DFARS stands for Defense Federal Acquisition Regulation Supplement.
It is a set of restrictions for the origination of raw materials intended to protect the US defense industry from the vulnerabilities of being overly dependent on foreign sources of supply.
For those of you with government or defense-related contracts, compliance with DFARS is crucial.
In our industry, the supply and fabrication of refractory metals, we’re concerned with three clauses related to the acquisition of specialty metals. More information on DFARS restrictions to the acquisition of specialty metals follows below.
For detailed information on all aspect of DFARS, visit the Defense Acquisition Regulation’s websites at https://www.acq.osd.mil/dpap/dars/about.html https://www.acq.osd.mil/dpap/dars/dfarspgi/current/index.html
252.225-7008 Restriction on Acquisition of Specialty Metals.
252.225-7009 Restriction on Acquisition of Certain Articles Containing Specialty Metals
252.225-7052 Restriction on the Acquisition of Certain Magnets and Tungsten.
These clauses provide specific rules about what’s considered a “specialty metal,” and which countries those metals must be melted in. A copy of the clauses are shown below.
DFARS Qualifying Countries
The term DFARS compliant refers to materials (metal or otherwise) that come from domestic or NATO sources. However, there are countries included in DFARS that are not members of NATO.
DFARS qualifying countries (Per DFARS 225.872-1) include:
- Australia
- Austria
- Belgium
- Canada
- Czech Republic
- Denmark
- Egypt
- Estonia
- Finland
- France
- Germany
- Greece
- Israel
- Italy
- Japan
- Latvia
- Luxembourg
- Netherlands
- Norway
- Poland
- Portugal
- Slovenia
- Spain
- Sweden
- Switzerland
- Turkey
- United Kingdom of Great Britain and Northern Ireland
Which Specialty Metals Require DFARS Standards?
Not every metal used in government or defense contracts requires DFARS’ standards.
DFARS UPDATE December 31, 2019 – TUNGSTEN ALLOYS NOW RESTRICTED FOR DFARS CONTRACTS
On December 31, 2019 a new set of restrictions on the acquisition of tungsten alloys (tungsten heavy metal) were incorporated in Section 871 of the 2019 National Defense Authorization Act (NDAA). The updated NDAA now restricts U.S. Defense Industry related acquisition of tungsten powder, tungsten heavy alloy and certain other materials that have been melted or produced in China, North Korea, Russia & Iran. These new restrictions cover tungsten powder and tungsten heavy alloy mill products such as bar, billet, slab, wire, cube, sphere, block, blank, plate or sheet.
Whereas pure tungsten and steel alloyed with tungsten were already restricted metals for DFARS contracts, any tungsten alloy that contains 50% or more tungsten by weight is now also restricted.
DFARS “Specialty Metals” requiring compliance (Per DFARS 252.225-7008):
Steel: With a maximum alloy content exceeding one or more of the following limits: manganese, 1.65 percent; silicon, .60 percent; or copper, .60 percent; or Containing more than 0.25 percent of any of the following elements: aluminum, chromium, cobalt, columbium (niobium), molybdenum, nickel, titanium, tungsten, or vanadium;
Metal alloys consisting of nickel, iron-nickel, and cobalt base alloys containing a total of other alloying metals (except iron) in excess of 10 percent;
Titanium and titanium alloys; or Zirconium and zirconium base alloys.
Therefore, tungsten, tungsten alloys, molybdenum, TZM Molybdenum alloy and Niobium fall under the DFARS compliance laws. However, Tantalum is exempt.
252.225-7008 Restriction on Acquisition of Specialty Metals.
As prescribed in 225.7003-5(a)(1), use the following clause:
RESTRICTION ON ACQUISITION OF SPECIALTY METALS (MAR 2013)
(a) Definitions. As used in this clause—
“Alloy” means a metal consisting of a mixture of a basic metallic element and one or more metallic, or non-metallic, alloying elements.
(i) For alloys named by a single metallic element (e.g., titanium alloy), it means that the alloy contains 50 percent or more of the named metal (by mass).
(ii) If two metals are specified in the name (e.g, nickel-iron alloy), those metals are the two predominant elements in the alloy, and together they constitute 50 percent or more of the alloy (by mass).
“Produce” means—
(i) Atomization;
(ii) Sputtering; or
(iii) Final consolidation of non-melt derived metal powders.
“Specialty metal” means—
(i) Steel—
(A) With a maximum alloy content exceeding one or more of the following limits: manganese, 1.65 percent; silicon, 0.60 percent; or copper, 0.60 percent; or
(B) Containing more than 0.25 percent of any of the following elements: aluminum, chromium, cobalt, molybdenum, nickel, niobium (columbium), titanium, tungsten, or vanadium;
(ii) Metal alloys consisting of—
(A) Nickel or iron-nickel alloys that contain a total of alloying metals other than nickel and iron in excess of 10 percent; or
(B) Cobalt alloys that contain a total of alloying metals other than cobalt and iron in excess of 10 percent;
(iii) Titanium and titanium alloys; or
(iv) Zirconium and zirconium alloys.
“Steel” means an iron alloy that includes between .02 and 2 percent carbon and may include other elements.
(b) Any specialty metal delivered under this contract shall be melted or produced in the United States or its outlying areas.
252.225-7009 Restriction on Acquisition of Certain Articles Containing Specialty Metals.
As prescribed in 225.7003-5(a)(2), use the following clause:
RESTRICTION ON ACQUISITION OF CERTAIN ARTICLES CONTAINING SPECIALTY METALS
(OCT 2014)
(a) Definitions. As used in this clause—
“Alloy” means a metal consisting of a mixture of a basic metallic element and one or more metallic, or non-metallic, alloying elements.
(i) For alloys named by a single metallic element (e.g., titanium alloy), it means that the alloy contains 50 percent or more of the named metal (by mass).
(ii) If two metals are specified in the name (e.g, nickel-iron alloy), those metals are the two predominant elements in the alloy, and together they constitute 50 percent or more of the alloy (by mass).
“Assembly” means an item forming a portion of a system or subsystem that—
(i) Can be provisioned and replaced as an entity; and
(ii) Incorporates multiple, replaceable parts.
“Commercial derivative military article” means an item acquired by the Department of Defense that is or will be produced using the same production facilities, a common supply chain, and the same or similar production processes that are used for the production of articles predominantly used by the general public or by nongovernmental entities for purposes other than governmental purposes.
“Commercially available off-the-shelf item”—
(i) Means any item of supply that is—
(A) A commercial item (as defined in paragraph (1) of the definition of “commercial item” in section 2.101 of the Federal Acquisition Regulation);
(B) Sold in substantial quantities in the commercial marketplace; and
(C) Offered to the Government, under this contract or a subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and
(ii) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.
“Component” means any item supplied to the Government as part of an end item or of another component.
“Electronic component” means an item that operates by controlling the flow of electrons or other electrically charged particles in circuits, using interconnections of electrical devices such as resistors, inductors, capacitors, diodes, switches, transistors, or integrated circuits. The term does not include structural or mechanical parts of an assembly containing an electronic component, and does not include any high performance magnets that may be used in the electronic component.
“End item” means the final production product when assembled or completed and ready for delivery under a line item of this contract.
“High performance magnet” means a permanent magnet that obtains a majority of its magnetic properties from rare earth metals (such as samarium).
“Produce” means—
(i) Atomization;
(ii) Sputtering; or
(iii) Final consolidation of non-melt derived metal powders.
“Qualifying country” means any country listed in the definition of “Qualifying country” at 225.003of the Defense Federal Acquisition Regulation Supplement (DFARS).
“Required form” means in the form of mill product, such as bar, billet, wire, slab, plate, or sheet, and in the grade appropriate for the production of—
(i) A finished end item to be delivered to the Government under this contract; or
(ii) A finished component assembled into an end item to be delivered to the Government under this contract.
“Specialty metal” means—
(i) Steel—
(A) With a maximum alloy content exceeding one or more of the following limits: manganese, 1.65 percent; silicon, 0.60 percent; or copper, 0.60 percent; or
(B) Containing more than 0.25 percent of any of the following elements: aluminum, chromium, cobalt, molybdenum, nickel, niobium (columbium), titanium, tungsten, or vanadium;
(ii) Metal alloys consisting of—
(A) Nickel or iron-nickel alloys that contain a total of alloying metals other than nickel and iron in excess of 10 percent; or
(B) Cobalt alloys that contain a total of alloying metals other than cobalt and iron in excess of 10 percent;
(iii) Titanium and titanium alloys; or
(iv) Zirconium and zirconium alloys.
“Steel” means an iron alloy that includes between .02 and 2 percent carbon and may include other elements.
“Subsystem” means a functional grouping of items that combine to perform a major function within an end item, such as electrical power, attitude control, and propulsion.
(b) Restriction. Except as provided in paragraph (c) of this clause, any specialty metals incorporated in items delivered under this contract shall be melted or produced in the United States, its outlying areas, or a qualifying country.
(c) Exceptions. The restriction in paragraph (b) of this clause does not apply to—
(1) Electronic components.
(2)(i) Commercially available off-the-shelf (COTS) items, other than—
(A) Specialty metal mill products, such as bar, billet, slab, wire, plate, or sheet, that have not been incorporated into COTS end items, subsystems, assemblies, or components;
(B) Forgings or castings of specialty metals, unless the forgings or castings are incorporated into COTS end items, subsystems, or assemblies;
(C) Commercially available high performance magnets that contain specialty metal, unless such high performance magnets are incorporated into COTS end items or subsystems; and
(D) COTS fasteners, unless—
(1) The fasteners are incorporated into COTS end items, subsystems, assemblies, or components; or
(2) The fasteners qualify for the commercial item exception in paragraph (c)(3) of this clause.
(ii) A COTS item is considered to be “without modification” if it is not modified prior to contractual acceptance by the next higher tier in the supply chain.
(A) Specialty metals in a COTS item that was accepted without modification by the next higher tier are excepted from the restriction in paragraph (b) of this clause, and remain excepted, even if a piece of the COTS item subsequently is removed (e.g., the end is removed from a COTS screw or an extra hole is drilled in a COTS bracket).
(B) Specialty metals that were not contained in a COTS item upon acceptance, but are added to the COTS item after acceptance, are subject to the restriction in paragraph (b) of this clause (e.g., a special reinforced handle made of specialty metal is added to a COTS item).
(C) If two or more COTS items are combined in such a way that the resultant item is not a COTS item, only the specialty metals involved in joining the COTS items together are subject to the restriction in paragraph (b) of this clause (e.g., a COTS aircraft is outfitted with a COTS engine that is not the COTS engine normally provided with the aircraft).
(D) For COTS items that are normally sold in the commercial marketplace with various options, items that include such options are also COTS items. However, if a COTS item is offered to the Government with an option that is not normally offered in the commercial marketplace, that option is subject to the restriction in paragraph (b) of this clause (e.g. – An aircraft is normally sold to the public with an option for installation kits. The Department of Defense requests a military-unique kit. The aircraft is still a COTS item, but the military-unique kit is not a COTS item and must comply with the restriction in paragraph (b) of this clause unless another exception applies).
(3) Fasteners that are commercial items, if the manufacturer of the fasteners certifies it will purchase, during the relevant calendar year, an amount of domestically melted or produced specialty metal, in the required form, for use in the production of fasteners for sale to the Department of Defense and other customers, that is not less than 50 percent of the total amount of the specialty metal that it will purchase to carry out the production of such fasteners for all customers.
(4) Items manufactured in a qualifying country.
(5) Specialty metals for which the Government has determined in accordance with DFARS 225.7003-3 that specialty metal melted or produced in the United States, its outlying areas, or a qualifying country cannot be acquired as and when needed in—
(i) A satisfactory quality;
(ii) A sufficient quantity; and
(iii) The required form.
(6) End items containing a minimal amount of otherwise noncompliant specialty metals (i.e., specialty metals not melted or produced in the United States, an outlying area, or a qualifying country, that are not covered by one of the other exceptions in this paragraph (c)), if the total weight of such noncompliant metals does not exceed 2 percent of the total weight of all specialty metals in the end item, as estimated in good faith by the Contractor. This exception does not apply to high performance magnets containing specialty metals.
(d) Compliance for commercial derivative military articles.
(1) As an alternative to the compliance required in paragraph (b) of this clause, the Contractor may purchase an amount of domestically melted or produced specialty metals in the required form, for use during the period of contract performance in the production of the commercial derivative military article and the related commercial article, if—
(i) The Contracting Officer has notified the Contractor of the items to be delivered under this contract that have been determined by the Government to meet the definition of “commercial derivative military article”; and
(ii) For each item that has been determined by the Government to meet the definition of “commercial derivative military article,” the Contractor has certified, as specified in the provision of the solicitation entitled “Commercial Derivative Military Article—Specialty Metals Compliance Certificate” (DFARS 252.225-7010), that the Contractor and its subcontractor(s) will enter into a contractual agreement or agreements to purchase an amount of domestically melted or produced specialty metal in the required form, for use during the period of contract performance in the production of each commercial derivative military article and the related commercial article, that is not less than the Contractor’s good faith estimate of the greater of—
(A) An amount equivalent to 120 percent of the amount of specialty metal that is required to carry out the production of the commercial derivative military article (including the work performed under each subcontract); or
(B) An amount equivalent to 50 percent of the amount of specialty metal that will be purchased by the Contractor and its subcontractors for use during such period in the production of the commercial derivative military article and the related commercial article.
(2) For the purposes of this alternative, the amount of specialty metal that is required to carry out production of the commercial derivative military article includes specialty metal contained in any item, including COTS items.
(e) Subcontracts.
(1) The Contractor shall exclude and reserve paragraph (d) and this paragraph (e)(1) when flowing down this clause to subcontracts.
(2) The Contractor shall insert paragraphs (a) through (c) and this paragraph (e)(2) of this clause in subcontracts, including subcontracts for commercial items, that are for items containing specialty metals to ensure compliance of the end products that the Contractor will deliver to the Government. When inserting this clause in subcontracts, the Contractor shall—
(i) Modify paragraph (c)(6) of this clause only as necessary to facilitate management of the minimal content exception at the prime contract level. The minimal content exception does not apply to specialty metals contained in high-performance magnets; and
(ii) Not further alter the clause other than to identify the appropriate parties.
252.225-7052 Restriction on the Acquisition of Certain Magnets and Tungsten.
As prescribed in 225.7018-5, use the following clause:
RESTRICTION ON THE ACQUISITION OF CERTAIN MAGNETS AND TUNGSTEN (DEC 2019)
(a) Definitions. As used in this clause—
“Assembly” means an item forming a portion of a system or subsystem that—
(1) Can be provisioned and replaced as an entity; and
(2) Incorporates multiple, replaceable parts.
“Commercially available off-the-shelf item”—
(1) Means any item of supply that is—
(i) A commercial item (as defined in paragraph (1) of the definition of “commercial item” in section 2.101 of the Federal Acquisition Regulation);
(ii) Sold in substantial quantities in the commercial marketplace; and
(iii) Offered to the Government, under this contract or a subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and
(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.
“Component” means any item supplied to the Government as part of an end item or of another component.
“Covered country” means—
(1) The Democratic People’s Republic of North Korea;
(2) The People’s Republic of China;
(3) The Russian Federation; or
(4) The Islamic Republic of Iran.
“Covered material” means—
(1) Samarium-cobalt magnets;
(2) Neodymium-iron-boron magnets;
(3) Tungsten metal powder; and
(4) Tungsten heavy alloy or any finished or semi-finished component containing tungsten heavy alloy.
“Electronic device” means an item that operates by controlling the flow of electrons or other electrically charged particles in circuits, using interconnections such as resistors, inductors, capacitors, diodes, switches, transistors, or integrated circuits.
“End item” means the final production product when assembled or completed and ready for delivery under a line item of this contract.
“Subsystem” means a functional grouping of items that combine to perform a major function within an end item, such as electrical power, attitude control, and propulsion.
“Tungsten heavy alloy” means a tungsten base pseudo alloy that—
(1) Meets the specifications of ASTM B777 or SAE-AMS-T-21014 for a particular class of tungsten heavy alloy; or
(2) Contains at least 90 percent tungsten in a matrix of other metals (such as nickel-iron or nickel-copper) and has density of at least 16.5 g/cm3).
(b) Restriction.
(1) Except as provided in paragraph (c) of this clause, the Contractor shall not deliver under this contract any covered material melted or produced in any covered country, or any end item, manufactured in any covered country, that contains a covered material (10 U.S.C. 2533c).
(2)(i) For samarium-cobalt magnets and neodymium iron-boron magnets, this restriction includes—
(A) Melting samarium with cobalt to produce the samarium-cobalt alloy or melting neodymium with iron and boron to produce the neodymium-iron-boron alloy; and
(B) All subsequent phases of production of the magnets, such as powder formation, pressing, sintering or bonding, and magnetization.
(ii) The restriction on melting and producing of samarium-cobalt magnets is in addition to any applicable restrictions on melting of specialty metals if the clause at 252.225-7009, Restriction on Acquisition of Certain Articles Containing Specialty Metals, is included in the contract.
(3) For production of tungsten metal powder and tungsten heavy alloy, this restriction includes–
(i) Atomization;
(ii) Calcination and reduction into powder;
(iii) Final consolidation of non-melt derived metal powders; and
(iv) All subsequent phases of production of tungsten metal powder, tungsten heavy alloy, or any finished or semi-finished component containing tungsten heavy alloy.
(c) Exceptions. This clause does not apply—
(1) To an end item that is—
(i) A commercially available off-the-shelf item, other than—
(A) A commercially available off-the-shelf item that is 50 percent or more tungsten by weight; or
(B) A tungsten heavy alloy mill product, such as bar, billet, slab, wire, cube, sphere, block, blank, plate, or sheet, that has not been incorporated into an end item, subsystem, assembly, or component;
(ii) An electronic device, unless otherwise specified in the contract; or
(iii) A neodymium-iron-boron magnet manufactured from recycled material if the milling of the recycled material and sintering of the final magnet takes place in the United States.
(2) If the authorized agency official concerned has made a nonavailability determination, in accordance with section 225.7018-4 of the Defense Federal Acquisition Regulation Supplement, that compliant covered materials of satisfactory quality and quantity, in the required form, cannot be procured as and when needed at a reasonable price.
(i) For tungsten heavy alloy, the term “required form” refers to the form of the mill product, such as bar, billet, wire, slab, plate, or sheet, in the grade appropriate for the production of a finished end item to be delivered to the Government under this contract; or a finished component assembled into an end item to be delivered to the Government under the contract.
(ii) For samarium-cobalt magnets or neodymium-iron-boron magnets, the term “required form” refers to the form and properties of the magnets.
(d) The Contractor shall insert the substance of this clause, including this paragraph (d), in subcontracts and other contractual instruments that are for items containing a covered material, including subcontracts and other contractual instruments for commercial items, unless an exception in paragraph (c) of this clause applies. The Contractor shall not alter this clause other than to identify the appropriate parties.
(End of clause)
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