What Does TAA Compliant Mean? Why It Is Important?

What Does TAA Compliant Mean? Why It Is Important?

By: BOB STEGER | Date: 2022-05-24

We have had several clients where they went to add a new product to their GSA schedule only to find out that the product was from a non-TAA Compliance Country, therefore they could not add the product.  In some cases, the product was manufactured in two locations so the firm had to take extra precaution that only the product manufactured in the TAA compliant country would be sold on their GSA Schedule Contract.

The Trade Agreement Act (TAA) came into place in 1979 when Jimmy Carter signed the bill.  It was an improvement upon a prior bill but set the framework for which countries the United States was willing to purchase supplies.

TAA compliant meaning and why TAA compliance is important?

Put this simply, you cannot promote non-Trade Agreements Act-compliant merchandise to the government. Hence, in case you plan to compete for a GSA Schedule agreement, you must verify the real beginning of your merchandise very carefully. And in case you are already awarded, it's far vital will maintain your TAA compliance.

How to keep your products TAA compliant?

Since TAA compliance is crucial for maintaining any GSA schedule contracts you can have, you must continually ensure that your merchandise stays compliant with the necessities of the Trade Agreements Act alongside the whole overall performance length of the agreement. Here is a quick tick list you can need to comply with to make certain TAA-eligibility of your items:

Carefully pick providers of additives, elements, and substances of your synthetic items. The price of your product must be at a minimum of 50% coming from the U.S. or exact international locations.

If your GSA agreement is predicated on transporting items synthetic with the aid of using a third party, ensure those merchandises are synthetic in TAA compliant international locations.

Always make clear the beginning of all supply elements and substances coming out of your companions. Ensure everything has the right delivery documentation and agreements.

Insist on the unique stock of your order more than one element or item your product is predicated upon. You need to make sure the united states of beginning comply with the TAA.

Periodically (as soon as in step with zone or as soon as in step with pricelist update) take a look at the TAA reputation of ordered additives so that you don’t leave out modifications in the beginning of a few crucial parts.

Keep a watch on any modifications and amendments to the TAA and FAR at Acquisition.org. The thresholds and margins or even the listing of GSA compliant international locations may also change!

Understanding TAA Compliance

To surely apprehend what it way to be TAA compliant and make certain that you are following this vital regulation, it is important you as a MAS agreement holder apprehend our 10 techniques mentioned below:

MAS agreement holders need to select the proper producer for their merchandise. Companies along with China, India, Russia, and Malaysia, violate TAA compliance and therefore violate their GSA agreement.

Communication among companions is crucial for preserving a terrific dating in the company, making an allowance for an obligation to be shared for the duration of the managerial oversight at the company’s function.

Ensure the right documentation, which incorporates provider agreements in addition to a letter of delivery agreement.

Correct documentation of the united states of beginning is crucial, along with beginning markings, maximum modern-day USA of beginning, and the best-united states of beginning (COO) code.

Detailed stock is a should, along with pattern merchandise, product markings, and product matching.

Maintenance, each inner and external: Companies ought to be proactive with their MAS agreement, with the aid of using collaborating in sports along with product marketplace sampling and education on an everyday basis.

Monitor U.S. customs and border safety information, which may be located at the CROSS website.

As a MAS agreement holder, you should study any compliance difficulty with the TAA must you word one – permitting you to in the end put off the difficulty.

If you've got completed a huge income with non-TAA compliant united states it's far vital to are looking for expert help.

As a MAS agreement holder, in case you grow to be uncertain approximately any issue of TAA compliance it's far vital to get a recommendation from an expert, who can manual you via the troubles of non-compliance.

These four lists comprise of all the countries that the U.S. Government is willing to buy products

WTO World Trade Organization Countries

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, South Korea, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan, Penghu, Kinmen and Matsu, Ukraine, or United Kingdom

Caribbean Basin Countries

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

Least Developed Countries

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

Free Trade Agreement Countries

Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, South Korea, Mexico, Morocco, Nicaragua, Oman, Panama, Peru, or Singapore

Gray Area

The problem comes into play when a product has parts made in or part of the manufacturing Is completed in a non-TAA compliant country.

Example:  Flashlight where the led bulb used in the flashlight is made in a non-TAA compliant country.  The firm would like to get this on their GSA Schedule Contract.  How is the GSA likely to view this product? 

At first glance this seems like it could go either way.  However, the GSA would deny this as non-TAA compliant.  This is because the flashlight led bulb will cause the product to fail several major TAA tests.

Test 1 – Is the product manufactured in the United States or a TAA compliant Country?

Answer:  The imported component retained its original material composition and shape as a result of the post-importation assembly process.

Test 2 – Was the product “Substantially transformed” in the United States into a new and different article of commerce with a character and name, or use distinct from which it was transformed?

Answer:  The assembly process in the United States was not sufficiently complex, the average flashlight takes under 10-minutes to assemble.

Therefore, the GSA would not allow this product to be sold on the GSA Schedule System. The firm would be forced to either produce this product in a TAA compliant country or forgo the GSA/Federal market.

General Rule:  If over 50% of the value of the product is being transformed in TAA compliant countries than the GSA has typically held that the product can be sold on the GSA Schedule System.  

Problem Children:  Most businesses find that the problem children regarding TAA Compliance revolves around China, Russia, India, and Malaysia.  These four countries are a hot bed for manufacturing and therefore are the most likely to cause problems for GSA firms. Therefore, products that have any components made in these countries should be thoroughly reviewed before the firm attempts to put on a GSA schedule.   

TAA GSA Recommendations

We recommend as best practices for GSA contract holders in dealing with TAA Compliance.  Following these guidelines should help a firm remain issue free:

  • Retain good records of all applicable supplier agreements and letters of supply.
  • Maintain proper and up-to-date country of origin documentation, including origin markings, country of origin code, and the most recent country of origin documents;
    Remain up to date on all product marks, and matching products in the marketplace.
  • Keep up to date with US Customs and investigate any difficulties with TAA compliance quickly.
  • Utilize professional assistance if you are moving large quantities of product from a country that is not TAA-compliant. 


Selling products on the GSA Schedule System is a great way to enhance your firm’s revenue.  To avoid penalties, contractors should make sure that they are compliance with TAA rules and regulations. 

The key takeaway is that the US government will only buy products or services that are made in the US or another “designated country” or have been substantially changed in the US or another “designated country” under TAA.

Therefore, do your due diligence and make sure you are abiding by TAA before you begin selling through your GSA Schedule on GSA Advantage.

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