> ### Subpart 25.3- Balance of Payments Program

> ## 25.300 Scope of subpart.

> This subpart provides policies and procedures implementing the Balance of Payments Program. It applies to contracts for the purchase of supplies for use outside the United States, and contracts for construction, alteration, or repair of any public building or public work outside the United States.

> ## 25.301 General.

> The Balance of Payments Program restricts the purchase of supplies that are not domestic end products, for use outside the United States, and restricts the use of construction materials that are not domestic, for performance of construction contracts outside the United States. Its restrictions are similar to those of the Buy American Act. It uses the same definitions and evaluation procedures, except that a 50 percent factor generally is used to determine unreasonable cost. Exceptions to the Balance of Payments Program, especially for construction materials, are generally determined prior to solicitation and assignment of contracting responsibility. The contracting officer must identify excepted supplies and construction materials in the contract.

> ## 25.302 Policy.

> Except as provided in 25.303, acquire only domestic end products for use outside the United States, and use only domestic construction materials for construction, repair, or maintenance of real property outside the United States.

> ## 25.303 Exceptions.

> A foreign end product may be acquired for use outside the United States, or a foreign construction material may be used in construction outside the United States, without regard to the restrictions of the Balance of Payments Program if-

> (a) The estimated cost of the end product does not exceed the simplified acquisition threshold;
> (b) The end product or construction material is listed at 25.104, or the head of the contracting activity determines that a requirement-
> (1) Can only be filled by a foreign end product or construction material (see 25.103(b));
> (2) Is for end products or construction materials that, by their nature or as a practical matter, can only be acquired in the geographic area concerned, e.g., ice or books; or bulk material, such as sand, gravel, or other soil material, stone, concrete masonry units, or fired brick; or
> (3) Is for perishable subsistence products and delivery from the United States would significantly impair their quality at the point of consumption;
> (c) The acquisition of foreign end products is required by a treaty or executive agreement between governments;
> (d) The end products are-
> (1) Petroleum products; or
> (2) For commissary resale;
> (e) The end products are eligible products subject to the Trade Agreements Act, NAFTA, or the Israeli Trade Act, or the construction material is subject to the Trade Agreements Act or NAFTA;
> (f) The cost of the domestic end product or construction material (including transportation and handling costs) exceeds the cost of the foreign end product or construction material by more than 50 percent, or a higher percentage specifically authorized by the head of the agency; or
> (g) The head of the agency has determined that it is not in the public interest to apply the restrictions of the Balance of Payments Program to the end product or construction material or that it is impracticable to apply the restrictions of the Balance of Payments Program to the construction material.

> ## 25.304 Procedures.

> (a) Solicitation of offers. The contracting officer must identify, in the solicitation, supplies and construction materials known in advance to be excepted from the procedures of this subpart.
> (b) Evaluation of offers. The contracting officer must-
> (1) Evaluate offers for supplies in accordance with Subpart 25.5; and
> (2) Evaluate offers proposing foreign construction material by using the procedures at 25.204, except that a factor of 50 percent or a higher percentage (see 25.303(f)) must be applied to foreign construction material proposed for exception from the requirements of the Balance of Payments Program on the basis of unreasonable cost of domestic construction materials.
> (c) Other procedures for construction. For construction contracts, the procedures at 25.203, 25.205, and 25.206, for determinations and noncompliance under the Buy American Act, are also applicable to determinations and noncompliance under the Balance of Payments Program.