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and will serve to store the bottles until they are sent to
Here, the article needed by the United States is the drug sulfadiazine prepared in a tablet form to be used as a medicine for human consumption. The bottling and packaging functions, as well as the materials used in connection therewith, to be performed by Chase would provide merely a convenient means for shipping, distributing and storing the tablets until removed from the bottle and administered to patients. Chase would not add anything to the tablet or change its physical appearance or characteristics, nor would any of the materials used by that firm constitute a part of an integrated unit for the accomplishment of the intended medical purpose. We feel that the legislative history of the act requires the conclusion that the process of packaging or packing previously manufactured end articles to be used by the Government, or the placing of such articles into storage containers which do not serve a special function in the actual use of the article by the Government, should not be regarded as an additional "manufacturing'' process so as to remove an otherwise foreign end product from the restrictions of the act. On February 3, 1933, as appears in 76 Cong. Rec. 3267, the Senate considered an amendment which would have omitted the provision that articles manufactured in the United States be substantially all from materials or articles which likewise had been produced or manufactured in the United States. In commenting on the suggested amendment, Senator Hiram W. Johnson, the sponsor of the provision, made the following statement and illustration:
From my standpoint, the vice of his amendment is that
For instance, as I have repeatedly stated upon the
It is clearly evident from the above illustration that if a subsequent packing of the assembled turbines or generating machinery in containers, for shipping to and storing at the dam site until such equipment could be installed to perform its planned purpose, was regarded as constituting an additional "manufacture" of such equipment, the desired effect of the provision as intended by the Congress would be defeated.
The Buy American Act clause incorporated into the RFP (ASPR 6-104.5) defines 'end products" as "those articles, materials, and supplies which are to be acquired under this contract for public use." (Italic supplied.] In stating a similar definition for end products, ASPR 6-001(a) further provides that as to a given contract "the end products are the items delivered to the Government, as specified in the contract * * * ." In a reduction of such provision from its plural terms to the singular form it would state that as to a given contract the end product is the item to be delivered to the Government, as specified in the contract. Thus, consistent with the above stated views, we believe proper administration of the act requires that the end product in a contract containing the above Buy American Act clause be regarded as the basic item to be delivered to the Government for actual use by the United States, exclusive of packaging materials or containers serving only to effect delivery of the item in the manner as specified in the contract and which have no function in the ultimate use of the item.
In view of the foregoing we must conclude that the essential need of the Government was for sulfadiazine tablets, not bottles, and that Chase would not have been a manufacturer, within the contemplation of the Buy American Act, of the required product (sulfadiazine tablets). The tablets, being foreign articles under the act, could not be transformed into American items by being put into American bottles. Your proposal was therefore properly determined by the Defense Supply Agency to be subject to the restrictions of that act. In this connection, and with reference to the manufacture of drugs generally, it is noted that the Bureau of Enforcement, Department of Health, Education, and Welfare, Food and Drug Administration, issued a Guideline, BE-103, on November 7, 1962, for enforcement of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. 301, stating in part:
We believe that a person or firm that purchases tablets or
i Distributed by ' or other similar phrase which
To the extent that 43 Comp. Gen. 306, and subsequent decisions based thereon, may be contrary to the position here stated, they are hereby overruled.
The record in this case consists of a notice of appeal, a letter from the contracting officer to the Board, including a copy of a prior letter to appellant, and the pleadings. No copy of the contract or other Rule 4 papers have been filed and appellant has not been asked if it desires a hearing. However, under the circumstances outlined below, neither further documentation nor a hearing are considered necessary to the disposition presently being made of the appeal.
The contracting officer's letter states, inter alia:
"3. The matter being appealed by the Contractor evolves
"4. No final decision of the Contracting Officer has
Attached to the contracting officer's letter is a copy of a letter from the Government to appellant, Subject: MEMORANDUM OF DECISION - Request of Kleen-Rite Janitorial Service, Inc. for Contractual Adjustment under Public Law 85-804 - Contract AF 38 (601) - 3614. The request for relief was denied.
The complaint makes the following allegations:
On or about July 1, 1966, appellant entered into a contract with the United States of America by its contracting officer, Virgil V. Carlsen, pursuant to which appellant agreed to perform custodial services at Shaw Air Force Base, South Carolina for a period of one year at a total contract price of $72,228.00.
12. The agreed contract price was premised upon payment
"3. Appellant fully and ably performed its obligations
On or about February 1, 1967, a raise from the
"5. On or about January 12, 1967 and February 17, 1967,
"6. On or about March 7, 1967, appellant received corre-
"7. On or about March 7, 1967, appellant received from
"8. Appellant respectfully submits that it has and is
The answer admits all of the allegations of the complaint except numbers 2 and 8. The answer also states:
"2. The Respondent denies paragraph 2 of the Appellant's
"3. The Respondent denies that such loss as Appellant
"4. Appellant's petitions for increase in contract price
"5. Since the Contractor is not appealing from a
"6. Therefore, the Respondent submits the appeal should
Our reading of appellant's complaint is that it is asking this Board to overrule a decision previously made under Public Law 85-804 and Section XVII of the Armed Services Procurement Regulation. Paragraph 8 of the complaint uses language similar to that found in ASPR 17-204.2(b), Amendments Without Consideration, quoted in the letter to appellant advising of the denial of its request. Based on that understanding we must dismiss the appeal. This Board has not been delegated any authority to decide cases under P.L. 85-804.
We note, however, that in denying allegation No. 2 of the complaint, the Government went on to allege: "The subject contract did not contain any escalation clause. We do not read allegation No. 2 as stating that there was any such clause in the contract. We assume appellant is alleging no more than the fact that it or both parties based the contract price upon an expectation that the employees would be paid in accordance with the old minimum wage rate. If appellant is alleging that the contract price was arrived at as the result of a mistaken belief that the old wage rate would continue and contends that the particular set of facts warrants relief for such a mistake, then that type of relief is also beyond our jurisdiction. That, too, would be a matter for decision by officials authorized to act under P.L. 85-804 or by the Comptroller General or the Courts.
But if appellant is contending that there was a contract provision that expressly or impliedly did provide for an adjustment in price on accout of a minimum wage increase, then we make no decision on that issue. If there is such an issue, or if appellant considers that, on any other ground, relief can be granted pursuant to the terms of the contract, then to that extent the appeal is remanded to the parties for further consideration and, if needed, for a decision under the Disputes clause.
We think it appropriate, however, to call to appellant's attention our decision in L. J. Whitfield Co. and Alarida Construction Co., Inc., ASBCA No. 8156, 1962 BCA 4 3570, as follows:
"In ASBCA No. 8156 appellant simply seeks the additional amount of wages, alleged to be $6,079.84,