Trade Agreements Act compliance means that, on covered federal contracts above a set dollar threshold, the products you offer must be made or substantially transformed in the United States or a designated country. What is new for 2026 is a routine update to those dollar thresholds, effective March 13, 2026. The core compliance rules are unchanged, and because the thresholds adjust on a regular cycle, the practical step is to verify the current figure for a given contract.
The Trade Agreements Act sets the country-of-origin rules for products offered under certain federal contracts. On a covered contract above a set dollar threshold, the products you provide must be made or substantially transformed in the United States or in a designated country, meaning a country that has a qualifying trade agreement with the United States. What is new for 2026 is a routine update to the dollar thresholds that trigger these rules, effective March 13, 2026. The underlying compliance standard did not change. This article explains the framework and the update factually, so you can see where it applies to your contracts.
The Trade Agreements Act applies to covered federal acquisitions above a specified dollar threshold. Below that threshold, different domestic-preference rules generally apply instead. Above it, the products offered must originate in the United States or a designated country.
A few points define how it works in practice:
These rules are about where a product originates, which is a factual determination tied to the official designated-country list and the substantial transformation standard.
The change for 2026 is an update to the dollar thresholds that determine when the Trade Agreements Act applies. The updated thresholds took effect on March 13, 2026.
These thresholds are adjusted on a regular cycle, generally every two years, based on currency calculations rather than policy choices, which is why the adjustments tend to be modest. Some thresholds shifted slightly in the 2026 update, while others stayed the same. The list of designated countries was not significantly changed; that list is updated periodically and tends to change infrequently.
The practical effect for contractors is limited but worth noting. Because the triggering thresholds were refreshed, the safest approach is to confirm the current threshold for a specific contract rather than rely on a figure from an older reference. The core compliance standard, that covered products be made or substantially transformed in the United States or a designated country, is the same as before.
Because Trade Agreements Act compliance is a product-by-product matter, staying compliant is mostly a documentation and monitoring discipline.
A few practices help:
When an origin determination is genuinely unclear, the country-of-origin question can be complex, and a formal ruling from the relevant authority can provide a definitive answer for a specific product. Across the 500,000 businesses USFCR has guided since 2010, the contractors who avoid compliance problems are generally the ones who built a routine to verify and document product origin before they offer or certify, rather than after a question arises.
What does Trade Agreements Act compliance mean?
It means that, on a covered federal contract above the applicable dollar threshold, the products you offer are made or substantially transformed in the United States or in a designated country. A designated country is one that has a qualifying trade agreement with the United States. Products that do not meet this origin standard are generally not acceptable on a covered contract.
What changed for 2026?
The dollar thresholds that determine when the Trade Agreements Act applies were updated, effective March 13, 2026. These thresholds adjust on a regular cycle, and the 2026 changes were generally modest. The core compliance rules and the way country of origin is determined did not change. Because thresholds are refreshed periodically, verify the current figure for a specific contract.
How is a product's country of origin determined?
By where it was made or substantially transformed. Substantial transformation means processing that creates a new and different article of commerce, with a distinct name, character, or use, rather than simply assembling, repackaging, or relabeling. The determination is made product by product, and for unclear cases a formal ruling from the relevant authority can provide a definitive answer.
Does the Trade Agreements Act apply to my GSA Schedule?
Generally yes. Because a GSA Schedule contract's overall value is well above the threshold, the origin rules typically apply to products on the Schedule regardless of an individual order's size. Schedule holders are generally expected to ensure the products they offer meet the origin standard throughout the contract.
If your business sells products on covered federal contracts, the useful step is to build origin verification into your normal process: know where each product is made or substantially transformed, keep the documentation that supports it, and confirm the current threshold and designated-country list for a given contract rather than relying on older figures. For contractors who want help understanding how these rules apply to their products and their GSA Schedule, USFCR supports businesses with GSA and compliance questions so they can offer their products with confidence.