TRS Research, B-285514, August 7, 2000

B-285514 Aug 07, 2000 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights DIGEST Agency reasonably determined that protester's refurbished foreign-made cargo containers were not domestic products eligible for an evaluation preference pursuant to the Buy American Act where the steps the protester takes to refurbish the imported containers in the United States do not constitute "manufacturing" within the meaning of the Act. That TRS's containers are not domestic end products eligible for an evaluation preference pursuant to the Buy American Act. The RFQ was issued on an unrestricted basis for 18 used ammunition-grade cargo containers under the streamlined commercial acquisition procedures set forth in Subpart 12.6 of the Federal Acquisition Regulation (FAR). Using a combined synopsis/solicitation which was posted on the Commerce Business Daily Net on May 10. View Decision Matter of: TRS Research File: B-285514 Date: August 7, 2000 DIGEST Attorneys DECISION TRS Research protests the agency's determination under request for quotations (RFQ) No. DAMT01-00-T-0016, issued by the Department of the Army for cargo containers, that TRS's containers are not domestic end products eligible for an evaluation preference pursuant to the Buy American Act, 41 U.S.C. Secs. 10a-10d (1994). We deny the protest. The RFQ was issued on an unrestricted basis for 18 used ammunition-grade cargo containers under the streamlined commercial acquisition procedures set forth in Subpart 12.6 of the Federal Acquisition Regulation (FAR), using a combined synopsis/solicitation which was posted on the Commerce Business Daily Net on May 10, 2000. See FAR Sec. 12.603(a); Agency Report (AR) exh. 3. The RFQ required that the containers be designed to facilitate the transportation of hazardous/explosive cargo by road, rail, and sea, and contained detailed specifications including, for instance, dimensions, construction materials, primary structural components (e.g., flooring, corner fittings, corner posts, door sill and header, top and bottom end rails, and forklift pockets), and paint. AR exh. 3, RFQ, at 2. The RFQ also contained FAR Sec. 52.225-3, which implements the Act by providing an evaluation preference for domestic end products. /1/ The agency received quotes from five firms, including two from TRS, by the May 18 due date. In its first quote, TRS stated that the major components of the containers were produced in China, then shipped to the United States and purchased by TRS in scrap condition. AR exh. 6, TRS Quotation, at 1. TRS also stated in that quote that the new product "shall contain more than 51 Percent domestic content and effort," and that, therefore, "this product [is] a newly manufactured US domestic end product." Id. In its second quote, TRS stated that the offered containers were manufactured in China, then shipped to the United States with cargo and purchased by TRS. AR exh. 6, TRS Alternate Quotation, at 1. The contracting officer (CO) concluded that the foreign-made containers TRS offered were not domestic end products eligible for an evaluation preference pursuant to the Act. In fact, the CO determined that none of the vendors offered a domestic end product, and issued a purchase order to CIR-NAV Agencies, Inc. as the low-priced, acceptable vendor. AR exh. 1, CO's Statement, Para. 5, at 2-3. This protest followed. TRS argues that the agency improperly determined that the foreign containers it offered were not domestic products since it refurbishes the containers in the United States to make them compliant with the RFQ requirements, thus transforming the containers into domestic end products. In this connection, TRS states that the refurbishing includes replacing top rails and side panels, straightening dents, replacing cross member and/or forklift pockets as required, undercoating bases and undercarriage, and replacing flooring and roof panels. Protest at 2-3. TRS maintains that its refurbishing effort constitutes "manufacturing" in the United States for purposes of applying the Act's evaluation preference. The Act restricts the purchase of supplies that are not domestic end products. For manufactured products, the DFARS uses a two-part test to define a "domestic end product" for purposes of the Act. Under that test, to qualify as domestic, an end product (1) must be manufactured in the United States, and (2) the cost of its domestic components must exceed 50 percent of the cost of all its components. DFARS Sec. 225.105(5)(i); see also FAR Sec. 25.101; Computer Hut Int'l, Inc., B-249421 et al., Nov. 23, 1992, 92-2 CPD Para. 364 at 4. Here, we think that the agency properly determined that the containers TRS proposed were not domestic products.