[Code of Federal Regulations]
[Title 22, Volume 1]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 22CFR228.11]

[Page 1039]
 
                       TITLE 22--FOREIGN RELATIONS
 
            CHAPTER II--AGENCY FOR INTERNATIONAL DEVELOPMENT
 
PART 228_RULES ON SOURCE, ORIGIN AND NATIONALITY FOR COMMODITIES 
AND SERVICES FINANCED BY USAID--Table of Contents
 
   Subpart B_Conditions Governing Source and Nationality of Commodity 
              Procurement Transactions for USAID Financing
 
Sec. 228.11  Source and origin of commodities.

    (a) The source and origin of a commodity as defined in Sec. 228.01 
shall be a country or countries authorized in the implementing document 
by name or by reference to a USAID geographic code.
    (b) Any component from a foreign policy restricted country makes the 
commodity ineligible for USAID financing.
    (c) When the commodity being purchased is a kit (e.g., scientific 
instruments, tools, or medical supplies packaged as a single unit), the 
kit will be considered a produced commodity.
    (d) When spare parts for vehicles or equipment are purchased, each 
separate shipment will be considered a produced commodity, rather than 
each individual spare or replacement part. The parts must be packed in 
and shipped from an eligible country.
    (e) Systems determination. When a system consisting of more than one 
produced commodity is procured as a single separately priced item, USAID 
may determine that the system itself shall be considered a produced 
commodity. When a determination is made to treat a system as a produced 
commodity, component commodities which originate from other than an 
authorized source country may be shipped directly to, and the system 
assembled in, the cooperating country, unless USAID specifically 
determines that assembly and shipment take place in an authorized source 
country. Transportation costs must still meet the requirements in 
subpart C of this part in order for them to be eligible for USAID 
financing. USAID, or the importer in the case of a Commodity Import 
Program, shall inform the supplier of any system determination.
    (f) In order to be eligible for USAID financing, when items are 
considered produced commodities under paragraphs (c), (d), or (e) of 
this section, the total cost (to the system supplier) of the commodities 
making up the kit, spare parts, or system which were manufactured in 
countries not included in the authorized geographic code may not exceed 
50 percent of the lowest price (not including ocean transportation and 
marine insurance) at which the supplier makes the final product 
available for export sale.

[61 FR 53616, Oct. 15, 1996; 62 FR 314, Jan. 3, 1997, as amended at 63 
FR 38751, July 20, 1998]