Olga Wall is the President of Avallon LLC, a woman-owned small business.

Disclaimer: This article was submitted to WorkwithUSAID.org as a guest blog post. The views expressed by WorkwithUSAID.org guest blog contributors do not necessarily reflect the views of the United States Agency for International Development or the United States Government. 

Geographic code applies to procurement of goods and services paid for with USAID funds. For assistance agreements, which are the focus of this blog post, geographic code applies to the procurements carried out by recipients and subrecipients under USAID grants and cooperative agreements.  

1. What is a “geographic code”?

Each USAID implementation instrument specifies a USAID three-digit geographic code. Each code represents those countries where goods must be located at the time of purchase and where companies that sell those goods or services must be legally organized and operational.  

Main Code 937 includes the United States, the recipient country, and developing countries.  Current “developing countries” are listed here: List of Developing Countries ADS 310. 

Code 935 means free world and includes all countries except prohibited sources countries. There are no prohibited source countries at the moment. 

Code 110 means newly independent states of the former Soviet Union (an outdated description) and any developing country (see above).

2. What does geographic code mean?

Each geographic code governs “source” (of goods) and “nationality” (of supplier/company).

See 22 CFR 228 for complete definitions. 

Source means the country from which a commodity is shipped to the cooperating/recipient country or the cooperating/recipient country itself if the commodity is located therein at the time of the purchase, irrespective of the place of manufacture or production, unless it is a prohibited source country. 

Nationality refers to the place of legal organization, ownership, citizenship, or lawful permanent residence of companies which are supplying the commodities and services. 

3. When and how does a geographic code apply under USAID assistance awards?

USAID Direct Grants and Cooperative Agreements (Assistance Agreements): Prime recipients are not subject to geographic codes, unless specifically noted in the notice of funding opportunity (NOFO).

Subawards (Subgrants) under Prime USAID Assistance Agreements: Subrecipients (as defined in 2 CFR 200) are not subject to geographic code restrictions, unless specifically noted in the NOFO.

Contracts (Procurement Contracts) under Prime USAID Assistance Agreements: If the prime assistance instrument contains a geographic code, it applies to procurement of goods or services in the same way as it applies to procurement of goods or services under prime contracts.  

Responsibility to verify: USAID prime recipients are responsible for verifying eligibility of their contractors and vendors as part of their procurement procedures. 

4. What are the exceptions to the application of geographic code?

• Foreign government-controlled organizations 
• Construction procurement with foreign-owned local firms
• Miscellaneous transactions

5. Does geographic code’s “nationality” apply to employees/consultants of USAID recipients?

No, geographic code does not apply to the employees of recipients or subrecipients nor to individual/independent consultants.

6. Are there any special rules which apply to commodities and services procured by USAID recipients and subrecipients?

Yes, the following items have special approval requirements and rules:

• Pharmaceuticals
• Agricultural commodities and products 
• Pesticides 
• Used equipment
• Fertilizers 
• Motor vehicles

The following commodities and services may never be financed with USAID funds:

• Military equipment
• Surveillance equipment
• Commodities and services for support of police and other law enforcement activities
• Abortion equipment and services
• Luxury goods
• Gambling equipment
• Weather modification equipment
• Certain information technology (IT) services/equipment (Kaspersky Lab, Huawei) 

7. Can a waiver of geographic code be obtained?

USAID may grant a waiver to a prime recipient to purchase goods or services from a company which does not meet the geographic code. 

Any individual transaction not exceeding $25,000 (excluding prohibited countries or goods) does not require a waiver and is authorized for all. 

Additional resources:  

• ADS 260
• ADS 303
• ADS 312
• 2 CFR 200
• 22 CFR 228
• Frequently Asked Questions