TAA stands for Trade Agreement Act, which enables fair and honest international trade and thus requires the U.S. Government to only acquire products, such as office furniture, from suppliers sourcing components from designated countries. It limits the U.S. Government procurement to either US-made products, or a portion of the product components made in countries designated by the TAA. Such products are then called “TAA compliant”. If you supply products for government contracts (GSA Supply Schedules), those products must thus comply with the federal Trade Agreements Act (TAA).
A product is TAA compliant if:
- At least 50% of its overall manufacturing cost originates from the U.S. or designated countries.
- The product has undergone substantial transformation in the U.S. or designated countries.
The idea behind the term “substantially transformed” is that the product must go through certain significant changes (manufacturing, assembly, processing etc.) that result in distinctive character, name, or use of the emerged new product. So, a “substantially transformed” product is considered originating from the country where those transformations were made.
For instance, suppose you have an assembly facility in the U.S. that manufactures a product, such as office task chairs, consisting of three parts:
- Part A makes up 25% of the cost and comes from Canada.
- Part B makes up 40% of the cost and is imported from Taiwan.
- Part C makes up 15% of the cost and comes from China.
- And the labor makes up 20% of manufacturing costs.
Since only 15% of the cost originates from non TAA compliant country (China), the product is substantially transformed in the U.S. and designated countries, so it is TAA compliant.
However, if the Part B supplier changed to China components as well, 55% of the product cost will emerge from non-designated countries which essentially renders those task chairs or conference chairs non TAA compliant.
In conclusion, the TAA requirements not only ensures a certain level of product quality, but is also very beneficial for the country.
Office furniture, chairs and file cabinets sold to the Federal Government must therefore be “substantially transformed” in the United States or in TAA designated countries, including nations that currently have free trade agreements with the United States.
For CA Office Design, TAA Compliance means that we only source from reputable manufacturers that show documentation that they are compliant with the TAA. This ensures not only that our ranges are TAA compliant but gives you confidence that our office furniture ranges are of a higher and lasting quality. It’s also a clear way to differentiate our ranges from the competition. For a detailed listing of all products we support, please see our Chair and File TAA Compliance Pricer.
Feel free to contact us for a free space planning and design consultation to help you determine your office furniture requirements.
CA Office Design is the leading space planner in Southern California and specializes in office furniture relocating and expansion. We pride ourselves on designing ergonomic office and cubicle layouts, as well as manufacturing and installation of the furniture.
CA Office Design encourages as much collaboration as possible whilst still creating privacy where necessary – especially during the COVID-19 Pandemic. Designing spaces with color, light, collaboration and a level of privacy in mind, employee conditions can be enhanced to ensure not only their safety, but also improved productivity.
Our ranges cover new office furniture, filling cabinets, chairs and cubicles.