Executive Order Implements Domestic Preference for Federal Procurement and Federally-Funded Projects


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Domestic preferences in having American made products for contracts and federally-funded projects could disrupt the sales, increase prices and lead to difficult overseas relationships. However, it is possible to increase business and sales within the country when only those manufactured and distributed in the United States are procured.

Domestic preference refers to the use, acquirement, purchase and trade of American made products over that of foreign countries. This is primarily to increase business, revenue and profits for United States citizens and companies within the country. However, a secondary goal may be to inhibit certain countries that have cheaper goods from being imported at the lower costs. This would in turn raise the costs of various goods and services obtained from overseas companies. If a business has a federally-funded project, the owner and management may be required to ensure materials and resources are garnered from domestic organizations.

Federally-funded projects may be at the will and requirements of the agency that is backing these with a company or organization. While the standards and demands to acquire resources and then sell to certain parties are implemented by the agency, the company that is attached to the contract is usually the party that prepares, manufactures and distributes the items created for the arrangements. If the Federal Acquisition Regulation is altered to increase the demand and need for American made and bought items, the business or entity attached to the agreement may be pressed into only obtaining materials, resources and parts from United States manufacturers and companies.

Domestic Preference in Effect

When one country ignores treaties or allied countries when making deals, selling products, trading goods and similar actions, it could lead to tension between nations. Domestic preference in government contracts, federally funded projects and other programs could cause similar reactions when only the United States benefits from these endeavors. While an increase in spending nationally is encouraged and could create a stronger market in America, foreign allies may place greater fees on imports to their nations and states. Commerce is competitive, but when multiple locations have been excluded, this could be seen as an affront.

Domestic preference could also increase the confidence, moral and reliability on products and materials garnered and acquired throughout the country. While some markets may suffer, others could thrive. Some domestic only businesses often flourish when their products and services are purchased with greater frequency for these programs and projects. The advertising, marketing and education about these situations could assist in increasing awareness and cooperation. It is important for authorities to explain why domestic preference could help the country even if only for federal procurement and federally funded projects. Additionally, any legal complications are generally sorted through lawyer assistance.

Federal Aspects of Projects and Procurement

When a person or company has joined a government contract for procurement of materials or resources, he or she is affected by the stipulations set forth in the contractual agreement. The same is necessary for federally funded projects and programs. The domestic preferences issued forth by the White House through an executive order alter what business transactions may be completed by the owner of the company. This then presses him or her into only buying American made or selling within the country. If there are clients from other nations, the conditions could affect the company into not shipping out or trading globally until the contract ends or if the agency permits the commerce.

Federal contracts and projects are often very particular about what may be accomplished. Procurement for materials, resources or assets is important for the company in manufacturing and distributing products. When the preferences are for domestic sales, trading and buying, this could limit the business. However, working within these restrictions, it is possible to excel at making the client happy and acquiring new contracts or projects when the first one has been completed. The domestic preference leads the business owner to only interact with companies and clients within the United States. The idea that this will increase the local and domestic markets affects what is considered necessary. However, contacting and communicating with foreign clients should be accomplished before taking on the project or contract.

Legal Aspects of Federal Procurement and Projects

When a business or individual has the option to take a contract, project or to engage in federal procurement, it is crucial to contact a lawyer first. Many companies have legal representation on hand to assist in determining if these arrangements are best for the organization.

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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.

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