Title 22 — Foreign Relations and IntercourseRelease 119-73
§2354 Procurement
Title 22 › Chapter CHAPTER 32— - FOREIGN ASSISTANCE › Subchapter SUBCHAPTER III— - GENERAL AND ADMINISTRATIVE PROVISIONS › Part Part I— - General Provisions › § 2354
Summary
The President must use funds for buying goods and services mostly in the United States, in the country getting the aid, or in developing countries. Buying in other countries is allowed only if the needed items are not made or sold in those places, or if the President decides case-by-case that buying elsewhere is needed to handle an emergency or to use aid money more efficiently without hurting program goals. For this rule, “developing countries” does not include advanced developing countries. The law also says prices for bulk purchases must not be higher than U.S. market prices at the time, after adjusting for shipping, quality, and payment terms. Food available under the Food for Peace Act should be bought in the United States when possible, unless there is not enough for emergency needs. When U.S. commodities are bought, dollars can pay for marine insurance placed competitively under pre–World War II trade practice; if a recipient country blocks U.S.-authorized insurers, the shipment must be insured in the U.S. No funds may buy U.S. agricultural items abroad when the domestic price is below parity unless U.S. supply cannot meet the program. Suppliers in commodity import programs must give required certification and get agency approval before payment. Funds cannot be used to buy construction or engineering services from advanced developing countries listed under Geographic Code 941 that are competitive internationally, unless that country is getting direct U.S. economic help under specified parts and allows U.S. firms to compete in its programs.
Full Legal Text
Title 22, §2354
Foreign Relations and Intercourse — Source: USLM XML via OLRC
(a)(1)Funds made available for assistance under this chapter may be used by the President for procurement—
(A)only in the United States, the recipient country, or developing countries; or
(B)in any other country but only if—
(i)the provision of such assistance requires commodities or services of a type that are not produced in and available for purchase in any country specified in subparagraph (A); or
(ii)the President determines, on a case-by-case basis, that procurement in such other country is necessary—
(I)to meet unforeseen circumstances, such as emergency situations, where it is important to permit procurement in a country not specified in subparagraph (A); or
(II)to promote efficiency in the use of United States foreign assistance resources, including to avoid impairment of foreign assistance objectives.
(2)For purposes of this subsection, the term “developing countries” shall not include advanced developing countries.
(b)No funds made available under this chapter shall be used for the purchase in bulk of any commodities at prices higher than the market price prevailing in the United States at the time of purchase, adjusted for differences in the cost of transportation to destination, quality, and terms of payment.
(c)In providing for the procurement of any agricultural commodity or product thereof available for disposition under the Food for Peace Act, as amended [7 U.S.C. 1691 et seq.], for transfer by grant under this chapter to any recipient country in accordance with its requirements, the President shall, insofar as practicable and when in furtherance of the purposes of this chapter, authorize the procurement of such agricultural commodity only within the United States except to the extent that such agricultural commodity is not available in the United States in sufficient quantities to supply emergency requirements of recipients under this chapter.
(d)In providing assistance in the procurement of commodities in the United States, United States dollars shall be made available for marine insurance on such commodities where such insurance is placed on a competitive basis in accordance with normal trade practice prevailing prior to the outbreak of World War II: Provided, That in the event a participating country, by statute, decree, rule, or regulation, discriminates against any marine insurance company authorized to do business in any State of the United States, then commodities purchased with funds provided hereunder and destined for such country shall be insured in the United States against marine risk with a company or companies authorized to do a marine insurance business in any State of the United States.
(e)No funds made available under this chapter shall be used for the procurement of any agricultural commodity or product thereof outside the United States when the domestic price of such commodity is less than parity, unless the commodity to be financed could not reasonably be procured in the United States in fulfillment of the objectives of a particular assistance program under which such commodity procurement is to be financed.
(f)No funds authorized to be made available to carry out subchapter I of this chapter shall be used under any commodity import program to make any payment to a supplier unless the supplier has certified to the agency primarily responsible for administering such subchapter I, such information as such agency shall by regulation prescribe, including but not limited to, a description of the commodity supplied by him and its condition, and, on the basis of such information such agency shall have approved such commodity as eligible and suitable for financing under this chapter.
(g)(1)None of the funds authorized to be appropriated or made available for obligation or expenditure under this chapter may be made available for the procurement of construction or engineering services from advanced developing countries, eligible under the Geographic Code 941, which have attained a competitive capability in international markets for construction services or engineering services.
(2)Paragraph (1) does not apply with respect to an advanced developing country which—
(A)is receiving direct economic assistance under part I of subchapter I of this chapter or part IV of subchapter II of this chapter, and
(B)if the country has its own foreign assistance programs which finance the procurement of construction or engineering services, permits United States firms to compete for those services.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
References in Text
This chapter, referred to in subsecs. (a) to (c) and (e) to (g)(1), was in the original “this Act”, meaning Pub. L. 87–195, Sept. 4, 1961, 75 Stat. 424, known as the Foreign Assistance Act of 1961. For complete classification of this Act to the Code, see
Short Title
note set out under section 2151 of this title and Tables. The Food for Peace Act, as amended, referred to in subsec. (c), is act July 10, 1954, ch. 469, 68 Stat. 454, which is classified principally to chapter 41 (§ 1691 et seq.) of Title 7, Agriculture. For complete classification of this Act to the Code, see
Short Title
note set out under section 1691 of Title 7 and Tables.
Amendments
2008—Subsec. (c). Pub. L. 110–246 substituted “Food for Peace Act” for “Agricultural Trade Development and Assistance Act of 1954”. 1992—Subsec. (a). Pub. L. 102–391 amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “Funds made available under this chapter may be used for procurement outside the United States only if the President determines that such procurement will not result in adverse effects upon the economy of the United States or the industrial mobilization base, with special reference to any areas of labor surplus or to the net position of the United States in its balance of payments with the rest of the world, which outweigh the economic or other advantages to the United States of less costly procurement outside the United States, and only if the price of any commodity procured in bulk is lower than the market price prevailing in the United States at the time of procurement, adjusted for differences in the cost of transportation to destination, quality, and terms of payment.” 1985—Subsec. (g). Pub. L. 99–83 designated existing provisions as par. (1) and added par. (2). 1980—Subsec. (e). Pub. L. 96–533, § 705(a), authorized use of funds for procurement of a commodity outside the United States when the commodity to be financed could not reasonably be procured in the United States in fulfillment of objectives of a particular assistance program under which such commodity procurement is to be financed. Subsec. (g). Pub. L. 96–533, § 705(b), added subsec. (g). 1968—Subsec. (f). Pub. L. 90–554 added subsec. (f). 1966—Subsec. (c). Pub. L. 89–583, § 301(b)(1), struck out “surplus” before “agricultural commodity” in three places and inserted “or products thereof available for disposition under the Agricultural Trade Development and Assistance Act of 1954, as amended,” after “commodity” where first appearing. Subsec. (e). Pub. L. 89–583, § 301(b)(2), added subsec. (e).
Statutory Notes and Related Subsidiaries
References to Subchapter I Deemed To Include Certain Parts of Subchapter IIReferences to subchapter I of this chapter are deemed to include parts IV (§ 2346 et seq.), VI (§ 2348 et seq.), and VIII (§ 2349aa et seq.) of subchapter II of this chapter, and references to subchapter II are deemed to exclude such parts. See section 202(b) of Pub. L. 92–226, set out as a note under section 2346 of this title, and section 2348c and 2349aa–5 of this title. References to Part I Deemed To Include section 2293References to part I of subchapter I of this chapter are deemed to include a reference to section 2293 of this title. See section 2293(d)(1) of this title.
Effective Date
of 2008 AmendmentAmendment by Pub. L. 110–246 effective May 22, 2008, see section 4(b) of Pub. L. 110–246, set out as an
Effective Date
note under section 8701 of Title 7, Agriculture.
Effective Date
of 1985 AmendmentAmendment by Pub. L. 99–83 effective Oct. 1, 1985, see section 1301 of Pub. L. 99–83, set out as a note under section 2151–1 of this title.
Executive Documents
Delegation of Functions For delegation of functions of President under this section, see Ex. Ord. No. 12163, Sept. 29, 1979, 44 F.R. 56673, as amended, set out as a note under section 2381 of this title.
Reference
Citations & Metadata
Citation
22 U.S.C. § 2354
Title 22 — Foreign Relations and Intercourse
Last Updated
Apr 6, 2026
Release point: 119-73