were fuelled in part by increased congressional verification following violations reported to the TAA. Although the notices were allegedly directed towards certain FSS contracts, these notices are an important warning to all FSS policyholders as well as to all other public contractors submitted to the TAA as to the importance of this issue. Indeed, a number of recent cases of the False Claims Act involving the TAA still illustrate the risks and serious consequences for contractors who do not meet these requirements.
Therefore, all flight plan holders and other public contractors subject to the TAA should take this opportunity to ensure that they have appropriate controls in place to ensure that products and services sold to the government are compliant with the AAA.