Revised U.S. Procurement Thresholds

items of note.v1.yellow & red boundaryOn December 15, 2015, the U.S. Trade Representative (USTR) published revised thresholds that apply to U.S. federal and state procurement covered by the WTO Government Procurement Agreement (GPA) and free trade agreements (FTAs) for the calendar years 2016 and 2017. Thresholds are a key element in determining whether procurement is covered by a trade agreement. U.S. procurement valued at or above the specified thresholds must be conducted in accordance with the agreements. The USTR threshold determination was published in the Federal Register (80 FR 77694, Dec. 15, 2015).

USTR adjusts the U.S. dollar value of thresholds every two years in accordance with formula specified in the agreements. The GPA thresholds are set out in Special Drawing Rights (SDRs) and the U.S. and other GPA parties convert the value of the thresholds into their own national currencies.

The new revised GPA threshold for goods and services purchased by federal government entities is $191,000 and the adjusted threshold for states is $522,000. The new construction services threshold for both federal and state entities is $7,358,000. The revised dollar values of the thresholds are slightly lower than the 2014-15 values.

Based on the USTR threshold determination, the Federal Acquisition Regulation (FAR) has been amended to incorporate the revised thresholds (see 80 FR 81894, Dec. 31, 2015). The FAR at Part 25.402 includes a chart with the thresholds applicable to federal procurement covered by the GPA and FTAs. The adjusted thresholds became effective on January 1, 2016 and will apply through December 31, 2017.

Jean Heilman Grier

January 15, 2016