FAR 52.225-23—Required Use of American Iron, Steel, and Manufactured Goods-Buy American Statute-Construction Materials under Trade Agreements.
Plain-English Summary
FAR 52.225-23 is the construction-specific domestic preference clause used when the Buy American statute and trade agreements both matter for a federal construction acquisition. It defines the key terms that determine whether a material is treated as domestic, foreign, designated-country, or Recovery Act designated-country, and it explains how to classify construction materials, manufactured materials, unmanufactured materials, components, and special items such as emergency life safety systems. The clause also ties those definitions to the legal regimes that may apply to a project, including the Buy American statute, the Trade Agreements Act framework, and Recovery Act rules. In practice, this clause tells contractors what materials may be used, how origin and transformation are evaluated, and when a material from a partner country can be treated more favorably than a nondesignated-country product. It is especially important on construction projects because the origin of a material can turn on where it was mined, produced, manufactured, or substantially transformed, and because some items are evaluated as a single construction material even if delivered in parts. The clause is also significant because it supports compliance, pricing, sourcing, and subcontracting decisions before materials are purchased or installed.
Key Rules
Construction material definition
A construction material is any article, material, or supply brought to the site by the contractor or subcontractor for incorporation into the building or work, including items delivered preassembled. This definition is broad and is the starting point for deciding whether a product is subject to the clause.
Component versus material
A component is an article, material, or supply incorporated directly into a construction material. This matters because the origin of the finished construction material may depend on the origin and transformation of its components, especially for manufactured items.
Domestic material test
An unmanufactured construction material is domestic if it is mined or produced in the United States. A manufactured construction material is domestic if it is manufactured in the United States and, when it is wholly or predominantly iron or steel, the iron or steel was also produced in the United States.
Foreign material definition
Any construction material that does not meet the domestic definition is foreign construction material. This is the default category for materials that fail the U.S.-origin or applicable trade-agreement origin tests.
Designated-country treatment
Materials from designated countries may receive favorable treatment under the clause. The clause identifies designated countries through WTO GPA countries, FTA countries, least developed countries, and Caribbean Basin countries, and defines when a material qualifies as a designated-country construction material.
Substantial transformation standard
For FTA country and least developed country construction materials, a product can qualify if it is wholly the growth, product, or manufacture of that country, or if materials from another country were substantially transformed there into a new and different construction material. This is a key origin test for mixed-source products.
Recovery Act country rules
The clause separately defines Recovery Act designated countries and Recovery Act designated-country construction materials. These definitions matter when a project or funding source triggers Recovery Act domestic preference requirements rather than, or in addition to, the standard Buy American framework.
Emergency life safety systems
Discrete emergency life safety systems such as emergency lighting, fire alarm, and audio evacuation systems are evaluated as a single and distinct construction material when they are complete systems incorporated into a public building or work. Their individual parts are not separately analyzed for origin in the same way as ordinary assembled items.
Responsibilities
Contracting Officer
Insert the clause when prescribed, identify the applicable domestic preference regime for the acquisition, and ensure the solicitation and contract reflect the correct treatment of domestic, foreign, designated-country, and Recovery Act materials. The contracting officer must also evaluate exceptions, trade-agreement applicability, and any project-specific sourcing restrictions.
Contractor
Classify each construction material correctly, determine whether it is domestic, foreign, or designated-country material, and ensure purchased and installed materials comply with the clause and any other applicable domestic preference requirements. The contractor must maintain sourcing and origin documentation and flow requirements to subcontractors and suppliers.
Subcontractor
Provide accurate origin and manufacturing information for materials it supplies or installs, and comply with the prime contractor’s sourcing and documentation requirements. Subcontractors must not substitute materials without confirming compliance with the applicable preference rules.
Agency
Apply the correct statutory and regulatory framework to the project, including any trade-agreement or Recovery Act considerations, and support consistent interpretation of country lists and material classifications. The agency must also ensure procurement planning aligns with the funding source and project type.
Supplier/Manufacturer
Provide truthful product-origin, manufacturing, and transformation information so the contractor can determine whether a material qualifies as domestic or designated-country. Suppliers should be prepared to substantiate claims about where a product was mined, produced, manufactured, or substantially transformed.
Practical Implications
This clause is a sourcing and compliance checkpoint: contractors should verify origin before buying, not after delivery, because the domestic preference outcome can change based on where manufacturing or substantial transformation occurred.
The country lists are central to compliance, but they are not enough by themselves; a product from a designated country still has to meet the specific construction-material test in the clause.
Mixed-source manufactured products are a common pitfall. Contractors often need to trace components and transformation steps to determine whether the finished item qualifies as domestic, FTA-country, least developed country, or foreign.
Emergency life safety systems are treated differently from ordinary assemblies, so contractors should not break them into parts for separate origin analysis when the clause says they are evaluated as a single construction material.
Documentation matters. In practice, the safest approach is to keep supplier certifications, manufacturing records, bills of material, and country-of-origin evidence available for audit, substitution review, and closeout questions.
Official Regulatory Text
As prescribed in 25.1102 (e) , insert the following clause: Required Use of American Iron, Steel, and Manufactured Goods-Buy American Statute-Construction Materials under Trade Agreements (Nov 2023) (a) Definitions . As used in this clause— Component means an article, material, or supply incorporated directly into a construction material. Construction material means an article, material, or supply brought to the construction site by the Contractor or subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Designated country means any of the following countries: (1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan, Ukraine, or United Kingdom); (2) A Free Trade Agreement (FTA) country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Oman, Panama, Peru, or Singapore); (3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or (4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago). Designated country construction material means a construction material that is a WTO GPA country construction material, an FTA country construction material, a least developed country construction material, or a Caribbean Basin country construction material. Domestic construction material means the following: (1) An unmanufactured construction material mined or produced in the United States. (The Buy American statute applies.) (2) A manufactured construction material that is manufactured in the United States and, if the construction material consists wholly or predominantly of iron or steel, the iron or steel was produced in the United States. (Section 1605 of the Recovery Act applies.) Foreign construction material means a construction material other than a domestic construction material. Free trade agreement (FTA) country construction material means a construction material that- (1) Is wholly the growth, product, or manufacture of an FTA country; or (2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in an FTA country into a new and different construction material distinct from the materials from which it was transformed. Least developed country construction material means a construction material that- (1) Is wholly the growth, product, or manufacture of a least developed country; or (2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed. Manufactured construction material means any construction material that is not unmanufactured construction material. Nondesignated country means a country other than the United States or a designated country. Recovery Act designated country means any of the following countries: (1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan, Ukraine, or United Kingdom); (2) A Free Trade Agreement country (FTA) (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Oman, Panama, Peru, or Singapore); or (3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia). Recovery Act designated country construction material means a construction material that is a WTO GPA country construction material, an FTA country construction material, or a least developed country construction material. Steel means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements. United States means the 50 States, the District of Columbia, and outlying areas. Unmanufactured construction material means raw material brought to the construction site for incorporation into the building or work that has not been- (1) Processed into a specific form and shape; or (2) Combined with other raw material to create a material that has different properties than the properties of the individual raw materials. WTO GPA country construction material means a construction material that- (1) Is wholly the growth, product, or manufacture of a WTO GPA country; or (2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed. (b) Construction materials. (1) The restrictions of section 1605 of the American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5) (Recovery Act) do not apply to Recovery Act designated country manufactured construction material. The restrictions of the Buy American statute do not apply to designated country unmanufactured construction material. Consistent with U.S. obligations under international agreements, this clause implements- (i) Section 1605 of the Recovery Act by requiring, unless an exception applies, that all manufactured construction material in the project is manufactured in the United States and, if the construction material consists wholly or predominantly of iron or steel, the iron or steel was produced in the United States (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives); and. (ii) The Buy American statute by providing a preference for unmanufactured construction material mined or produced in the United States over unmanufactured construction material mined or produced in a nondesignated country. (2) The Contractor shall use only domestic construction material, Recovery Act designated country manufactured construction material, or designated country unmanufactured construction material in performing this contract, except as provided in paragraphs (b)(3) and (b)(4) of this clause. (3) The requirement in paragraph (b)(2) of this clause does not apply to the construction materials or components listed by the Government as follows: [ Contracting Officer to list applicable excepted materials or indicate "none". ] (4) The Contracting Officer may add other construction material to the list in paragraph (b)(3) of this clause if the Government determines that- (i) The cost of domestic construction material would be unreasonable; (A) The cost of domestic manufactured construction material is unreasonable when the cumulative cost of such material, when compared to the cost of comparable foreign manufactured construction material, other than Recovery Act designated country construction material, will increase the overall cost of the contract by more than 25 percent; (B) The cost of domestic unmanufactured construction material is unreasonable when the cost of such material exceeds the cost of comparable foreign unmanufactured construction material, other than designated country construction material, by more than 20 percent; (ii) The construction material is not mined, produced, or manufactured in the United States in sufficient and reasonably available commercial quantities of a satisfactory quality; or (iii) The application of the restriction of section 1605 of the Recovery Act to a particular manufactured construction material would be inconsistent with the public interest or the application of the Buy American statute to a particular unmanufactured construction material would be impracticable or inconsistent with the public interest. (c) Request for determination of inapplicability of section 1605 of the Recovery Act or the Buy American statute . (1) (i) Any Contractor request to use foreign construction material in accordance with paragraph (b)(4) of this clause shall include adequate information for Government evaluation of the request, including- (A) A description of the foreign and domestic construction materials; (B) Unit of measure; (C) Quantity; (D) Cost; (E) Time of delivery or availability; (F) Location of the construction project; (G) Name and address of the proposed supplier; and (H) A detailed justification of the reason for use of foreign construction materials cited in accordance with paragraph (b)(4) of this clause. (ii) A request based on unreasonable cost shall include a reasonable survey of the market and a completed cost comparison table in the format in paragraph (d) of this clause. (iii) The cost of construction material shall include all delivery costs to the construction site and any applicable duty. (iv) Any Contractor request for a determination submitted after contract award shall explain why the Contractor could not reasonably foresee the need for such determination and could not have requested the determination before contract award. If the Contractor does not submit a satisfactory explanation, the Contracting Officer need not make a determination. (2) If the Government determines after contract award that an exception to section 1605 of the Recovery Act or the Buy American statute applies and the Contracting Officer and the Contractor negotiate adequate consideration, the Contracting Officer will modify the contract to allow use of the foreign construction material. However, when the basis for the exception is the unreasonable cost of a domestic construction material, adequate consideration is not less than the differential established in paragraph (b)(4)(i) of this clause. (3) Unless the Government determines that an exception to section 1605 of the Recovery Act or the Buy American statute applies, use of foreign construction material other than manufactured construction material from a Recovery Act designated country or unmanufactured construction material from a designated country is noncompliant with the applicable statute. (d) Data . To permit evaluation of requests under paragraph (c) of this clause based on unreasonable cost, the Contractor shall include the following information and any applicable supporting data based on the survey of suppliers: Foreign (Nondesignated Country) and Domestic Construction Materials Cost Comparison Construction Material Description Unit of Measure Quantity Cost (Dollars)* Item 1 : Foreign construction material ________ ________ ________ Domestic construction material ________ ________ ________ Item 2 : Foreign construction material ________ ________ ________ Domestic construction material ________ ________ ________ [ List name, address, telephone number, and contact for suppliers surveyed. Attach copy of response; if oral, attach summary. ] [ Include other applicable supporting information .] [* Include all delivery costs to the construction site .] (End of clause) Alternate I (Nov 2023) . As prescribed in 25.1102 (e), add the following definition of "Bahraini, Mexican, or Omani construction material" to paragraph (a) of the basic clause, and substitute the following paragraphs (b)(1) and (b)(2) for paragraphs (b)(1) and (b)(2) of the basic clause: Bahraini, Mexican, or Omani construction material means a construction material that- (1) (1) Is wholly the growth, product, or manufacture of Bahrain, Mexico, or Oman; or (2) (2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain, Mexico, or Oman into a new and different construction material distinct from the materials from which it was transformed. (b) Construction materials. (1) The restrictions of section 1605 of the American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5) (Recovery Act) do not apply to Recovery Act designated country manufactured construction material. The restrictions of the Buy American statute do not apply to designated country unmanufactured construction material. Consistent with U.S. obligations under international agreements, this clause implements- (i) Section 1605 of the Recovery Act, by requiring, unless an exception applies, that all manufactured construction material in the project is manufactured in the United States and, if the construction material consists wholly or predominantly of iron or steel, the iron or steel was produced in the United States (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives); and (ii) The Buy American statute by providing a preference for unmanufactured construction material mined or produced in the United States over unmanufactured construction material mined or produced in a nondesignated country. (2) The Contractor shall use only domestic construction material, Recovery Act designated country manufactured construction material, or designated country unmanufactured construction material, other than Bahraini, Mexican, or Omani construction material, in performing this contract, except as provided in paragraphs (b)(3) and (b)(4) of this clause.