B-172591, OCT 12, 1971

B-172591, OCT 12, 1971

BID PROTEST - IMPORT ITEMS - PRESIDENTIAL PROCLAMATION AFFIRMING PRIOR DECISION WHICH DENIED PROTEST AGAINST A DETERMINATION BY THE ARMY THAT A BID SUBMITTED BY DOMINION CHAIN CO., LTD., A CANADIAN FIRM, WAS THE LOWEST EVALUATED BID UNDER AN IFB ISSUED BY THE ARMY TANK AUTOMOTIVE COMMAND. PURSUANT TO DPC NO. 91, SUPPLEMENT NO. 2, DATED AUGUST 30, 1971, CANADIAN END PRODUCTS ARE TO BE HANDLED EXACTLY AS PRESCRIBED IN ASPR 6 103.5 AND 6 -104.4, WHICH EXEMPTS CANADIAN END PRODUCTS FROM THE RESTRICTIONS OF THE BUY AMERICAN ACT. THUS, NO IMPORT DUTY, INCLUDING THE 10 PERCENT LEVY IMPOSED BY PRESIDENTIAL PROCLAMATION 4074 OF AUGUST 15, 1971, APPLIES AND THE ARMY PROPERLY REFRAINED FROM CONSIDERING SUCH DUTY IN THE EVALUATION OF DOMINION'S BID.

TO CAMPBELL CHAIN, DIVISION OF UNITEC INDUSTRIES:

WE REFER TO YOUR LETTER OF AUGUST 20, 1971, REQUESTING THAT WE RECONSIDER OUR DECISION B-172591, AUGUST 17, 1971, WHICH SUSTAINED A DETERMINATION BY THE DEPARTMENT OF THE ARMY THAT A BID SUBMITTED BY DOMINION CHAIN CO., LTD., A CANADIAN FIRM, WAS THE LOWEST EVALUATED BID UNDER INVITATION FOR BIDS (IFB) DAAE07-71-B-1432, ISSUED BY THE UNITED STATES ARMY TANK AUTOMOTIVE COMMAND.

YOU STATE THAT WITH IMPOSITION OF THE 10 PERCENT "LEVY" IMPOSED ON ALL IMPORTED ITEMS PURSUANT TO PRESIDENTIAL PROCLAMATION 4074 OF AUGUST 15, 1971, THE DOMINION CHAIN BID WOULD BE SOME $32,000 HIGHER THAN YOUR BID AND YOU SHOULD THEREFORE RECEIVE THE AWARD UNDER THE IFB.

REFERENCE TO PROCLAMATION 4074 SHOWS THAT THE 10 PERCENT LEVY IMPOSED THEREBY IS AN ADDITIONAL CUSTOMS DUTY APPLICABLE ONLY TO DUTIABLE ARTICLES IMPORTED INTO THE CUSTOMS TERRITORY OF THE UNITED STATES. IN THIS CONNECTION, THE DEPARTMENT OF DEFENSE HAS ISSUED GUIDELINES FOR THE MILITARY PROCUREMENT ACTIVITIES IN DEFENSE PROCUREMENT CIRCULAR NO. 91, SUPPLEMENT NO. 2, DATED AUGUST 30, 1971, TO THE EFFECT THAT ALL PROVISIONS OF SECTION VI OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) WILL CONTINUE TO APPLY TO PURCHASES OF FOREIGN-MADE ITEMS; I.E., WHERE DUTY IS A BID EVALUATION FACTOR, THE ADDITIONAL DUTY WILL BE CONSIDERED, BUT CANADIAN END PRODUCTS SHALL CONTINUE TO BE HANDLED EXACTLY AS PRESCRIBED IN ASPR 6-103.5 AND 6-104.4, AND PAYMENT OF DUTY BY CONTRACTORS, INCLUDING THE ADDITIONAL 10 PERCENT IMPOSED BY PROCLAMATION 4074 SHALL CONTINUE TO BE WAIVED AS PROVIDED IN ASPR SECTION VI, PART 6.

INASMUCH AS CANADIAN END PRODUCTS OFFERED UNDER IFB DAAE07-71-B-1432 WERE EXEMPTED FROM THE RESTRICTIONS OF THE BUY AMERICAN ACT PURSUANT TO THE PROVISIONS OF ASPR 6-103.5(A), NO IMPORT DUTY, INCLUDING THE ADDITIONAL DUTY IMPOSED BY PROCLAMATION 4074, APPLIES. IT FOLLOWS THAT NO IMPORT DUTY IS REQUIRED TO BE CONSIDERED IN THE EVALUATION OF BIDS OFFERING CANADIAN END PRODUCTS. ACCORDINGLY, REEVALUATION OF THE DOMINION CHAIN BID IS NOT IN ORDER, AND OUR DECISION OF AUGUST 17, 1971, IS AFFIRMED.