The Buy American Act was passed in the 1930s to protect American workers.
This federal regulation is reinforced by the Federal Acquisition Regulations and applies to certain federal contracts and grants above the micropurchase threshold (currently $3,000) and includes flowdown to subrecipients. Awardees must certify that all articles, materials, and supplies funded by these awards are American-made. Exceptions can be made in the case of:
- Unreasonable cost
- Unacceptable quantity or quality
- Use outside the U.S. only
- Conflict with the public interest
- Certain trade agreements
- Commercial items of information technology
- Domestic manufactured products (e.g., engines), if at least 50% of components are U.S.-made
Exceptions to the act must be identified in the project specifications and justified in the public record. False certification may be considered fraud and can result in debarment. The government also publicizes information about noncompliant awardees, who may not participate in federally funded projects for three years from the date that they are found noncompliant.
This act is not the same thing as the Buy America Act of 1983, which applies only to procurement for mass-transit projects.