Buy American Act (BAA)

The Buy American Act applies to direct federal purchases of manufactured articles above the micro-purchase threshold. Two tests must both be met: the article has to be manufactured in the United States, and the cost of its domestic components has to exceed a threshold percentage of the cost of all components. That threshold is 65 percent for items delivered in calendar year 2026, rising to 75 percent for items delivered from 2029. A fallback of 55 percent may be accepted where no product meeting the higher threshold is available, and that fallback expires one year after the 75 percent threshold takes effect.

The Buy American Act is not the Trade Agreements Act, and it is not Build America Buy America. The three use different tests, apply to different purchases, and a product can satisfy one and fail another. A supplier claiming to be "Buy American compliant" without naming which statute and which test is not telling a procurement officer enough to act on.

The Buy American Act and the Federal Trade Commission's "Made in USA" standard are different tests applied by different regulators. The Buy American Act is a federal procurement rule with a domestic content threshold. The FTC standard governs marketing claims to the public and requires that a product be all or virtually all made in the United States, meaning final assembly, all significant processing, and essentially all components of U.S. origin.

A product can satisfy the Buy American Act and still not meet the FTC standard. A supplier using the two phrases interchangeably is describing two different things.