Press Release - Berry Amendment

Berry Amendment Implications for Samarium Cobalt Magnets and Magnet Systems (DFARS)

Landisville, PA — Electron Energy Corporation has recently received requests to provide certification of full compliance with DFARS clause 252.225.7014 Alt. 1 Preference for Domestic Specialty Metals. This is the specific mechanism in the Defense Federal Acquisitions Regulations Supplement by which “domestic source restrictions” are implemented by the Department of Defense. US law and its revisions known as the Berry Amendment enact “domestic source restrictions” provisions for national defense.

Violations of the Berry Amendment specialty metals clauses have resulted in major fines and penalties, government investigations and delayed deliveries to DOD. This impacts all tiers in the supply chain to DOD. We know that DOD and prime contractors are making a concerted effort to ensure that these provisions are flowed down to suppliers at all levels. EEC wishes to support those efforts. We assure you that all EEC orders for magnets and magnet systems with a stated end use by the US Department of Defense are produced in compliance to US law Berry Amendment provisions enacted in DFARS.

Production of rare earth permanent magnets, assemblies and magnet systems, involves specialty metals that fall under the DFARS clause 252.225.7014 Alt 1. These specialty metals typically include all samarium cobalt magnets, titanium, and many stainless steels used in magnet assemblies supplied by EEC. DFARS clause 252.225.7014 Alt. 1 is invoked by all DOD contracts for equipment requiring delivery of articles that contain specialty metals. There are exceptions to applying DFARS clause 252.225-7014 Alt 1 in DOD procurements, however, they generally are not relevant in programs or development efforts where magnets and magnet systems are used.

(Specialty metals are defined as: steel (see DFARS for specific alloy content percentages), titanium and titanium alloys, zirconium and zirconium alloys, nickel, iron-nickel and cobalt base alloys with more than 10% of other alloying metals (except iron). DFARS requires that any article containing a specialty metal, must use specialty metals melted in the U.S., a U.S. possession, Puerto Rico or qualifying country.)