B-169279, JUN. 1, 1970

B-169279: Jun 1, 1970

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STATUS EVIDENCE UNDER SET-ASIDE FOR SMALL BUSINESS CONCERN WHERE INVITATION REQUIRED THAT BIDDER'S INDICATE WHETHER OR NOT THEY WERE SMALL BUSINESS CONCERN AND IF NOT MANUFACTURER OF SUPPLIES OFFERED WHETHER SUPPLIES WOULD BE MANUFACTURED BY SMALL BUSINESS CONCERNS IN UNITED STATES. LOW BIDDER WHO FAILED TO MAKE ENTRY IN BUY AMERICAN CERTIFICATE BUT LISTED ITSELF AS MANUFACTURER IS ENTITLED TO AWARD SINCE PREAWARD SURVEY REVEALED BIDDER WAS NOT MANUFACTURER BUT ITEMS OFFERED WERE MANUFACTURED BY SMALL BUSINESS CONCERN AND SINCE BIDDER'S MISSTATEMENT WAS MINOR INFORMALITY CORRECTION COULD BE MADE PRIOR TO AWARD. ARE CONSIDERED IN EVALUATING BIDS UNDER BUY AMERICAN ACT AND SINCE STEEL COST COMPRISES MORE THAN 50 PERCENT OF TOTAL COST OF STEEL AND DOMESTIC CHROME PLATE 12 PERCENT DIFFERENTIAL MUST BE ADDED TO PRICE SUBMITTED.

B-169279, JUN. 1, 1970

BIDDERS--QUALIFICATIONS--SMALL BUSINESS CONCERNS--STATUS EVIDENCE UNDER SET-ASIDE FOR SMALL BUSINESS CONCERN WHERE INVITATION REQUIRED THAT BIDDER'S INDICATE WHETHER OR NOT THEY WERE SMALL BUSINESS CONCERN AND IF NOT MANUFACTURER OF SUPPLIES OFFERED WHETHER SUPPLIES WOULD BE MANUFACTURED BY SMALL BUSINESS CONCERNS IN UNITED STATES, LOW BIDDER WHO FAILED TO MAKE ENTRY IN BUY AMERICAN CERTIFICATE BUT LISTED ITSELF AS MANUFACTURER IS ENTITLED TO AWARD SINCE PREAWARD SURVEY REVEALED BIDDER WAS NOT MANUFACTURER BUT ITEMS OFFERED WERE MANUFACTURED BY SMALL BUSINESS CONCERN AND SINCE BIDDER'S MISSTATEMENT WAS MINOR INFORMALITY CORRECTION COULD BE MADE PRIOR TO AWARD. SEE COMP. GEN. DECS. CITED. BIDS--BUY AMERICAN ACT--FOREIGN PRODUCT DETERMINATION- COMPARISON OF FOREIGN AND DOMESTIC COMPONENT COSTS UNDER 50 PERCENT COMPONENT COST RULE SET FORTH IN E.O. NO. 10582 IN DETERMINING WHETHER WRENCH BLANKS PURCHASED IN JAPAN FOR FURTHER PROCESSING IN UNITED STATES CONSTITUTE FOREIGN OR DOMESTIC SOURCE END PRODUCT, GAO HAS HELD THAT ONLY COSTS OF COMPONENTS, NOT PROCESSING EXPENSES INCURRED WITHIN UNITED STATES, ARE CONSIDERED IN EVALUATING BIDS UNDER BUY AMERICAN ACT AND SINCE STEEL COST COMPRISES MORE THAN 50 PERCENT OF TOTAL COST OF STEEL AND DOMESTIC CHROME PLATE 12 PERCENT DIFFERENTIAL MUST BE ADDED TO PRICE SUBMITTED. SEE COMP. GEN. DECS. CITED.

TO EMPORIUM SPECIALITIES CO; INC.:

WE REFER TO YOUR PROTEST BY LETTER DATED MARCH 2, 1970, ADDRESSED TO THE FEDERAL SUPPLY SERVICE (FSS), GENERAL SERVICES ADMINISTRATION (GSA), AGAINST AWARD OF REQUIREMENTS CONTRACTS TO R & O INDUSTRIES, INC. (R&O) AND AMERICAN KAL ENTERPRISES INC. (AMERICAN), BOTH CALIFORNIA CONCERNS, FOR CERTAIN ITEMS OF IGNITION AND ANGLE WRENCHES ADVERTISED IN INVITATION FOR BIDS (IFB) FPNTN-F1-70815-A-2-26-70, STANDARD FORM 33, ISSUED BY FSS ON JANUARY 30, 1970. THE ITEMS IN QUESTION, NOS. 2 THROUGH 21, AND 23 AND 24, ARE SET ASIDE FOR AWARD TO SMALL BUSINESS CONCERNS, AND THE CONTRACTS TO BE AWARDED WILL RUN FROM JULY 1, 1970, OR DATE OF AWARD IF LATER, THROUGH JUNE 30, 1971.

THE SUBSTANCE OF YOUR PROTEST IS THAT NEITHER OF THE ABOVE BIDDERS QUALIFIES AS A SMALL BUSINESS CONCERN UNDER THE PROVISIONS OF THE IFB. THIS CONNECTION, YOU REFER TO SECTION 48(B) OF GSA FORM 1424, WHICH IS INCLUDED IN THE IFB, AND STATE THAT IT REQUIRES THE PRODUCTS TO BE MANUFACTURED OR PRODUCED IN THE UNITED STATES AND ITS POSSESSIONS. YOU FURTHER STATE THAT BOTH R&O AND AMERICAN BUY THEIR WRENCHES FROM JAPAN "FULLY MANUFACTURED" AND THAT THE MARKING, HEAT TREATING AND PLATING OF THE WRENCHES, WHICH ARE EFFECTED AFTER RECEIPT OF THE ITEMS IN THE UNITED STATES, ARE MINOR OPERATIONS WHICH DO NOT CONSTITUTE 50 PERCENT OF THE COST OF THE WRENCHES WITHIN THE MEANING OF SECTION 14(III) OF STANDARD FORM 32, GENERAL PROVISIONS (SUPPLY CONTRACT), INCORPORATED BY REFERENCE IN THE IFB.

ARTICLE 48, GSA FORM 1424, WHICH IS MADE APPLICABLE TO THE ITEMS IN QUESTION BY NOTATIONS ON THE FACE OF THE BID FORM AND ON PAGE 15 OF THE IFB, READS AS FOLLOWS:

"48. NOTICE OF TOTAL SMALL BUSINESS SET-ASIDE

(APPLICABLE IF PROCUREMENT IS TOTALLY SET-ASIDE FOR SMALL BUSINESS.)

"(A) RESTRICTION. BIDS OR PROPOSALS UNDER THIS PROCUREMENT ARE SOLICITED FROM SMALL BUSINESS CONCERNS ONLY AND THIS PROCUREMENT IS TO BE AWARDED ONLY TO ONE OR MORE SMALL BUSINESS CONCERNS. THIS ACTION IS BASED ON A DETERMINATION BY THE CONTRACTING OFFICER, ALONE OR IN CONJUNCTION WITH A REPRESENTATIVE OF THE SMALL BUSINESS ADMINISTRATION, THAT IT IS IN THE INTEREST OF MAINTAINING OR MOBILIZING THE NATION'S FULL PRODUCTIVE CAPACITY, IN THE INTEREST OF WAR OR NATIONAL DEFENSE PROGRAMS, OR IN THE INTEREST OF ASSURING THAT A FAIR PROPORTION OF GOVERNMENT PROCUREMENT IS PLACED WITH SMALL BUSINESS CONCERNS. BIDS OR PROPOSALS RECEIVED FROM FIRMS WHICH ARE NOT SMALL BUSINESS CONCERNS SHALL BE CONSIDERED NONRESPONSIVE.

"(B) DEFINITION.--A 'SMALL BUSINESS CONCERN' IS A CONCERN, INCLUDING ITS AFFILIATES, WHICH IS INDEPENDENTLY OWNED AND OPERATED, IS NOT DOMINANT IN THE FIELD OF OPERATION IN WHICH IT IS BIDDING ON GOVERNMENT CONTRACTS, AND CAN FURTHER QUALIFY UNDER THE CRITERIA SET FORTH IN REGULATIONS OF THE SMALL BUSINESS ADMINISTRATION (13 CFR 121.3-8). IN ADDITION TO MEETING THESE CRITERIA, A MANUFACTURER OR A REGULAR DEALER SUBMITTING BIDS OR PROPOSALS IN HIS OWN NAME MUST AGREE TO FURNISH IN THE PERFORMANCE OF THE CONTRACT END ITEMS MANUFACTURED OR PRODUCED IN THE UNITED STATES, ITS POSSESSIONS, OR PUERTO RICO, BY SMALL BUSINESS CONCERNS: PROVIDED, THAT THIS ADDITIONAL REQUIREMENT DOES NOT APPLY IN CONNECTION WITH CONSTRUCTION OR SERVICE CONTRACTS."

(THE ABOVE PROVISIONS ARE PRESCRIBED BY FEDERAL PROCUREMENT REGULATIONS (FPR) 1-1.706-5(C) FOR USE IN PROCUREMENTS INVOLVING TOTAL SET-ASIDES FOR SMALL BUSINESS.)

ARTICLE 14 OF STANDARD FORM 33A, "SOLICITATION INSTRUCTIONS AND CONDITIONS," INCLUDED THE FOLLOWING LANGUAGE:

"14. SMALL BUSINESS CONCERN. A SMALL BUSINESS CONCERN FOR THE PURPOSE OF GOVERNMENT PROCUREMENT IS A CONCERN, INCLUDING ITS AFFILIATES, WHICH IS INDEPENDENTLY OWNED AND OPERATED, IS NOT DOMINANT IN THE FIELD OF OPERATION IN WHICH IT IS SUBMITTING OFFERS ON GOVERNMENT CONTRACTS, AND CAN FURTHER QUALIFY UNDER THE CRITERIA CONCERNING NUMBER OF EMPLOYEES, AVERAGE ANNUAL RECEIPTS, OR OTHER CRITERIA, AS PRESCRIBED BY THE SMALL BUSINESS ADMINISTRATION. (SEE CODE OF FEDERAL REGULATIONS, TITLE 13, PART 121, AS AMENDED, WHICH CONTAINS DETAILED INDUSTRY DEFINITIONS AND RELATED PROCEDURES.)"

ARTICLE 14 OF STANDARD FORM 32 READS, IN PERTINENT PART, AS FOLLOWS:

"14. BUY AMERICAN ACT

"(A) IN ACQUIRING END PRODUCTS, THE BUY AMERICAN ACT (41 U.S.C. 10 A D) PROVIDES THAT THE GOVERNMENT GIVE PREFERENCE TO DOMESTIC SOURCE END PRODUCTS. FOR THE PURPOSE OF THIS CLAUSE:

"(I) 'COMPONENTS' MEANS THOSE ARTICLES, MATERIALS, AND SUPPLIES, WHICH ARE DIRECTLY INCORPORATED IN THE END PRODUCTS;

"(II) 'END PRODUCTS' MEANS THOSE ARTICLES, MATERIALS, AND SUPPLIES, WHICH ARE TO BE ACQUIRED UNDER THIS CONTRACT FOR PUBLIC USE; AND

"(III) A 'DOMESTIC SOURCE END PRODUCT' MEANS (A) AN UNMANUFACTURED END PRODUCT WHICH HAS BEEN MINED OR PRODUCED IN THE UNITED STATES AND (B) AN END PRODUCT MANUFACTURED IN THE UNITED STATES IF THE COST OF THE COMPONENTS THEREOF WHICH ARE MINED, PRODUCED, OR MANUFACTURED IN THE UNITED STATES EXCEEDS 50 PERCENT OF THE COST OF ALL ITS COMPONENTS. FOR THE PURPOSES OF THIS (A)(III)(B), COMPONENTS OF FOREIGN ORIGIN OF THE SAME TYPE OR KIND AS THE PRODUCTS REFERRED TO IN (B) (II) OR (III) OF THIS CLAUSE SHALL BE TREATED AS COMPONENTS MINED, PRODUCED, OR MANUFACTURED IN THE UNITED STATES."

PAGE 2 OF THE IFB, ENTITLED "REPRESENTATIONS, CERTIFICATIONS, AND ACKNOWLEDGMENTS," INCLUDES THE FOLLOWING PERTINENT LANGUAGE:

"THE OFFEROR REPRESENTS AND CERTIFIES AS PART OF HIS OFFER THAT: (CHECK OR COMPLETE ALL APPLICABLE BOXES OF BLOCKS.)

"1. SMALL BUSINESS (SEE PAR. 14 ON SF 33A)

HE -- IS, -- IS NOT, A SMALL BUSINESS CONCERN. IF OFFEROR IS A SMALL BUSINESS CONCERN AND IS NOT THE MANUFACTURER OF THE SUPPLIES OFFERED, HE ALSO REPRESENTS THAT ALL SUPPLIES TO BE FURNISHED HEREUNDER -- WILL, -- WILL NOT, BE MANUFACTURED OR PRODUCED BY A SMALL BUSINESS CONCERN IN THE UNITED STATES, ITS POSSESSIONS, OR PUERTO RICO.

"2. REGULAR DEALER-MANUFACTURER (APPLICABLE ONLY TO SUPPLY CONTRACTS EXCEEDING $10,000).

HE IS A -- REGULAR DEALER IN, -- MANUFACTURER OF, THE SUPPLIES OFFERED.

"7. BUY AMERICAN CERTIFICATE

THE OFFEROR HEREBY CERTIFIES THAT EACH END PRODUCT, EXCEPT THE END PRODUCTS LISTED BELOW, IS A DOMESTIC SOURCE END PRODUCT (AS DEFINED IN THE CLAUSE ENTITLED 'BUY AMERICAN ACT'); AND THAT COMPONENTS OF UNKNOWN ORIGIN HAVE BEEN CONSIDERED TO HAVE BEEN MINED, PRODUCED, OR MANUFACTURED OUTSIDE THE UNITED STATES.

EXCLUDED END PRODUCTS COUNTRY OF ORIGIN"

IT IS TO BE NOTED THAT THE REQUIREMENT OF THE SMALL BUSINESS DEFINITION THAT END ITEMS TO BE FURNISHED SHALL BE MANUFACTURED OR PRODUCED IN THE UNITED STATES IS SEPARATE AND DISTINCT FROM THE BUY AMERICAN ACT REQUIREMENTS THAT PREFERENCE BE GIVEN TO DOMESTIC SOURCE END PRODUCTS.

BIDS WERE OPENED ON FEBRUARY 26, 1970, AS SCHEDULED. ON THE ITEMS WITH WHICH YOUR PROTEST IS CONCERNED, AMERICAN WAS LOWEST AS TO ITEMS 2 THROUGH 17; SECOND LOW AS TO ITEMS 18, 19 AND 24; AND DID NOT BID ON ITEMS 20, 21, AND 23. R & O, WHO BID ON ALL ITEMS EXCEPT 23, WAS SECOND LOW AS TO ITEMS 2 THROUGH 17 AND LOWEST AS TO ITEMS 18 THROUGH 21 AND 24. YOU WERE THIRD LOW AS TO ITEMS 2 THROUGH 19 AND 24; SECOND LOW AS TO ITEMS 20 AND 21; AND DID NOT BID ON ITEMS 22 AND 23.

ON PAGE 2 OF THE BID FORM, AMERICAN AND R & O CHECKED BLOCKS UNDER ITEM 1 TO INDICATE THAT EACH IS A SMALL BUSINESS CONCERN, BUT NOT THE MANUFACTURER OF THE SUPPLIES OFFERED, AND THAT THE SUPPLIES OFFERED WILL BE MANUFACTURED OR PRODUCED BY A SMALL BUSINESS CONCERN IN THE UNITED STATES, ITS POSSESSIONS, OR PUERTO RICO. UNDER ITEM 2, EACH BIDDER INDICATED THAT IT IS A MANUFACTURER OF THE SUPPLIES OFFERED. AMERICAN MADE NO ENTRY IN THE BUY AMERICAN CERTIFICATE, BUT R & O ENTERED THE WORD "NONE" IN THE SPACE PROVIDED FOR THE LISTING OF EXCLUDED END PRODUCTS.

ON PAGE 13 OF THE RESPECTIVE BIDS, EACH BIDDER LISTED ITSELF AS THE MANUFACTURER OR SUPPLIER OF THE ITEMS OFFERED AND ENTERED ITS PLANT ADDRESS IN CALIFORNIA AS THE PLACE OF PRODUCTION. IN ADDITION, R & O LISTED YOUR NAME AS AN ALTERNATE PRODUCTION SOURCE AND AUSTIN, PENNSYLVANIA, AS YOUR PLANT ADDRESS.

GSA CONDUCTED AN INVESTIGATION OF YOUR CHARGES CONCERNING THE SOURCE OF THE END PRODUCTS OFFERED BY R & O AND AMERICAN AND ALSO SOLICITED INFORMATION DIRECTLY FROM THE BIDDERS. THE INFORMATION THUS RECEIVED, AS WELL AS DATA OBTAINED DURING PREAWARD SURVEYS BY THE GOVERNMENT OF THE BIDDERS' FACILITIES, REVEALED THAT NEITHER BIDDER IS A MANUFACTURER OF THE ITEMS OFFERED IN THE BIDS; RATHER, BOTH BIDDERS PROPOSE TO HAVE THE ITEMS MADE BY SMALL BUSINESS SUPPLIERS IN THE UNITED STATES.

AT THIS POINT, IT MAY BE STATED THAT ABSENT ANY EVIDENCE OF BAD FAITH ON THE PART OF THE BIDDERS IN SPECIFYING IN THEIR BIDS THAT THEY ARE MANUFACTURERS OF THE ITEMS BID UPON, AND SINCE FPR 1-12.603 PERMITS SUBMISSION OF INFORMATION AS TO REGULAR DEALER OR MANUFACTURER STATUS UP TO THE TIME OF AWARD, IT IS OUR VIEW THAT THE MISSTATEMENTS BY THE BIDDERS MAY PROPERLY BE REGARDED AS MINOR INFORMALITIES IN THE BIDS WHICH MAY BE CORRECTED PURSUANT TO FPR 1-2.405. SEE B-165186, NOVEMBER 7, 1968, RELATING TO ARMED SERVICES PROCUREMENT REGULATION 12-603, THE PROVISIONS OF WHICH ARE SIMILAR TO THE PROVISIONS OF FPR 1-12.603.

AS TO THE ORIGIN OF THE R & O END ITEMS, R & O HAS ADVISED GSA THAT THE STEEL IS TO BE PURCHASED FROM UNITED STATES STEEL CORPORATION, ROLLED AT INTERLAKE MILL, RIVERDALE, ILLINOIS, AND MANUFACTURED INTO WRENCHES BY A CALIFORNIA SUPPLIER. THE PREAWARD SURVEY VERIFIED R & O'S COMMITMENT WITH ITS SUPPLIER. ACCORDINGLY, GSA HAS CONCLUDED THAT R & O OFFERS DOMESTIC END PRODUCTS AND ITS BID IS THEREFORE FOR EVALUATION AS A DOMESTIC BID. ABSENT ANY EVIDENCE TO OVERCOME THE PRESUMPTION OF THE CORRECTNESS OF THE FACTS AS REPORTED BY GSA, WE CONCUR WITH GSA'S POSITION AS TO R & O'S BID.

WITH REGARD TO THE AMERICAN END ITEMS, THE PREAWARD SURVEY SHOWED THAT AMERICAN IMPORTS WRENCH BLANKS FROM JAPAN; THAT VARIOUS SMALL BUSINESS CONCERNS IN THE UNITED STATES ARE SCHEDULED TO FINISH THE WRENCHES BY PERFORMING BROACHING, STAMPING, FORMING, HEAT TREATING, DEBURRING AND POLISHING, AND CHROME PLATING OPERATIONS; AND THAT THE TOTAL COST OF SUCH PROCESSES, TOGETHER WITH THE COST OF THE DOMESTIC SOURCE CHROME PLATE, WILL AMOUNT TO WELL OVER 50 PERCENT OF THE TOTAL COST OF THE END ITEMS TO AMERICAN. COMPONENT COST INFORMATION FURNISHED BY AMERICAN, AND VERIFIED BY THE PREAWARD SURVEY TEAM, SHOWS THAT THE COST OF THE FOREIGN STEEL, THE ONLY FOREIGN COMPONENT OF THE END ITEMS, WILL RANGE FROM $43 TO $63 PER ONE THOUSAND AS OPPOSED TO A COST OF $27 PER ONE THOUSAND FOR THE CHROME PLATING, THE ONLY OTHER COMPONENT.

IN LIGHT OF THE INFORMATION OBTAINED ON AMERICAN'S END ITEMS, GSA DETERMINED THAT UNDER THE 50 PERCENT OF TOTAL COMPONENTS COST RULE SET FORTH IN EXECUTIVE ORDER 10582 OF DECEMBER 17, 1954, AS IMPLEMENTED BY THE BUY AMERICAN ACT CLAUSE PRESCRIBED BY FPR 1-6.104-5 AND INCLUDED IN THE IFB, WHICH TAKES INTO ACCOUNT ONLY THE COSTS OF THE COMPONENTS, NOT THE PROCESSING EXPENSES INCURRED WITHIN THE UNITED STATES (46 COMP. GEN. 784 (1967); 48 ID. 727 (1969)), AMERICAN'S BID OFFERED ARTICLES WHICH MUST BE CONSIDERED AS FOREIGN, SINCE THE COST OF THE FOREIGN STEEL COMPRISES MORE THAN 50 PERCENT OF THE TOTAL COST OF THE STEEL AND THE DOMESTIC CHROME PLATE. REEVALUATION OF THE BID FOR BUY AMERICAN ACT PURPOSES WAS THEREFORE EFFECTED BY ADDING TO AMERICAN'S PRICES THE 12-PERCENT DIFFERENTIAL PRESCRIBED FOR SMALL BUSINESS BIDDERS BY EXECUTIVE ORDER NO. 10582. ON THIS BASIS, THERE WAS NO CHANGE IN AMERICAN'S STATUS AS THE LOWEST BIDDER ON ITEMS 2 THROUGH 17 SINCE ITS PRICES ON THOSE ITEMS, PLUS 12 PERCENT, ARE STILL LOWER THAN ANY OTHERS OFFERED, AND UNDER THE TERMS OF THE EXECUTIVE ORDER THE PRICES OF THE DOMESTIC ARTICLES ARE THEREFORE TO BE CONSIDERED UNREASONABLE. ON ITEMS 18 AND 19 YOU DISPLACED AMERICAN AS SECOND LOW BIDDER.

WITH RESPECT TO AMERICAN'S FAILURE TO COMPLETE THE BUY AMERICAN CERTIFICATE IN ITS BID, GSA TOOK NOTE OF THE FACT THAT AMERICAN WAS APPARENTLY UNDER THE MISTAKEN IMPRESSION THAT ITS END PRODUCTS WOULD BE DOMESTIC SOURCE ITEMS IN VIEW OF THE FACT THAT THE COSTS WHICH AMERICAN ANTICIPATES WILL BE INCURRED IN THE UNITED STATES WILL EXCEED THE SINGLE EXPENDITURE FOR THE STEEL IMPORTED FROM JAPAN. GSA CONCLUDED, HOWEVER, THAT AMERICAN'S MISTAKE IN THIS REGARD DID NOT RENDER ITS BID NONRESPONSIVE. IN SOMEWHAT SIMILAR CIRCUMSTANCES, WE HAVE HELD THAT FAILURE OF A FOREIGN BIDDER TO LIST FOREIGN END ITEMS IN THE BUY AMERICAN CERTIFICATE UNDER AN INVITATION WHICH PERMITTED FURNISHING OF EITHER DOMESTIC OR FOREIGN PRODUCTS DID NOT RENDER THE BID NONRESPONSIVE BUT CONCERNED ONLY THE EVALUATION OF THE BID; ACCORDINGLY, WE STATED THAT THE BID, WHICH WAS LOWEST AFTER PROPER EVALUATION AS A FOREIGN BID, COULD BE CONSIDERED FOR AWARD. 48 COMP. GEN. 942 (1968). WE BELIEVE THE SAME REASONING APPLIES IN THE CIRCUMSTANCES OF THIS CASE, AND WE THEREFORE CONCUR WITH GSA'S POSITION THAT ON ITEMS 2 THROUGH 17, ON WHICH AMERICAN REMAINS LOWEST EVEN AFTER CONSIDERATION OF THE 12-PERCENT FOREIGN BID DIFFERENTIAL, THE BUY AMERICAN ACT CERTIFICATE DEFICIENCY DOES NOT PRECLUDE CONSIDERATION OF THE BID ON SUCH ITEMS. TURNING NOW TO WHETHER THE END ITEMS OFFERED BY AMERICAN ARE MANUFACTURED OR PRODUCED IN THE UNITED STATES FOR THE PURPOSE OF THE SMALL BUSINESS PROVISIONS IN THE IFB, WE HAVE HELD THAT PACKAGING, OR PACKING, AND TESTING AND EVALUATION OF PREVIOUSLY MANUFACTURED END ITEMS TO BE ACQUIRED BY THE GOVERNMENT MAY NOT BE REGARDED AS "MANUFACTURING" PROCESSES WITHIN THE CONTEMPLATION OF THE BUY AMERICAN ACT. HOWEVER, WE HAVE RECOGNIZED THAT PLATING AND MACHINING OPERATIONS REQUIRED ALONG WITH CERTAIN OTHER OPERATIONS TO CONVERT AN UNFINISHED IMPORTED STEEL PRODUCT INTO THE FINISHED ITEM REQUIRED BY THE GOVERNMENT MAY REASONABLY BE REGARDED AS ADEQUATE TO ESTABLISH THAT THE END PRODUCT IS MANUFACTURED IN THE UNITED STATES. 48 COMP. GEN. 727 (1969). IN THE CIRCUMSTANCES, IT IS OUR VIEW THAT THE EVIDENCE THAT THERE WILL BE PERFORMANCE BY SMALL BUSINESS CONCERNS IN THE UNITED STATES OF THE MACHINING AND PLATING OPERATIONS LISTED BY AMERICAN ON THE WRENCHES WHICH AMERICAN PROPOSES TO FURNISH UNDER ITS BID SUBSTANTIATES THE POSITION OF GSA THAT THE AMERICAN WRENCHES QUALIFY AS ITEMS MANUFACTURED IN THE UNITED STATES BY A SMALL BUSINESS AS CONTEMPLATED BY FPR 1-1.701-1(D). SEE, ALSO, B-166727, JULY 15, 1969, 49 COMP. GEN. .

IN LINE WITH THE FOREGOING, IT IS OUR VIEW THAT AWARD TO EITHER R & O OR AMERICAN ON THE VARIOUS ITEMS ON WHICH THEIR BIDS, AS PROPERLY EVALUATED, ARE LOWEST, MAY BE MADE PROVIDED THE BIDS ARE OTHERWISE RESPONSIVE AND THE BIDDERS ARE DETERMINED TO BE RESPONSIBLE AS REQUIRED BY FPR 1-1.310-6.