CHAPTER 13

GOVERNMENT PROCUREMENT

Article 13.1:  Definitions

For the purposes of this Chapter:

build-operate-transfer  contract and public works concession contract means a contractual arrangement the primary purpose of which is to provide for the construction or rehabilitation of physical infrastructure, plants, buildings, facilities or other government-owned works and under which, as consideration for a supplier’s execution of a contractual arrangement, a procuring entity grants to the supplier, for a specified period of time, temporary ownership or a right to control and operate, and demand payment for the use of those works for the duration of the contract;

commercial goods or services means goods or services of a type generally sold  or offered for sale in the commercial marketplace to, and customarily purchased by, non-governmental buyers for non-governmental purposes;

construction service means a service that has as its objective the realization by whatever means of civil or building works, based on Division 51 of the United Nations Provisional Central Product Classification (CPC);

in writing or written means any worded or numbered expression that can be  read, reproduced and may be later communicated. It may include electronically transmitted and stored information;

limited tendering means a procurement method whereby the procuring entity contacts a supplier or suppliers of its choice;

multi-use list means a list of suppliers that a procuring entity has determined satisfy the conditions for participation in that list, and that the procuring entity intends to use more than once;

notice  of  intended  procurement  means  a  notice  published  by  a  procuring  entity  inviting interested suppliers to submit a request for participation, a tender or both;

offset means any condition or undertaking that requires the use of domestic content, a domestic supplier, the licensing of technology, technology transfer, investment, counter-trade or similar action to encourage local development or to improve a Party’s balance of payments accounts;

open tendering means a procurement  method whereby all interested suppliers may  submit  a tender;

procuring entity means an entity listed in Annex 13-A;

publish means to disseminate information through paper or electronic means that is distributed widely and is readily accessible to the general public;

qualified supplier means a supplier that a procuring entity recognizes as having satisfied the conditions for participation;

selective tendering means a procurement method whereby the procuring entity invites only qualified suppliers to submit a tender;

services includes construction services, unless otherwise specified;

supplier means a person or group of persons that provides or could provide a good or service to a procuring entity; and

technical specification means a tendering requirement that: (a)       sets out the characteristics of:

(i)         goods   to  be   procured,   including   quality,   performance,   safety   and dimensions, or the processes and methods for their production; or

(ii)       services to be procured, or the processes or methods for their provision, including any applicable administrative provisions; or

(b)       addresses terminology, symbols, packaging, marking or labelling requirements, as they apply to a good or service.

Article 13.2:  Scope

Application of Chapter

  1. This Chapter applies to any measure regarding covered procurement.
  2. For the purposes of this Chapter, covered procurement means government procurement: (a)  of a good, service or any combination thereof as specified in each Party’s Schedule

to Annex 13-A;

(b)       not procured with a view to commercial sale or resale, or for use in the production or supply of goods or services for commercial sale or resale;

(c)       by any contractual means, including: purchase; rental or lease, with or without an option  to  buy;  build-operate-transfer  contracts  and  public  works  concessions contracts;

(d)       for which the value, as estimated in accordance with paragraphs 8 and 9, equals or exceeds the relevant threshold specified in a Party’s Schedule to Annex 13-A, at the time of publication of a notice of intended procurement;

(e)       by a procuring entity; and

(f)       that is not otherwise excluded from coverage under this Agreement.

2bis.    This Chapter applies only as between Mexico and the United Sates.  Accordingly, for the purposes of this Chapter, “Party” or “Parties” means Mexico or the United States,  singly or collectively.

Activities Not Covered

  1. Unless otherwise provided in a Party’s Schedule to Annex 13-A, this Chapter does not apply to:

(a)       the acquisition or rental of land, existing buildings or other immovable property or the rights thereon;

(b)       non-contractual agreements or any form of assistance that a Party, including its procuring  entities,  provides,  including  cooperative  agreements,  grants,  loans, equity   infusions,   guarantees,   subsidies,   fiscal   incentives   and   sponsorship arrangements;

(c)       the procurement or acquisition of: fiscal agency or depository services; liquidation and management services for regulated financial institutions; or services related to the  sale,  redemption  and  distribution  of  public  debt,   including  loans  and government bonds, notes and other securities;

(e)       public employment contracts; and

(f)       procurement conducted:

(i)         for the specific purpose of providing international  assistance,  including development aid;

(ii)       under the particular procedure or condition of an international agreement relating to the stationing of troops or relating to the  joint  implementation by  the  signatory countries of a project;  or

(iii)      under the particular procedure or condition of an international organization, or funded  by international  grants,  loans  or other  assistance  where  the applicable procedure or condition would be inconsistent with this Chapter.

Schedules

  1. Each Party shall specify the following information in its Schedule to Annex 13-A:

(a)       in Section A, the central government entities whose procurement is covered by this

Chapter;

(b)       in Section B, other entities whose procurement is covered by this Chapter; (c)       in Section C, the goods covered by this Chapter;

(d)       in  Section  D,  the  services,  other  than  construction  services,  covered  by  this

Chapter;

(e)       in Section E, the construction services covered by this Chapter; (f)       in Section F, any General Notes;

(g)       in Section G, the applicable Threshold Adjustment Formula; and

(h)       in Section  H,   the   publication    information    required    under  Article  13.5.2 (Publication of Procurement Information)

Compliance

  1. Each Party shall ensure that its procuring entities comply with this Chapter in conducting covered procurements.
  1. No procuring entity shall prepare or design a procurement, or otherwise structure or divide a procurement into separate procurements in any stage of the procurement, or use a particular method to estimate the value of a procurement, in order to avoid the obligations of this Chapter.
  1. Nothing in this Chapter shall be construed to prevent a Party, including its  procuring entities, from developing new procurement policies, procedures or contractual means, provided that they are not inconsistent with this Chapter.

Valuation

  1. In estimating the value of a procurement for the purposes of ascertaining whether it is a covered procurement, a procuring entity shall include the estimated maximum total value of the procurement over its entire duration, taking into account:

(a)       all forms of remuneration, including any premium, fee, commission, interest or other revenue stream that may be provided for under the contract;

(b)       the value of any option clause; and

(c)       any contract awarded at the same time or over a given period to   one or  more suppliers under the same procurement.

  1. If the total estimated maximum value of a procurement over its entire duration is  not

known, the procurement shall be deemed a covered procurement, unless otherwise excluded under this Agreement.

Article 13.3:  Exceptions

  1. Subject to the requirement that the measure is not applied in a manner that would constitute a means of arbitrary or unjustifiable discrimination between Parties where the same conditions prevail, or a disguised restriction on international trade between the Parties, nothing in this Chapter shall be construed to prevent a Party, including its procuring entities, from adopting or maintaining a measure:

(a)       necessary to protect public morals, order or safety;

(b)       necessary to protect human, animal or plant life or health; (c)       necessary to protect intellectual property; or

(d)       relating to the good or service of a person with disabilities, of philanthropic or not- for-profit institutions, or of prison labor.

  1. The Parties understand that subparagraph 1(b) includes environmental measures necessary to protect human, animal or plant life or health.

Article 13.4:  General Principles

National Treatment and Non-Discrimination

  1. With respect to any measure regarding covered procurement, each Party, including  its procuring entities, shall accord immediately and unconditionally to the goods and services of any other Party and to the suppliers of any other Party, treatment no less favorable than the treatment that the Party, including its procuring entities, accords to:

(a)       domestic goods, services and suppliers; and

(b)       goods, services and suppliers of any other Party.

For greater certainty, this obligation refers only to the treatment accorded by a Party to any good, service or supplier of any other Party under this Agreement.

  1. With respect  to any measure  regarding  covered  procurement,  no Party, including  its procuring entities, shall:

(a)       treat a locally established supplier less favorably than another locally established supplier on the basis of degree of foreign affiliation or ownership; or

(b)       discriminate against a locally established supplier on the basis that the good or service offered by that supplier for a particular procurement is a good or service of any other Party.

  1. All orders under contracts awarded for covered procurement shall be subject to paragraphs

1 and 2 of this Article.

Procurement Methods

  1. A procuring entity shall use an open tendering procedure for covered procurement unless

Article 13.8 (Qualification of Suppliers) or Article 13.9 (Limited Tendering) applies.

Rules of Origin

  1. For purposes of covered procurement, a Party shall not apply rules of origin to goods or services imported from or supplied from another Party that are different from the rules of origin the Party applies at the same time in the normal course of trade to imports or supplies of the same goods or services from the same Party.

Offsets

  1. With regard to covered procurement, no Party, including its procuring entities, shall seek, take account of, impose or enforce any offset, at any stage of a procurement.

Measures Not Specific to Procurement

  1. Paragraphs 1 and 2 shall not apply to customs duties and charges of any kind imposed on or in connection with importation, the method of levying such duties and charges, other import regulations or formalities, and measures affecting trade in services other than measures governing covered procurement.

Use of Electronic Means

  1. The Parties shall seek to provide opportunities for covered procurement to be undertaken through electronic means, including for the publication of procurement information, notices and tender documentation, and for the receipt of tenders.
  1. When conducting covered procurement by electronic means, a procuring entity shall:

(a)       ensure that the procurement is conducted using information technology systems and  software,  including  those  related  to  authentication   and   encryption   of information, that are generally available and interoperable  with other generally available information technology systems and software; and

(b)       establish  and  maintain  mechanisms  that  ensure  the  integrity  of  information provided by suppliers, including requests for participation and tenders.

Article 13.5:  Publication of Procurement Information

  1. Each Party shall promptly publish any measure of general application relating to covered procurement, and any change or addition to this information.
  1. Each Party shall list in Section I of its Schedule to Annex 13-A the paper or electronic means through which the Party publishes the information described in paragraph 1 and the notices required by Article 13.6 (Notices  of Intended  Procurement),  Article 13.8.3  (Qualification  of Suppliers) and Article 13.15.3 (Post-Award Information).
  1. Each Party shall, on request, provide an explanation in response to an inquiry relating to the information referred to in paragraph 1.

Article 13.6:  Notices of Intended Procurement

  1. For each covered procurement, except in the circumstances described in Article 13.9 (Limited Tendering), a procuring entity shall publish a notice of intended procurement through the appropriate paper or electronic means listed in Annex 13-A. The notices  shall remain readily accessible to the public until at  least the expiration of the time period for responding to the notice or the deadline for submission of the tender.
  1. The notices shall, if accessible by electronic means, be provided free of charge:

(a)       for central government entities that are covered under Annex 13-A, through a single point of access; and

(b)       for other entities covered under Annex 13-A, through links in a single electronic portal.

  1. Unless otherwise provided in this Chapter, each notice of intended procurement  shall include the following information, unless that information is provided in the tender documentation that is made available free of charge to all interested suppliers at the same time as the notice of intended procurement:

(a)       the name and address of the procuring entity and other information necessary to contact  the procuring  entity  and obtain  all relevant  documents  relating  to the procurement, and the cost and terms of payment to obtain the relevant documents, if any;

(b)       a description of the procurement, including, if appropriate, the nature and quantity of the goods or services to be procured and a description of any options, or the estimated quantity if the quantity is not known;

(c)       if applicable, the time-frame for delivery of goods or services or the duration of the contract;

(d)       if applicable, the address and any final date for the submission of requests  for participation in the procurement;

(e)       the address and the final date for the submission of tenders;

(f)       the language or languages in which tenders or requests for participation may be submitted, if other than an official language   of the Party of the procuring entity;

(g)       a list and a brief description of any conditions for participation of suppliers, that may include any related requirements for specific documents or certifications that suppliers must provide;

(h)       if, pursuant to Article 13.8 (Qualification of Suppliers), a procuring entity intends to select a limited number of qualified suppliers to be invited to tender, the criteria that will be used to select them and, if applicable, any limitation on the number of suppliers that will be permitted to tender; and

(i)        an indication that the procurement is covered by this Chapter.

  1. For greater certainty, paragraph 3 does not preclude a Party from charging a fee for tender documentation if the notice of intended procurement includes all of the information set out in paragraph 3.

Notice of Planned Procurement

  1. Procuring entities are encouraged to publish as early as possible in each fiscal year a notice regarding their future procurement plans (notice of planned procurement) which should include the subject matter of the procurement and the planned date of publication of the notice of intended procurement.

Article 13.7:  Conditions for Participation

  1. A procuring entity shall limit any conditions for participation in a covered procurement  to those  conditions  that  ensure  that  a  supplier  has  the  legal  and financial capacities and the commercial and technical abilities to fulfil the requirements of that procurement.
  1. In establishing the conditions for participation, a procuring entity:

(a)       shall not impose the condition that, in order for a supplier to participate in a procurement, the supplier has previously been awarded one or more contracts by a procuring entity of a given Party or that the supplier has prior work experience in the territory of that Party; and

(b)       may require relevant prior experience if essential to meet the requirements of the procurement.

  1. In assessing whether a supplier satisfies the conditions for participation, a procuring entity shall:

(a)       evaluate the financial capacity and the commercial and technical abilities of a supplier on the basis of that supplier’s business activities both inside and outside the territory of the Party of the procuring entity; and

(b)       base its evaluation solely on the conditions that the procuring entity has specified in advance in notices or tender documentation.

  1. If there is supporting material, a Party, including its procuring entities, may  exclude  a supplier on grounds such as:

(a)       bankruptcy or insolvency; (b)       false declarations;

(c)       significant or persistent deficiencies in the performance of any substantive requirement or obligation under a prior contract or contracts;

(d)      final judgments in respect of serious crimes or other serious offences;

(e)       professional misconduct or actions or omissions that adversely reflect on the commercial integrity of the supplier; or

(f)       failure to pay taxes.

  1. For greater certainty, this Article is not intended to preclude a procuring  entity  from promoting compliance with laws in the territory in which the good is produced or the service is performed relating to labor rights as recognized by the Parties and set forth in Article 23.3 (Labor Rights),  provided  that  such  measures  are  applied  in  a  manner  consistent  with  Chapter  29 (Publication and Administration), and are not applied in a manner that constitutes a means of arbitrary or unjustifiable discrimination between the Parties or a disguised restriction on trade between the Parties.1

Article 13.8:  Qualification of Suppliers

Registration Systems and Qualification Procedures

  1. A Party, including its procuring entities, may maintain a supplier registration system under which interested suppliers are required to register and provide certain information.
  1. No Party, including its procuring entities, shall:

1 The adoption and maintenance of these measures by a Party should not be construed as evidence that another

Party has breached the obligations under Chapter 23 (Labor) with respect to labor.

(a)       adopt or apply any registration system or qualification procedure with the purpose or the effect of creating unnecessary obstacles to the participation of suppliers of another Party in its procurement; or

(b)       use such registration system or qualification procedure to prevent or delay  the inclusion  of suppliers  of other Parties  on a list of suppliers  or prevent  those suppliers from being considered for a particular procurement.

Selective Tendering

  1. If a procuring entity intends to use selective tendering, the procuring entity shall:

(a)       publish a notice of intended procurement that invites suppliers to submit a request for participation in a covered procurement; and

(b)       include in the notice of intended procurement the information specified in Article

13.6.3(a), (b), (d), (g), (h) and (i) (Notices of Intended Procurement).

  1. The procuring entity shall:

(a)       publish the notice sufficiently in advance of the procurement to allow interested suppliers to request participation in the procurement;

(b)       provide,  by the commencement  of the time  period  for tendering,  at least  the information in Article 13.6.3 (c), (e) and (f) (Notices of Intended Procurement) to the qualified suppliers that it notifies as specified  in  Article  13.13.3(b)  (Time Periods); and

(c)       allow all qualified suppliers to submit a tender, unless the procuring entity stated in the notice of intended procurement a limitation on the number of suppliers that will be permitted to tender and the criteria or justification for selecting the limited number of suppliers.

  1. If the tender documentation is not made publicly available from the date of publication of the  notice  referred  to  in  paragraph  3,  the  procuring  entity  shall  ensure  that  the  tender documentation  is made  available  at the same  time  to all the qualified  suppliers  selected  in accordance with paragraph 4(c).

Multi-Use Lists

  1. A Party, including its procuring entities, may establish or maintain a multi-use list provided that it publishes annually, or otherwise makes continuously available by electronic means, a notice inviting interested suppliers to apply for inclusion on the list.  The notice shall include:

(a)       a description of the goods and services, or categories thereof, for which the list may be used;

(b)       the conditions for participation to be satisfied by suppliers for inclusion on the list and the methods that the procuring entity or other government agency will use to verify a supplier’s satisfaction of those conditions;

(c)       the name and address of the procuring entity or other government agency and other information necessary to contact the procuring entity and to obtain all  relevant documents relating to the list;

(d)       the period of validity of the list and the means for its renewal or termination or, if the period of validity is not provided, an indication of the method by which notice will be given of the termination of use of the list;

(e)       the deadline for submission of applications for inclusion on the list, if applicable;

and

(f)       an indication that the list may be used for procurement covered by this Chapter, unless that indication is publicly available through information published pursuant to Article 13.5.2 (Publication of Procurement Information).

  1. A Party, including its procuring entities, that establishes or maintains a multi-use list, shall include on the list, within a reasonable period of time, all suppliers that satisfy the conditions for participation set out in the notice referred to in paragraph 6.
  1. If a supplier that is not included on a multi-use list submits a request for participation in a procurement based on the multi-use list and submits all required documents, within the time period provided for in Article 13.13.2 (Time Periods), a procuring entity shall examine the request. The procuring entity shall not exclude the supplier from consideration in respect of the procurement unless the procuring entity is not able to complete the examination of the request within the time period allowed for the submission of tenders.

Information on Procuring Entity Decisions

  1. A procuring entity or other entity of a Party shall promptly inform any supplier that submits a request for participation in a procurement or application for inclusion on a multi-use list of the decision with respect to the request or application.
  1. If a procuring entity or other entity of a Party rejects a supplier’s request for participation or application for inclusion on a multi-use list, ceases to recognize a supplier as qualified, or removes a supplier from a multi-use list, the entity shall promptly inform the supplier and on request of the supplier, promptly provide the supplier with a written explanation of the reason for its decision.

Article 13.9:  Limited Tendering

  1. Provided  that it does not use this provision  for the purpose of avoiding  competition

between suppliers, to protect domestic suppliers or in a manner that discriminates against suppliers of any other Party, a procuring entity may use limited tendering.

  1. If a procuring entity uses limited tendering, it may choose, according to the nature of the procurement,  not  to  apply  Article  13.6  (Notices  of  Intended  Procurement),  Article  13.7 (Conditions   for   Participation),   Article   13.8   (Qualification   of   Suppliers),   Article   13.10 (Negotiations), Article 13.11 (Technical Specifications), Article 13.12 (Tender Documentation), Article 13.13 (Time Periods) or Article 13.14 (Treatment of Tenders and Awarding of Contracts). A procuring entity may use limited tendering only under the following circumstances:

(a)       if, in response to a prior notice, invitation to participate or  invitation to tender: (i)  no tenders were submitted or no suppliers requested participation;

(ii)       no tenders were submitted that conform to the essential requirements in the tender documentation;

(iii)      no suppliers satisfied the conditions for participation; or

(iv)      the tenders submitted were collusive,

provided  that the procuring  entity  does not substantially  modify  the  essential requirements set out in the notices or tender documentation;

(b)       if the  good  or service  can  be  supplied  only  by  a particular  supplier  and  no reasonable alternative or substitute good or service exists for any of the following reasons:

(i)        the requirement is for a work of art;

(ii)       the protection of patents, copyrights or other exclusive rights; or

(iii)      due to an absence of competition for technical reasons;

(c)       for additional deliveries by the original supplier or its authorized agents, of goods or services that were not included in the initial procurement if a change of supplier for such additional goods or services:

(i)         cannot   be   made   for   technical   reasons   such   as   requirements   of interchangeability  or interoperability  with existing equipment,  software, services or installations procured under the initial procurement, or due to conditions under original supplier warranties; and

(ii)       would cause significant inconvenience or substantial duplication of costs for the procuring entity;

(d)       for a good purchased on a commodity market or exchange;

(e)       if a procuring entity procures a prototype or a first good or service that is intended for limited trial or that is developed at its request in the course  of,  and for, a particular  contract  for  research,  experiment,  study  or  original  development. Original development of a prototype or a first good or service may include limited production or supply in order to incorporate  the  results of field testing and to demonstrate that the prototype or the first good or service is suitable for production or supply in quantity to acceptable quality standards, but does not include quantity production or supply to establish commercial viability or to recover research and development costs;

(f)       for purchases made under exceptionally advantageous conditions that only arise in the very short term, such as from unusual disposals, liquidation, bankruptcy or receivership, but not for routine purchases from regular suppliers;

(g)       if a contract is awarded to the winner of a design contest, provided that:

(i)        the contest has been organized in a manner that is consistent with  this

Chapter; and

(ii)       the contest is judged by an independent jury with a view to award a design contract to the winner; or

(h)       in so far as is strictly necessary if, for reasons of extreme urgency brought about by events unforeseeable by the procuring entity, the good or service could not be obtained in time by means of open or selective tendering.

  1. For each contract awarded in accordance with paragraph 2, a procuring entity shall prepare a report in writing, or maintain a record, that includes the name of the procuring entity, the value and kind of good or service procured,  and a statement  that indicates  the  circumstances  and conditions described in paragraph 2 that justified the use of limited tendering.

Article 13.10:  Negotiations

  1. A Party may provide for its procuring entities to conduct negotiations in the context of covered procurement if:

(a)       the procuring entity has indicated its intent to conduct negotiations in the notice of intended   procurement   required   under   Article   13.6   (Notices   of   Intended Procurement); or

(b)       it appears from the evaluation that no tender is obviously the most advantageous in terms  of  the  specific  evaluation  criteria  set  out   in  the  notice  of  intended procurement or tender documentation.

  1. A procuring entity shall:

(a)       ensure that any elimination of suppliers participating in negotiations is carried out in  accordance  with  the  evaluation  criteria  set  out  in  the  notice  of  intended procurement or tender documentation; and

(b)       when negotiations are concluded, provide a common deadline for the remaining participating suppliers to submit any new or revised tenders.

Article 13.11:  Technical Specifications

  1. A procuring entity shall not prepare, adopt or apply any technical specification or prescribe any conformity  assessment  procedure  with the purpose  or effect of creating  an  unnecessary obstacle to trade between the Parties.
  1. In prescribing  the technical  specifications  for the good  or service  being  procured,  a procuring entity shall, if appropriate:

(a)       set  out  the  technical  specifications  in  terms  of  performance  and  functional requirements, rather than design or descriptive characteristics; and

(b)       base  the  technical  specifications   on  international  standards,  if  these   exist; otherwise,  on  national  technical  regulations,  recognized  national  standards  or building codes.

  1. A procuring entity shall not prescribe technical specifications that require or refer to a particular trademark or trade name, patent, copyright, design, type, specific origin, producer or supplier,  unless  there  is  no  other  sufficiently  precise  or  intelligible  way  of  describing  the procurement requirements and provided that, in these cases, the procuring entity includes words such as “or equivalent” in the tender documentation.
  1. A procuring entity shall not seek or accept, in a manner that would have the effect of precluding competition, advice that may be used in the preparation or adoption of any technical specification for a specific procurement from a person that may have a commercial interest in the procurement.
  1. For greater  certainty,  a procuring  entity  may conduct  market  research  in  developing specifications for a particular procurement.
  1. For greater certainty,  this Article is not intended  to preclude  a procuring entity from preparing, adopting or applying technical specifications to promote the conservation of natural resources or the protection of the environment.
  1. For greater certainty, this Chapter is not intended to preclude a Party, or its procuring entities, from preparing, adopting or applying technical specifications required to protect sensitive government information, including specifications that may affect or limit the storage, hosting or processing of such information outside the territory of the Party.

Article 13.12:  Tender Documentation

  1. A procuring entity shall promptly make available or provide on request to any interested supplier tender documentation that includes all information necessary to permit the supplier to prepare and submit a responsive  tender.   Unless already  provided  in the  notice of intended procurement, that tender documentation shall include a complete description of:

(a)       the procurement, including the nature, scope and, if known, the quantity of the good or service to be procured or, if the quantity is not known, the estimated quantity and any requirements to be fulfilled, including any technical specifications, conformity certification, plans, drawings or instructional materials;

(b)       any conditions for participation, including any financial guarantees, information and documents that suppliers are required to submit;

(c)       all criteria to be considered in the awarding of the contract and the relative importance of those criteria;

(d)       if there will be a public opening of tenders, the date, time and place for the opening;

(e)       any other terms or conditions relevant to the evaluation of tenders; and

(f)       any date for delivery of a good or supply of a service.

  1. In establishing any date for the delivery of a good or the supply of a service being procured, a procuring entity shall take into account factors such as the complexity of the procurement, the extent of subcontracting anticipated and the realistic time required for production, de-stocking and transport of goods from the point of supply or for supply of services.
  1. A procuring entity shall promptly reply to any reasonable request for relevant information by an interested or participating supplier, provided that the information does not give that supplier an advantage over other suppliers.

Modifications

  1. If, prior to the award of a contract, a procuring entity modifies the evaluation criteria or requirements set out in a notice of intended procurement or tender documentation provided to a participating supplier, or amends or re-issues a notice or tender documentation, it shall publish or provide those modifications, or the amended or re-issued notice or tender documentation:

(a)       to all suppliers that are participating in the procurement at the time of the modification, amendment or re-issuance, if those suppliers are known to the procuring entity, and in all other cases, in the same manner as the original information was made available; and

(b)       in adequate time to allow those suppliers to modify and re-submit their initial tender, if appropriate.

Article 13.13:  Time Periods

General

  1. A procuring entity shall, consistent with its own reasonable needs, provide sufficient time for a supplier  to obtain  the tender  documentation  and  to prepare  and  submit  a  request  for participation and a responsive tender, taking into account factors such as:

(a)       the nature and complexity of the procurement; and

(b)       the time necessary for transmitting tenders by non-electronic means from foreign as well as domestic points if electronic means are not used.

Deadlines

  1. A procuring entity that uses selective tendering shall establish that the final date for the submission of a request for participation shall not, in principle, be less than 25 days from the date of publication of the notice of intended procurement. If a state of urgency duly substantiated by the procuring entity renders this time period impracticable, the time period may be reduced to no less than 10 days.
  1. Except as provided in paragraphs 4 and 5, a procuring entity shall establish that the final date for the submission of tenders shall not be less than 40 days from the date on which:

(a)       in the case of open tendering, the notice of intended procurement is published; or

(b)       in the case of selective tendering, the procuring entity notifies the suppliers that they will be invited to submit tenders, whether or not it uses a multi-use list.

  1. A procuring entity may reduce the time period for tendering set out in paragraph 3 by five days for each one of the following circumstances:

(a)       the notice of intended procurement is published by electronic means;

(b)       the tender documentation is made available by electronic means from the date of the publication of the notice of intended procurement; and

(c)       the procuring entity accepts tenders by electronic means.

  1. A procuring entity may reduce the time period for tendering set out in paragraph 3 to no less than 10 days if:

(a)       the procuring entity has published a notice of planned procurement under Article

13.6 (Notices of Intended Procurement)  at least 40 days and no more than  12 months in advance of the publication of the notice of intended procurement, and the notice of planned procurement contains:

(i)        a description of the procurement;

(ii)       the approximate final dates for the submission of tenders or requests for participation;

(iii)      the address from which documents  relating to the procurement  may  be obtained; and

(iv)       as much of the information  that is required  for the notice of  intended procurement as is available;

(b)       a state of urgency duly substantiated by the procuring entity renders impracticable the time period for tendering set out in paragraph 3; or

(c)       the procuring entity procures commercial goods or services.

  1. The use of paragraph 4, in conjunction with paragraph 5, shall in no case result in the reduction of the time periods for tendering set out in paragraph 3 to less than 10 days.
  1. A procuring entity shall require all interested or participating suppliers to submit requests for participation or tenders in accordance with a common deadline. These time periods, and any extension of these time periods, shall be the same for all interested or participating suppliers.

Article 13.14:  Treatment of Tenders and Awarding of Contracts

Treatment of Tenders

  1. A procuring entity shall receive, open and treat all tenders under procedures that guarantee the fairness and impartiality of the procurement process and the confidentiality of tenders.
  1. If the tender of a supplier is received after the time specified for receiving tenders, the procuring entity shall not penalize that supplier if the delay is due solely to the mishandling on the part of the procuring entity.
  1. If a procuring entity provides a supplier with an opportunity to correct unintentional errors of form between the opening of tenders and the awarding of the contract, the procuring entity shall provide the same opportunity to all participating suppliers.

Awarding of Contracts

  1. To be considered for an award, a tender shall be submitted in writing and shall, at the time

of opening, comply with the essential requirements set out in the notice and tender documentation and be submitted by a supplier who satisfies the conditions for participation.

  1. Unless a procuring entity determines that it is not in the public interest to award a contract, it shall award the contract to the supplier that the procuring entity has determined to be fully capable of fulfilling the terms of the contract and that, based solely  on the evaluation criteria specified in the notice and tender documentation, submits:

(a)       the most advantageous tender; or

(b)       if price is the sole criterion, the lowest price.

  1. If a procuring entity received a tender with a price that is abnormally lower than the prices in other tenders submitted, it may verify with the supplier that it satisfies the  conditions for participation and is capable of fulfilling the terms of the contract.
  1. A procuring entity shall not use options, cancel a covered procurement,  or modify  or terminate awarded contracts in order to avoid the obligations of this Chapter.

Article 13.15: Transparency and Post-Award Information

Information Provided to Suppliers

  1. A procuring entity shall promptly inform suppliers that have submitted a tender of the contract award decision.   The procuring  entity may do so in writing or through the  prompt publication of the notice in paragraph 3, provided that the notice includes the date of award. If a supplier has requested the information in writing, the procuring entity shall provide it in writing.
  1. Subject to Article 13.16 (Disclosure of Information), a procuring entity shall, on request, provide an unsuccessful supplier with an explanation of the reasons why the procuring entity did not select the unsuccessful supplier’s tender or an explanation of the relative advantages of the successful supplier’s tender.

Publication of Award Information

  1. A procuring entity shall, promptly after the award of a contract for a covered procurement, publish  in  an  officially  designated  publication  a  notice  containing  at  least  the  following information:

(a)       a description of the good or service procured; (b)       the name and address of the procuring entity;

(c)       the name and address of the successful supplier; (d)       the value of the contract award;

(e)       the date of award or, if the procuring entity has already informed suppliers of the date of the award under paragraph 1, the contract date; and

(f)       the procurement method used and, if a procedure was used pursuant to Article 13.9 (Limited Tendering), a brief description  of the circumstances justifying the use of that procedure.

Maintenance of Records

  1. A procuring  entity  shall  maintain  the documentation,  records  and reports  relating  to tendering procedures and contract awards for covered procurement, including the records and reports provided for in Article 13.9.3 (Limited Tendering), for at least three years after the award of a contract.

Collection and Reporting of Statistics

  1. Each Party shall  prepare a statistical report on its covered procurement, and make such report publicly available on an official website. Each report shall cover one year and be available within two years of the end of the reporting period, and shall contain:

(a)       for Section A procuring entities:

(i)         the number and total value, for all such entities, of all contracts covered by this Chapter;

(ii)       the number and total value of all contracts covered by this Chapter awarded by each such entity, broken down by categories of goods  and services according to an internationally recognized uniform classification system; and

(iii)      the number and total value of all contracts covered by this Chapter awarded by each such entity under limited tendering;

(b)       for Section B procuring entities, the number and total value of contracts covered by this Chapter awarded by all such entities, and

(c)      estimates for the data required under subparagraphs (a) and (b), with an explanation of the methodology used to develop the estimates, if it is not feasible to provide the data.

Article 13.16:  Disclosure of Information

Provision of Information to Parties

  1. On request of any other Party, a Party shall provide promptly information sufficient to

demonstrate whether a procurement was conducted fairly, impartially and in accordance with this Chapter, including, if applicable, information on the characteristics and relative advantages of the successful  tender,  without  disclosing  confidential  information.    The  Party  that  receives  the information shall not disclose it to any supplier, except after consulting with, and obtaining the agreement of, the Party that provided the information.

Non-Disclosure of Information

  1. Notwithstanding  any other provision  of this Chapter, a Party, including  its  procuring entities, shall not, except to the extent required by law or with the written authorization of the supplier  that provided  the information,  disclose  information  that  would  prejudice  legitimate commercial interests of a particular supplier or that might prejudice fair competition between suppliers.
  1. Nothing in this Chapter shall be construed to require a Party, including its  procuring entities, authorities and review bodies, to disclose confidential information if that disclosure:

(a)       would impede law enforcement;

(b)       might prejudice fair competition between suppliers;

(c)       would prejudice the legitimate commercial interests of particular persons, including the protection of intellectual property; or

(d)       would otherwise be contrary to the public interest.

Article 13.17:  Ensuring Integrity in Procurement Practices

  1. Each Party shall ensure that criminal, civil, or administrative  measures exist that  can address corruption, fraud, and other wrongful acts in its government procurement.
  1. These measures may include procedures to debar, suspend, or declare ineligible  from participation in the Party’s procurements, for a stated period of time, a supplier that the Party has determined to have engaged in corruption, fraud, or other wrongful acts relevant to a supplier’s eligibility to participate in a Party’s government procurement.  Each Party:

(a)       may consider the seriousness of the supplier’s acts or omissions and any remedial measures  or  mitigating  factors  in  making  any  decisions  on   debarment  or suspension, including in making a decision on whether to  reduce the period or extent of debarment or suspension at the supplier’s request pursuant to paragraph

2(b)(ii).

(b)       shall provide a supplier of the other Party directly implicated by a  proceeding applying procedures adopted or maintained under paragraph 2:

  1. reasonable notice that the proceeding was initiated, including a description of the nature of the proceeding, a statement of the authority under which the proceeding was initiated, and the reasons for the proceeding; and
  1. i reasonable opportunity  to present facts and arguments in support of  its position.

(c)       shall publish and update a list of enterprises and, subject to its law, natural persons it has debarred, suspended, or declared ineligible.

  1. Each Party shall ensure that it has in place policies or procedures to address  potential conflicts of interest on the part of those engaged in or having influence over a procurement.
  1. Each Party may also put in place policies or procedures, including provisions in tender documentation,  that  require  successful  suppliers  to  maintain  and  enforce  effective  internal controls, business ethics, and compliance programs, taking into account the size of the supplier, particularly SMEs, and other relevant factors, for preventing and detecting corruption, fraud, and other wrongful acts.

Article 13.18:  Domestic Review

  1. Each Party shall maintain, establish or designate at least one impartial administrative or judicial authority (review authority) that is independent of its procuring entities to review, in a non-discriminatory,   timely,  transparent   and  effective   manner,   a  challenge   or  complaint (complaint) by a supplier that there has been:

(a)       a breach of this Chapter; or

(b)       if the supplier does not have a right to directly challenge a breach of this Chapter under the law of a Party, a failure of a procuring entity to comply with the Party’s measures implementing this Chapter,

arising in the context of a covered procurement, in which the supplier has, or had, an interest. The procedural rules for all complaints shall be in writing and made generally available.

  1. In the event of a complaint by a supplier, arising in the context of covered procurement in which the supplier has, or had, an interest, that there has been a breach or a failure as referred to in paragraph 1, the Party of the procuring entity conducting the procurement shall encourage, if appropriate, the procuring entity and the supplier to seek  resolution of the complaint through consultations.  The  procuring  entity  shall  accord  impartial  and  timely  consideration  to  the complaint in a manner that is not prejudicial to the supplier’s participation in ongoing or future procurement or to its right to seek corrective measures under the administrative or judicial review procedure.  Each Party shall make information on its complaint mechanisms generally available.
  1. If a body other than the review authority initially reviews a complaint, the Party  shall ensure that the supplier may appeal the initial decision to the review authority that is independent

of the procuring entity that is the subject of the complaint.

  1. If the review authority has determined that there has been a breach or a failure as referred to in paragraph 1, a Party may limit compensation for the loss or damages suffered to either the costs reasonably incurred in the preparation of the tender or in bringing the complaint, or both.
  1. Each Party shall ensure that, if the review authority is not a court, its review procedures are conducted in accordance with the following procedures:

(a)       a supplier shall be allowed sufficient time to prepare and submit a complaint in writing, which in no case shall be less than 10 days  from the time when the basis of the complaint became known or reasonably should have become known to the supplier;

(b)       a procuring entity shall respond in writing to a supplier’s complaint and provide all relevant documents to the review authority;

(c)       a supplier that initiates a complaint shall be provided an opportunity to reply to the procuring entity’s response before the review authority takes a decision  on the complaint; and

(d)       the review authority shall provide its decision on a supplier’s complaint in a timely fashion, in writing, with an explanation of the basis for the decision.

  1. Each Party shall adopt or maintain procedures that provide for:

(a)       prompt interim measures, pending the resolution of a complaint, to preserve the supplier’s opportunity  to participate in the procurement  and to ensure  that the procuring  entities  of  the  Party  comply  with  its  measures  implementing  this Chapter; and

(b)       corrective action that may include compensation under paragraph 4.

The procedures may provide that overriding adverse consequences for the interests concerned, including the public interest, may be taken into account when deciding whether those measures should be applied. Just cause for not acting shall be provided in writing.

Article 13.19:  Modifications and Rectifications of Annex

  1. A Party  shall  notify  any  proposed  modification  or rectification  (modification)  to  its Schedule to Annex 13-A by circulating a notice in writing to the other Parties through the overall contact points designated under Article 30.5 (Agreement Coordinator and Contact Points). A Party shall provide compensatory adjustments for a change in coverage if necessary to maintain a level of coverage comparable to the coverage that existed prior to the modification. The Party may include the offer of compensatory adjustment in its notice.
  1. A Party is not required to provide compensatory adjustments to the other Parties if the proposed modification concerns one of the following:

(a)       a procuring entity over which the Party has effectively eliminated its control or influence in respect of covered procurement by that procuring entity; or

(b)       rectifications of a purely formal nature and minor modifications to its Schedule to

Annex 13-A, such as:

(i)        changes in the name of a procuring entity;

(ii)       the merger of one or more procuring entities listed in its Schedule;

(iii)      the separation of a procuring entity listed in its Schedule into two or more procuring entities that are all added to the procuring entities listed in the same Section of the Annex; and

(iv)      changes in website references,

and no Party objects under paragraph 3 on the basis that the proposed modification does  not concern subparagraph (a) or (b).

  1. Any Party whose rights under this Chapter may be affected by a proposed modification that is notified under paragraph 1 shall notify the other Parties of any objection to the proposed modification within 45 days of the date of circulation of the notice.
  1. If  a Party  objects  to  a proposed  modification,  including  a  modification  regarding  a procuring  entity on the basis that government  control or influence over the  entity’s covered procurement  has been effectively  eliminated,  that Party  may request  additional  information, including information  on the nature of any government  control or  influence,  with a view to clarifying and reaching agreement on the proposed modification, including the procuring entity’s continued coverage under this Chapter.  The modifying Party and any objecting Party shall make every attempt to resolve the objection through consultations.
  1. If the modifying Party and any objecting Party resolve the objection through consultations, the modifying Party shall notify the other Parties of the resolution.
  1. The Commission shall modify Annex 13-A to reflect any agreed modification.

Article 13.20:  Facilitation of Participation by SMEs

  1. The Parties recognize the important contribution that SMEs can make to economic growth and employment  and the importance of facilitating the participation  of SMEs in  government procurement.
  1. If a Party maintains a measure that provides preferential treatment for SMEs, the Party

shall ensure that the measure, including the criteria for eligibility, is transparent.

  1. To facilitate participation by SMEs in covered procurement, each Party shall, to the extent possible and if appropriate:

(a)       provide comprehensive procurement-related information that includes a definition of SMEs in a single electronic portal;

(b)       endeavor to make all tender documentation available free of charge;

(c)       conduct procurement by electronic means or through other new information and communication technologies; and

(d)       consider the size, design and structure of the procurement, including the use of subcontracting by SMEs.

Article 13.21: Committee on Government Procurement

  1. The Parties hereby establish  a Committee  on Government  Procurement  (Committee), composed of government representatives of each Party. On request of a Party, the Committee shall meet to address matters related to the implementation and operation of this Chapter, such as:

(a)       facilitation of participation by SMEs in covered procurement, as provided for in

Article 13.20 (Facilitation of Participation by SMEs);

(b)       experiences and best practices in the use and adoption of information technology in conducting covered procurement. This could include topics like the use of digital modeling in construction services; and

(c)       experiences and best practices in the use and adoption of measures to promote opportunities for socially or economically disadvantaged people when conducting covered procurement.

ANNEX 13-A SCHEDULE OF MEXICO

SECTION A: Central Government Entities

Thresholds:

Unless otherwise specified, Chapter 13 (Government Procurement) shall cover procurement by entities listed in this Section, in accordance with the following thresholds:

US$80,317                               Goods and Services

US$10,441,216                        Construction Services

The thresholds set out in this paragraph shall be adjusted in accordance with Section G of this

Schedule.

List of Entities:

  1. Secretaría   de   Agricultura,   Ganadería,   Desarrollo   Rural,   Pesca   y   Alimentación

(Ministry of Agriculture, Livestock, Rural Development, Fisheries and Feeding), includes:

(a) Agencia  de  Servicios  a  la  Comercialización   y  Desarrollo  de  Mercados

Agropecuarios (Support Services for Agricultural Marketing)

(b) Comisión   Nacional   de  Acuacultura   y  Pesca   (National   Commission   of

Aquaculture and Fisheries)

(c) Instituto  Nacional  de  Investigaciones   Forestales,   Agrícolas  y  Pecuarias (National Forestry, Agriculture and Cattle Research Institute) (d) Instituto Nacional de Pesca (National Institute of Fisheries)

(d) Servicio de Información Agroalimentaria y Pesquera (Information Service and

Agro-alimentary and Fisheries Statistics)

(e)  Servicio Nacional de Inspección y Certificación de Semillas (National Service of

Inspection and Certification of Seeds)

(f) Servicio Nacional de Sanidad, Inocuidad y Calidad Agroalimentaria (National

Service of Health, Innocuous and Agro-alimentary Quality)

  1. Secretaría   de   Comunicaciones    y   Transportes    (Ministry   of   Communication  and

Transportation), includes:

(a) Instituto Mexicano del Transporte (Mexican Institute of Transportation)

  1. Secretaría de la Defensa Nacional (Ministry of National Defense)
  1. Secretaría de  Desarrollo  Agrario,  Territorial  y  Urbano  (Ministry of Agrarian

Territorial and Urban Development), includes:

(a) Comisión Nacional de Vivienda (National Housing Commission) (b) Procuraduría Agraria (Agrarian Office of the Attorney)

(c) Registro Agrario Nacional (National Agrarian Registry)

  1. Secretaría de Desarrollo Social (Ministry of Social Development), includes:

(a) Coordinación Nacional de PROSPERA (National Coordination PROSPERA)

  1. Secretaría de Economía (Ministry of Economy), includes:

(a) Comisión Federal de Mejora Regulatoria (Federal Commission of Regulatory

Improvement)

(b)  Instituto Nacional del Emprendedor (National Entreprenuer Institute)

  1. Secretaría de Educación Pública (Ministry of Public Education), includes:

(a) Comisión Nacional  de Cultura Física y Deporte  (National Physical Culture and

Sports Commission)

(b) Consejo Nacional para la Cultura y las Artes (National Council for Culture and

Arts)

(c) Instituto     Nacional   de   Antropología   e   Historia   (National   Institute   of

Anthropology and History)

(d)  Instituto Nacional de Bellas Artes y Literatura (National Institute of Fine Arts and

Literature)

(e) Instituto Nacional del Derecho de Autor (National Institute for Copyrights)

(f) Instituto  Nacional  de  Estudios  Históricos  de  las  Revoluciones  de  México

(National Institute of Historical Studies of Mexican Revolutions) (g)  Radio Educación (Radio Education)

  1. Secretaría de Energía (Ministry of Energy), includes:

(a) Comisión Nacional       de   Seguridad   Nuclear   y   Salvaguardias   (National

Commission on Nuclear Safety and Safeguards)

(b) Comisión Nacional para el Uso Eficiente de la Energía (National Commission for

Energy Conservation)

(c) Comisión Reguladora de Energía (Regulatory Commission of Energy)

  1. Secretaría de la Función Pública (Ministry of Public Administration)
  1. Secretaría de Gobernación (Ministry of Government), includes:

(a) Archivo General de la Nación (General Archives of the Nation)

(b) Centro Nacional  de Prevención  de Desastres  (National  Disaster  Prevention

Center)

(c) Centro de Producción  de Programas  Informativos  y Especiales  (Production

Center for Informative Programs and Specials)

(d) Coordinación  General  de  la  Comisión  Mexicana  de  Ayuda  a  Refugiados

(General Coordination of the Mexican Commission on Refugee Assistance) (e)  Instituto Nacional de Migración (National Institute of Migration)

(f) Instituto Nacional para el Federalismo  y el Desarrollo Municipal  (National

Institute for Federalism and Municipal Development) (g) Policía Federal (Federal Police)

(h)  Prevención y Readaptación Social (Prevention and Social Readaptation)

(i)  Secretariado Ejecutivo del Sistema Nacional de Seguridad Pública (Executive

Secretariat of the Public Security National System)

(j) Secretaría  General del Consejo  Nacional  de Población  (General Secretary of  the

National Population Council)

(k) Secretaría  Técnica  de  la  Comisión  Calificadora  de  Publicaciones  y  Revistas Ilustradas  (Technical  Secretary of Illustrated  Periodicals  and Publications  Examining Commission)

  1. Secretaría de Hacienda y Crédito Público (Ministry of Finance and Public Credit), includes:

(a) Comisión Nacional Bancaria y de Valores (National Banking and  Securities

Commission)

(b) Comisión Nacional de Seguros y Fianzas (National Commission of Insurance and

Guarantees)

(c) Comisión   Nacional   del   Sistema   de   Ahorro   para   el   Retiro   (National

Commission of the Saving System for Retirement)

(d) Servicio  de Administración  y Enajenación  Bienes  (Assets  Management  and

Disposition Agency)

(e) Servicio de Administración Tributaria (Tax Administration Service)

  1. Secretaría de Marina (Ministry of Navy)
  1. Secretaría de Medio Ambiente y Recursos Naturales (Ministry of Environment and

Natural Resources), includes:

(a) Instituto  Mexicano  de  Tecnología  del  Agua  (Mexican  Water  Technology

Institute)

(b) Instituto Nacional de Ecología y Cambio Climático (National Institute of Ecology and Climate Change)

  1. Secretaría de Relaciones Exteriores (Ministry of Foreign Relations)
  1. Secretaría de Salud (Ministry of Health), includes:

(a) Administración  del  Patrimonio  de  la  Beneficencia  Pública  (Public  Charity Fund

Administration)

(b) Centro Nacional de Equidad de Género y Salud Reproductiva (National Centre of

Reproductive HEalth and Gender Equity)

(c) Centro Nacional de Trasplantes (National Transplants Center)

(d)  Centro  Nacional  de la Transfusión  Sanguínea  (National  Blood Transfusion

Center)

(e) Centro Nacional para la Prevención y Control del VIH/SIDA (National Center for the Prevention and Control of HIV/AIDS)

(f)  Centro  Nacional  para la Salud de la Infancia  y la Adolescencia  (National

Center for Health of Childhood and Adolescence)

(g)  Comisión  Federal  para  la  Protección  contra  Riesgos  Sanitarios  (Federal

Commission for Protection against Health Risks)

(h) Comisión  Nacional  de Arbitraje  Médico  (National  Commission  of Medical

Arbitration)

(i) Instituto Nacional de Rehabilitación (National Rehabilitation Institute)

(j) Laboratorios de Biológicos y Reactivos de México, S.A. de C.V. (Laboratories of

Biologicals and Reagents of Mexico)

(k) Servicios de Atención Psiquiátrica (Psychiatric Attention Services)

  1. Secretaría del Trabajo y Previsión Social (Ministry of Labor and Social Welfare), includes:

(a) Procuraduría  Federal  de  la  Defensa  del  Trabajo  (Office  of  the  Federal

Attorney for Labor Defense)

  1. Secretaría de Turismo (Ministry of Tourism)

(a) Instituto de Competitividad Turística (Institute for Tourist Competitiveness)

  1. Procuraduría General de  la  República  (Office  of  the  Attorney  General  of  the

Republic)

  1. Centro de   Ingeniería   y   Desarrollo    Industrial    (Engineering    and   Industrial

Development Center)

  1. Comisión Nacional de  Libros  de  Texto  Gratuitos  (National Commission  of  Free

Textbooks)

  1. Comisión Nacional de las Zonas Áridas (National Commission on Arid Zones)
  1. Consejo  Nacional   de   Fomento   Educativo   (National Educational Development

Council)

  1. Instituto Federal de Telecomunicaciones (Federal Telecomunications Institute)

Note to Section A

English translation of entities listed in this Section is only provided for the purposes of reference; it is not an official translation.

Thresholds:

SECTION B: Other Entities

Unless otherwise specified, Chapter 13 (Government Procurement) shall cover procurement by the entities listed in this Section, in accordance with the following thresholds:

US$401,584                             Goods and Services

US$12,851,327                        Construction Services

The thresholds set out in this paragraph shall be adjusted in accordance with Section G of this

Schedule.

List of Other Entities:

  1. Aeropuerto Internacional de la Ciudad de México, S.A. de C.V. (International Airport of México City)
  2. Aeropuertos y Servicios Auxiliares (ASA) (Airports and Auxiliary Services)
  3. Caminos y Puentes Federales de Ingresos y Servicios Conexos (CAPUFE)  (Federal

Toll Roads and Bridges and Related Services)

  1. 4. Centro de Integración Juvenil, A.C (Youth Integration Centers)
  2. 5. Comisión Federal de Electricidad (CFE) (Federal Electricity Commision)
  3. 6. Comisión Nacional del Agua (National Water Commision)
  4. Comisión Nacional Forestal (National Forestry Commision)
  5. Comisión Nacional para el Desarrollo de los Pueblos Indígenas (National Commision

for the Development of Indigenous People)

  1. Consejo  Nacional  de  Ciencia  y  Tecnología  (CONACYT)  (National  Science  and

Technology Council)

  1. Consejo de Promoción Turística de México, S.A. de C.V. (México Tourism Board)
  2. Distribuidora Impulsora Comercial de Conasupo S.A. de C.V. (Diconsa) (Commercial

Distributor and Trade Promotion)

  1. Ferrocarril  del  Istmo  de  Tehuantepec,  S.A.  de  C.V.  (Railroad  of  the  Itsmo  de

Tehuatepec)

  1. Grupo Aeroportuario de la Ciudad de México S.A. de C.V. (Airport Group of México

City)

  1. Instituto Mexicano de Cinematografía (Mexican Institute of Cinematography)
  2. Instituto Mexicano de la Juventud (Mexican Youth Institute)
  3. Instituto Mexicano del Seguro Social (IMSS) (Mexican Social Security Institute)
  4. Instituto  Nacional  de  la  Infraestructura  Física  Educativa  (National  Institute  of

Physical Educational Infrastructure)

  1. Instituto Nacional de las Mujeres (Women National Institute)
  2. 19. Instituto Nacional de las Personas Adultas Mayores (Natiotal Institute for the Elderly)
  3. Instituto Nacional del Suelo Sustentable (National Institute of Sustainable Land)
  1. Instituto  Mexicano  de  la  Propiedad  Industrial  (Mexican  Institute  of   Industrial

Property.

  1. Instituto de Seguridad Social para las Fuerzas Armadas Mexicanas (Social Security for the Mexican Armed Forces Institute)
  2. Instituto  Nacional  para  la Educación  de los  Adultos  (National  Institute  for  Adult

Education)

  1. Leche Industrializada  Conasupo  S.A.  de C.V.  (Liconsa)  (No incluye  la compra  de bienes  agrícolas  adquiridos  para  programas  de  apoyo  a  la  agricultura  o  bienes  para la alimentación   humana)   (Conasupo   Industrialized   Milk)   (Not   including   procurements   of agricultural  goods  made  in furtherance  of agricultural  support  programs  or human  feeding programs)
  2. Lotería Nacional para la Asistencia Pública (National Lottery for Public Assistance)
  3. NOTIMEX S.A. de C.V.
  4. Petróleos Mexicanos  (PEMEX)  (Mexican  Petroleum)  (No  incluye  las  compras  de combustibles y gas) (Not including procurement of fuel and gas)

(a)                  PEMEX Corporativo (PEMEX Corporate)

(b)                  PEMEX Exploración y Producción (PEMEX Exploration and Production) (c)                  PEMEX Perforación y Servicios (PEMEX Drilling and Services)

(d)                  PEMEX Transformación Industrial (PEMEX Industrial Transformation)

(e)                  PEMEX Logística (PEMEX Logistics)

  1. Procuraduría   Federal   del   Consumidor   (Federal   Office   of   The   Attorney   for

Consumers)

  1. Pronósticos para la Asistencia Pública (Forecasting for Public Assistance)
  2. Servicio Aeroportuario  de la Ciudad de México, S.A. de C.V. (Airport Services  of

México City)

  1. Servicio Geológico Mexicano (Mexican Geological Service)
  2. Servicio Postal Mexicano (Mexican Postal Services)
  3. Sistema Nacional  para  el Desarrollo  Integral  de la  Familia  (DIF)  (No  incluye  las compras de bienes agrícolas adquiridos para programas de apoyo a la agricultura o bienes para la alimentación humana) (National System for Integral Family Development)  (Not including procurements  of agricultural  goods  made in furtherance of agricultural  support programs or human feeding programs).
  4. Talleres Gráficos de México (National Printers of Mexico)
  5. Telecomunicaciones de México (TELECOM) (Telecommunications of México)

Notes to Section B

  1. 1. English translation of entities listed in this Section is only provided for the purposes of reference; it is not an official translation.
  1. 2. Chapter 13 (Government Procurement) shall not apply to procurements by PEMEX and CFE of the following goods: (i) Hosiery and clothing accessories for men; (ii) Hosiery and clothing accessories for women; (iii) Special use clothes; (iv) Clothing for indoor use and night

use for men; (v) Clothing for indoor use and night use for women; (vi) Footwear for men; and (vii) Workshop machines, workshop tools and work equipment.

SECTION C: Goods

Unless otherwise specified, Chapter 13 (Government Procurement) shall cover all goods that are procured by the entities listed in Sections A and B.  However, for procurement by the Secretaría de la Defensa Nacional (Ministry of National Defense) and the Secretaría de Marina (Ministry of Navy) only the following goods are included in the coverage of this Chapter:

(Note:  numbers refer to the Federal Supply Classification (FSC) code)

FSC      Description

22         Railway equipment

23         Ground effect vehicles, motor vehicles, trailers and cycles (except buses in 2310; and military trucks and trailers in 2320 and 2330 and tracked combat, assault and tactical vehicles in 2350)

24         Tractors

25         Vehicular equipment components

26         Tires and tubes

29         Engine accessories

30         Mechanical power transmission equipment

32         Woodworking machinery and equipment

34         Metal-working machinery

35         Service and trade equipment

36         Special industry machinery

37         Agricultural machinery and equipment

38         Construction, mining, excavating, and highway maintenance equipment

39         Materials handling equipment

40         Rope, cable, chain, and fittings

41         Refrigeration, air conditioning, and air circulating equipment

42         Firefighting, rescue, and safety equipment; and environmental protection equipment and materials

43         Pumps and compressors

44         Furnace, steam plant, and drying equipment; and nuclear reactors

45         Plumbing, heating, and waste disposal equipment

46         Water purification and sewage treatment equipment

47         Pipe, tubing, hose, and fittings

48         Valves

49         Maintenance and repair shop equipment

52         Measuring tools

53         Hardware and abrasives

54         Prefabricated structures and scaffolding

55         Lumber, millwork, plywood, and veneer

56         Construction and building materials

61         Electric wire, and power and distribution equipment

62         Lighting fixtures and lamps

63         Alarm, signal and security detection systems

65         Medical, dental, and veterinary equipment and supplies

66         Instruments and laboratory equipment

67         Photographic equipment

68         Chemicals and chemical products

69         Training aids and devices

70         Automatic data processing equipment (including firmware), software, supplies and support equipment

71         Furniture

72         Household and commercial furnishings and appliances

73         Food preparation and serving equipment

74         Office machines, text processing systems and visible record equipment

75         Office supplies and devices

76         Books, maps, and other publications (except 7650: drawings and specifications)

77         Musical instruments, phonographs, and home-type radios

78         Recreational and athletic equipment

79         Cleaning equipment and supplies

80         Brushes, paints, sealers, and adhesives

81         Containers, packaging, and packing supplies

85         Toiletries

87         Agricultural supplies

88         Live animals

91         Fuels, lubricants, oils, and waxes

93         Nonmetallic fabricated materials

94         Nonmetallic crude materials

96         Ores, minerals, and their primary products (except 9620: minerals, natural and synthetic)

99         Miscellaneous

SECTION D: Services

Chapter 13 (Government Procurement) shall not cover the procurement of the following services identified in accordance with the North American Free trade Agreement  (NAFTA) Common Classification System, Appendix 1001.1b-2-B of NAFTA that are procured by entities listed in Sections A and B:

A Research and Development
All classes
C Architecture and Engineering Services
C130 Restoration (only for preservation of historic sites and buildings)
D Information Processing and Related Telecommunications Services
D304 ADP Telecommunications  and Transmissions Services except for those  services
that are classified  as enhanced  or value added, defined  as  telecommunications
services  using  computerized  processing  systems,  which: (a) act on the format,
content, code, protocol or similar aspects of the information transmitted by the user,
(b) provide the customer with additional, different or restructured information, or
(c) involve user interaction with stored information. For purposes of this provision,
the acquisition of ADP Telecommunications  and Transmission  Services do  not
include the ownership or furnishing of facilities for voice or data  transmission
services.
D305 ADP Services for Teleprocessing and Timeshare.
D309 Information and Data Broadcasting Services or Data Distribution Services.
D316 Telecommunications Network Management Services.
D317 Automated  News  Services,  Data  Services,  or  Other  Information  Services
Buying Data (the electronic equivalent of books, periodicals, newspapers, etc.)
D399 Other ADP Telecommunications Services (includes data storage on tape, CDs,
etc.)
F Natural Resources Services.
F011 Pesticides/Insecticides Support Services
G Health and Social Services.
All classes
J Maintenance,  Repair,  Modification,  Rebuilding  and  Installation  of  Goods  /
Equipment
J010 Armament
J011 War Nuclear Material
J012 Fire Equipment and Control
J013 Ammunition and Explosives
J014 Guided Missiles
J015 Aircrafts and Aircraft Structures Components
J016 Aircrafts Components and Accessories
J017 Takeoff, Landing, and Ground Handling Aircraft Equipment
K

L R

J018

J019

Space Vehicles

Shipments, Small Structures, Barges and Floating Docks

J020

J022

J023

J024

J025

J998

K103

K105

K109

K110

R003

R004

R012

R016

R101

R103

R105

Boats and Marine Equipment

Rail Equipment

Land Vehicles, Motored Vehicles, Trailers and Motorcycles

Tractors

Motor Vehicles Parts

Non-nuclear Ships Repair

Custodial  Operations  and  Related  Services  (professional  services  only  for protection, personal security installations carried out by armed guards)

Fueling and Other Petroleum Services –Excluding Storage-

Guard services (professional services only for protection, personal security and surveillance installations carried out by armed guards)

Surveillance   services  (professional   services  only  for  protection,   personal security and surveillance installations carried out by armed guards)

Solid Fuel Handling Services Financial and Related Services All classes

Professional, Administrative and Management Support Services

Legal Services

Certifications  and  Accreditations  for  products  and  institutions  other  than

Educational Institutions

Patent and Trade Mark Services

Personal Services Contracts

Expert Witness (Only for legal services) Courier and Messenger Services

Mail and Distribution Services (Post Office Services excluded)

S T R106

R116

R200

T000

T001

T002

T003

T004

T005

T008

T009

T010

T013

Post Office Services

Court Reporting Services Military Recruitment Utilities

All classes

Communications, Photographic, Mapping, Printing and Publication Services

Communications Studies

Market Research and Public Opinion Services (Formerly Telephone and Field Interviews services, including Focus testing, Syndicated and attitude surveys) Except for CPC 86503 Management Consulting Marketing Services. Communication Services (including Exhibit Services)

Advertising Services

Public  Relations  Services  (Including  Writing  Services,  Even  Planning  and

Management, Media Relations, Radio and TV Analysis, Press Services) Arts / Graphics Services

Film Processing Services

Film / Video Production Services

Microfiche Services

General Photography Services – Still

T014

T015

Print / Binding Services

Reproduction Services

T017 General Photography Services – Motion
T018 Audio / Visual Services
T099 Other   Communication,   Photography,   Mapping,   Printing   and   Publication
Services
U Educational and Training Services
U003 Reserves Training (Military)
U010 Certifications and Accreditations for Educational Institutions
V Transportation, Travel and Relocation Services
All classes (except V503 Travel Agent Services)
W Lease and Rental of equipment which require patent protection, copyright or
other proprietary rights.
W058 Communication, Detection and Coherent Radiation Equipment

Notes to Section D

  1. The provisions of Chapter 13 (Government Procurement) shall not apply to the operation of government facilities under concessions.
  1. All  services  related  to  goods  acquired  by  the  Secretaría  de  la  Defensa  Nacional (Ministry of National Defense) and the Secretaría de Marina (Ministry of Navy) that are not covered by this Chapter, shall be excluded.
  1. All services  that are not excluded  from the coverage  of Chapter  13  (Government Procurement)  shall be subject to Chapter 15 (Cross-Border  Trade in  Services)  and Annex I and Annex II of this Agreement.
  1. The   management   and   operating   services   contracts   awarded   to   research   and development centers operating with federal funds, or related to the implementation of research programs sponsored by the government shall be excluded from the disciplines of  Chapter 13 (Government Procurement).

SECTION E: Construction Services

Chapter 13 (Government Procurement) shall    apply    to    all    construction    services procured by the entities listed in Sections A and B, identified in Division 51 of  the United Nations  Provisional  Central  Product  Classification  (CPC  Prov)  which  can  be  found  at: https://unstats.un.org/unsd/cr/registry/regcs.asp?Cl=9&Lg=1&Co=51,        unless        otherwise specified in Chapter 13 (Government Procurement) including this Schedule.

SECTION F: General Notes

The following General Notes shall apply to Chapter 13 (Government Procurement), including Sections A through E:

  1. Chapter 13 (Government Procurement) shall not apply to procurements made:

(a)        with a view to commercial resale by government owned retail stores;

(b)       pursuant to loans from regional or multilateral financial institutions to the extent that different procedures are imposed by such institutions (except for national content requirements); or

(c)       by one entity from another entity of Mexico.

  1. Chapter   13   (Government   Procurement)   shall   not   apply   to   the   procurement   of transportation services that are part of, or are incidental to a purchase contract.
  1. Chapter 13 (Government Procurement) shall not apply to build-operate-transfer contracts and public works concessions contracts.
  1. Notwithstanding  any provision  in Chapter 13 (Government Procurement),  Mexico may set aside procurement contracts from the obligations of Chapter 13 (Government Procurement), subject to the following:
(a) the  total  value  of the  contracts  set  aside  may  not  exceed  the  Mexican  peso equivalent of  US$2,328,000,000 in each calendar year of the date of entry into force  of this  Agreement  for Mexico,  which may be allocated  by  all entities, including PEMEX and CFE;
(b) the total value of contracts under any single FSC class (or other classification system agreed by the Parties) that may be set aside under this paragraph in any year shall not exceed 10 per cent of the total value of contracts that may be set aside under this paragraph for that year;
(c) no entity subject to subparagraph (a) may set aside contracts in any calendar year of a value of more than 20 per cent of the total value of contracts that may be set aside for that year; and
(d) the total value of the contracts set aside by PEMEX and CFE may not exceed the

Mexican peso equivalent of US$466,000,000 in each calendar year.

5. (a) Beginning in January of the next calendar year after the date of entry into force

of this Agreement  for Mexico, the dollar values referred to in paragraph  4 shall be adjusted

annually for cumulative inflation from January 2017, based on the implicit price deflator for the

United States Gross Domestic Product (USGDP) or any successor index published by the Council

of Economic Advisors in “Economic Indicators”.

(b)      The dollar values adjusted for cumulative inflation up to January  of each calendar year following 2016 shall be equal to the original dollar values multiplied by the ratio of:

(i)         the implicit USGDP price deflator or any successor index published by the Council of Economic Advisors in “Economic Indicators”, current as of January of that year, to

(ii)       the implicit USGDP price deflator or any successor index published by the Council of Economic Advisors in “Economic Indicators”, current as of the date of entry into force of this Agreement for Mexico,

provided that the price deflators under subparagraphs (i) and (ii) have the same base year.

(c)       The resulting adjusted dollar values shall be rounded to the nearest million dollars.

  1. The  national  security  exception  provided  for  in  Article  32.2  (Security  Exceptions)

shall cover procurements made in support of safeguarding nuclear materials or technology.

  1. (a)       Notwithstanding  any  provision  of Chapter 13 (Government Procurement),  an entity may impose a local content requirement of no more than:

(i)        40 per cent, for labor-intensive turnkey or major integrated projects; or

(ii)       25 per cent, for capital-intensive turnkey or major integrated projects.

(b)       For the purposes of this paragraph, “turnkey or major integrated project” means, in general, a construction, supply or installation project undertaken by a person pursuant to a right granted by an entity with respect to which:

(i)         the prime contractor  is vested  with the authority  to select  the  general contractors or subcontractors;

(ii)       neither the Government of Mexico nor its entities fund the project; (iii)      the person bears the risks associated with non-performance; and

(iv)       the facility will be operated by an entity or through a procurement contract of that entity.

  1. In the event that Mexico exceeds in any given year the total value of contracts it may set aside for that year in accordance with paragraph 4 of this Section, Mexico shall consult with the other Parties with a view to agreement on compensation in the form of additional procurement opportunities  during the following  year. The consultations  shall  be  without  prejudice  to the rights of any Party under Chapter 31 (Dispute Settlement).

SECTION G: Thresholds Adjustment Formula

  1. The thresholds in Sections A and B shall be calculated in accordance with the following: (a)  the U.S. inflation rate shall be measured by the Producer Price Index for Finished

Goods published by the U.S. Bureau of Labor Statistics;

(b)       adjustments  shall be calculated using two-year periods, each period  beginning November 1, and shall take effect on January 1 of the year immediately following the end of the two-year period;

(c)       the United States shall notify the other Parties of the adjusted threshold values no later than November 16 of the year before the adjustment takes effect; and

(d)       the inflationary adjustment shall be estimated according to the following formula

ܶ଴ x ሺ1൅ ߨ௜ሻ ൌ ܶଵ

ܶ଴ = threshold value at base period

ߨ௜= accumulated U.S. inflation rate for the ith two year-period

ܶଵ= new threshold value.

  1. Mexico shall calculate and convert the value of the thresholds into Mexican pesos using the conversion rate of the Banco de México (Bank of Mexico). The conversion rate shall be the existing value of the Mexican peso in terms of the U.S. dollar as of December 1 and June 1 of each year, or the first working day thereafter.  The conversion rate as of December 1 shall apply from January 1 to June 30 of the following year, and the conversion rate as of June 1 shall apply from July 1 to December 31 of that year.
  1. Information related with thresholds shall be published in www.compranet.gob.mx

SECTION H: Procurement Information

Information on government procurement shall be published in the following websites:

www.dof.gob.mx

www.compranet.gob.mx

www.pemex.com

www.cfe.mx

SCHEDULE OF THE UNITED STATES

SECTION A:  Central Government Entities

Thresholds:

  1. Chapter 13 (Government Procurement) shall apply to the entities of the central level of government listed in this Section where the value of the procurement is estimated, in accordance with Article 13.2.8 and Article 13.2.9, to equal or exceed:

(a)  for procurement of goods and services:  US$80,317; and

(b)  for procurement of construction services:  US$10,441,216

The thresholds set out in this paragraph shall be adjusted in accordance with Section G

of this Schedule.

  1. Unless otherwise specified herein, Chapter 13 (Government Procurement) shall apply to all agencies subordinate to the entities listed in this Section.

List of Entities:

  1. American Battle Monuments Commission
  2. Broadcasting Board of Governors
  3. Commission on Civil Rights
  4. Commodity Futures Trading Commission
  5. Consumer Product Safety Commission
  6. Corporation for National and Community Service
  7. Department of Agriculture (Note 1)
  8. Department of Commerce
  9. Department of Defense (Note 2)
  10. Department of Education
  11. Department of Energy (Note 3)
  12. Department of Health and Human Services
  13. Department of Homeland Security (Note 4)
  14. Department of Housing and Urban Development
  15. Department of the Interior, including the Bureau of Reclamation
  16. Department of Justice
  17. Department of Labor
  18. Department of State
  19. Department of Transportation
  20. Department of the Treasury
  21. Department of Veterans Affairs
  22. Environmental Protection Agency
  23. Equal Employment Opportunity Commission
  24. Executive Office of the President
  25. Export-Import Bank of the United States
  1. Farm Credit Administration
  2. Federal Communications Commission
  3. Federal Deposit Insurance Corporation
  4. Federal Housing Finance Agency
  5. Federal Maritime Commission
  6. Federal Mediation and Conciliation Service
  7. Federal Trade Commission
  8. General Services Administration (Note 5)
  9. Merit Systems Protection Board
  10. National Aeronautics and Space Administration
  11. National Archives and Records Administration
  12. National Credit Union Administration
  13. National Labor Relations Board
  14. National Mediation Board
  15. National Science Foundation
  16. National Transportation Safety Board
  17. Nuclear Regulatory Commission
  18. Office of Personnel Management
  19. Overseas Private Investment Corporation
  20. Peace Corps
  21. Railroad Retirement Board
  22. Rural Utilities Services (Note 6)
  23. Securities and Exchange Commission
  24. Selective Service System
  25. Smithsonian Institution
  26. United States Agency for International Development
  27. United States International Trade Commission

Notes to Section A

  1. Department  of Agriculture:  Chapter  13 (Government  Procurement)  shall not  cover procurement of any agricultural good made in furtherance of an agricultural support program or a human feeding program.
  1. Department of Defense:

(a)       Chapter 13 (Government Procurement) shall not cover procurement of any good described in any Federal Supply Code classification (for complete listing of U.S. Federal Supply Classification, see any of the following Federal Supply Code (FSC), which can be found in the Product Code Section of the Federal Procurement Data System Product and Service Code Manual at https://www.acquisition.gov/Acquisition_Systems) listed below:

FSC                Description

FSC 11           Nuclear Ordnance

FSC 1555       Space Vehicles

FSC 1675       Space Vehicle Component

FSC 1677       Space Vehicle Remote Control System

FSC 1725       Space Vehicle Launchers

FSC 1735       Space Vehicle Handling and Servicing Equipment

FSC 19           Ships, Small Craft, Pontoons, and Floating Docks (the part of this classification defined as naval vessels or major components of the hull or superstructure thereof)

FSC 20           Ship and Marine Equipment (the part of this classification

defined as naval vessels or major components of the hull or superstructure thereof)

FSC 2310       Passenger Motor Vehicles (only buses)

FSC 2350       Combat, Assault & Tactical Vehicles, Tracked

FSC 51           Hand Tools

FSC 52           Measuring Tools

FSC 60           Fiber Optics Materials, Components, Assemblies, and

Accessories

FSC 8140       Ammunition & Nuclear Ordnance Boxes, Packages & Special

Containers

FSC 83           Textiles, Leather, Furs, Apparel, Shoe Findings, Tents, and Flags (all elements other than pins, needles, sewing kits, flagstaffs, flagpoles, and flagstaff trucks)

FSC 84           Clothing, Individual Equipment, and Insignia and Jewelry (all elements other than sub-class 8457 – jewelry and 8460 – luggage)

FSC 89           Subsistence (all elements other than sub-class 8975- tobacco products)

(b)           Chapter 13 (Government Procurement) shall not cover procurement  of any specialty metal or any good containing one or more specialty metals.  Specialty metal means:

(i)            steel for which the maximum alloy content exceeds one or more of the following levels: manganese, 1.65 per cent; silicon, 0.60 per cent; or copper,

0.60 per cent;

(ii)           steel that contains more than 0.25 per cent of any of the following elements: aluminum, chromium, cobalt, columbium, molybdenum, nickel, titanium, tungsten or vanadium;

(iii)          a metal alloy consisting of a nickel, iron-nickel or cobalt base alloy that contains a total of other alloying metals (except iron) in excess of 10 per cent;

(iv)          titanium or a titanium alloy; or

(v)           zirconium or a zirconium base alloy.

(c)            Chapter   13   (Government   Procurement)   generally   shall   not   cover procurement of any good described in any of the following FSC classifications, due to the application of Article X.X (Security Exceptions):

FSC                 Description

FSC 10           Weapons

FSC 12           Fire Control Equipment

FSC 13           Ammunitions and Explosives

FSC 14           Guided Missiles

FSC 15           Aerospace Craft and Structural Components

FSC 16           Aerospace Craft Components and Accessories

FSC 17           Aerospace Craft Launching, Landing and Ground Handling and Servicing Equipment

FSC 19           Ships, Small Craft, Pontoons and Floating Docks

FSC 20           Ship and Marine Equipment

FSC 28           Engines, Turbines and Components

FSC 31           Bearings

FSC 58           Communications, Detection, and Coherent Radiation

Equipment

FSC 59           Electrical and Electronic Equipment Components

FSC 95           Metal Bars, Sheets, and Shapes

  1. Department of Energy: Due to the application of Article 32.2 (Essential Security), Chapter 13 (Government Procurement) shall not cover procurement of:

(a)       any good or service that supports the safeguarding of nuclear materials or technology, where the Department of Energy conducts the procurement under the authority of the Atomic Energy Act; or

(b)       any oil purchase related to the Strategic Petroleum Reserve.

  1. Department of Homeland Security:
  1. a) Chapter 13  (Government  Procurement)   shall  not  cover  procurement  by   the Transportation Security Administration of FSC 83 (Textiles, Leather, Furs, Apparel, Shoe Findings, Tents and Flags) and FSC 84 (Clothing, Individual Equipment, and Insignia and Jewelry).
  1. b) The national security considerations applicable to the Department of Defense shall apply equally to the S. Coast Guard.
  1. General Services Administration:   Chapter 13  (Government  Procurement) shall  not cover procurement of any good in any of the following FSC classifications:

FSC                Description

FSC 51           Hand Tools

FSC 52           Measuring Tools

FSC 7340       Cutlery and Flatware

  1. Rural Utilities Service:  Federal buy national requirements imposed as conditions of funding by the Rural Utilities Service will not apply to goods of Mexico, suppliers of such goods, and service suppliers of Mexico.

SECTION B:  Other Entities

Thresholds:

  1. Chapter 13 (Government Procurement) shall apply to the other covered entities listed in this Section where the value of the procurement is estimated, in accordance with Article

13.2.8 (Scope) and Article 13.2.9, to equal or exceed:

(a)       for procurement of goods and services: US$401,584; and

(b)       for procurement of construction services: US$12,851,327

The monetary threshold set out in subparagraph (b) shall be adjusted in accordance with

Section G of this Schedule.

  1. Unless otherwise specified herein, Chapter 13 (Government Procurement) shall apply only to the entities listed in this Section.

List of Entities:

  1. Tennessee Valley Authority
  2. Bonneville Power Administration
  3. Western Area Power Administration
  4. Southeastern Power Administration
  5. Southwestern Power Administration
  6. St. Lawrence Seaway Development Corporation

SECTION C: Goods

Chapter 13 (Government Procurement) shall cover all goods procured by the  entities listed in Sections A and B, subject to the Notes to the respective Sections and the General Notes.

SECTION D:  Services

Chapter 13 (Government Procurement) shall cover all services procured by the entities listed in Sections A and B, subject to the Notes to the respective Sections, the General Notes and the Notes to this Section.

Notes to Section D

  1. This Chapter does not cover the procurement of the following services, as elaborated in the Common Classification System (For complete listing of Common Classification System, see http://www.sice.oas.org/trade/nafta/chap-105.asp.):
  1. Research and Development:

All classes

  1. Information Processing and Related Telecommunications Services:

D304   ADP Telecommunications and Transmission Services, except for those services classified as “enhanced or value-added services.” For the purposes of this provision, the procurement of “ADP Telecommunications and Transmission Services” does not include the ownership or furnishing of facilities for the transmission of voice or data services.

D305   ADP Teleprocessing and Timesharing Services

D316   Telecommunications Network Management Services

D317   Automated News Services, Data Services or Other Information Services

D399   Other ADP and Telecommunications Services

  1. Maintenance, Repair, Modification, Rebuilding and Installation of Goods/Equipment: J019 Maintenance, Repair, Modification, Rebuilding and Installation of Equipment Related to Ships

J998    Non-nuclear Ship Repair

  1. Operation of Government-Owned Facilities:

All facilities operated by the Department of Defense, Department of Energy, and the

National Aeronautics and Space Administration; and for all entities: M180  Research and Development facilities

  1. Utilities:

All Classes

  1. Transportation, Travel and Relocation Services: All Classes except V503 Travel Agent Services
  1. Chapter 13 (Government Procurement) shall not cover procurement of any service in support of military forces located overseas.

SECTION E:  Construction Services

Chapter 13 (Government  Procurement)  shall cover all construction  services procured by the entities listed in Sections A and C, listed in Division 51 of the Provisional Central Product Classification                           (CPC),             which             is             found             at: https://unstats.un.org/unsd/cr/registry/regcs.asp?Cl=9&Lg=1&Co=51,  subject  to the Notes to the  respective  Sections,  the  General  Notes  and  the  Notes  to  this  Section,  except  for  the construction services excluded in the Schedule of a Party.

Note to Section E

Chapter 13 (Government Procurement) shall not cover procurement of dredging services.

SECTION F:  General Notes

Unless  otherwise  specified  herein,  the following  General  Notes shall apply  without exception to Chapter 13 (Government Procurement), including to all sections of this Schedule.

  1. Chapter 13 (Government Procurement) shall not apply to any set-aside on behalf of a small- or minority-owned business. A set-aside may include any form of preference, such as the exclusive right to provide a good or service, or any price preference.
  1. Chapter 13 (Government Procurement) shall not cover procurement of transportation services that form a part of, or are incidental to, a procurement contract.
  1. For goods and services (including construction services) of Mexico and suppliers of such goods and services, this Chapter does not apply to procurement done by the contractual means

of build-operate-transfer contract or public works concessions contract.  The United States is prepared to amend this note at such time as coverage with respect to build-operate-transfer contracts and public works concessions contracts can be resolved with Mexico.

SECTION G:  Threshold Adjustment Formula

  1. Any threshold denominated in U.S. Dollars shall be made in accordance with the following:

(a)       the U.S. inflation rate shall be measured by the Producer Price Index for

Finished Goods published by the U.S. Bureau of Labor Statistics;

(b)        the first adjustment for inflation, to take effect on January 1, 2020, shall be calculated using the period from November 1, 2017 through October 31, 2019;

(c)       all subsequent adjustments shall be calculated using two-year periods, each period beginning November 1, and shall take effect on January 1 of the year immediately following the end of the two-year period;

(d)        the United States shall notify the other Parties of the adjusted threshold values no later than December 16 of the year before the adjustment takes effect; and

(e)       the inflationary adjustment shall be estimated according to the following formula

T 0 x (1+ pi i ) = T 1

T 0 = threshold value at base period

pi i = accumulated U.S. inflation rate for the ith two year-period

T 1 = new threshold value.

SECTION H:  Procurement Information

Publications utilized by the United States for the publication of notices of intended procurement  and  of post-award  notices  and  the  publication  annually  of  information  on permanent lists of qualified suppliers in the case of selective tendering procedures:

Federal Business Opportunities (http://www.fedbizopps.gov)

Laws, regulations, judicial decisions, administrative rulings and procedures regarding government  procurement  for entities  listed in Section A are published  on  the following websites:

US Federal Laws (primarily US Code Titles 10 and 41):

http://www.gpo.gov/fdsys/browse/collectionUScode.action?collectionCode=USCODE

Federal Acquisition Regulation (FAR):  http://www.acquisition.gov/far/index.html

Agency Supplemental Regulations:

https://www.acquisition.gov/Supplemental_Regulations

Federal Register: https://www.federalregister.gov/

Federal Government Procurement Policies:

http://www.whitehouse.gov/omb/procurement/

Bid Protest Decisions of Government Accountability Office:

http://www.gao.gov/legal/bidprotest.html

US Civilian Board of Contract Appeals Decisions:  http://www.cbca.gsa.gov/

Judicial Decisions:

US Court of Federal Claims (jurisdiction includes claims related to government contracts, including bid protests): http://www.uscfc.uscourts.gov/

US Court of Appeals for the Federal Circuit (jurisdiction includes appeals from the US Civilian Boards of Contract Appeals): http://www.cafc.uscourts.gov/

Laws, judicial decisions, administrative rulings and procedures regarding government procurement for entities listed in Section B are available directly from the listed entities.

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