Energy projects limit role of foreign firms' U.S. units

The Energy Department is preventing U.S. subsidiaries of foreign corporations from full participation in a $400 million program designed to develop “transformational” technologies.

Affected companies including giants such as Siemens and Philips complain that the policy exceeds the requirements of the “Buy America” provision of this year’s stimulus legislation. They say it will deprive the effort to achieve energy and environmental breakthroughs of unique scientific expertise and will discourage the creation of jobs at the foreign-owned U.S. facilities.

“The definition of an American company is not the same today as it was 50 years ago. If the administration makes decisions based on outdated views, they’re not doing all they can to generate jobs now,” says Nancy McLernon, president of the Organization for International Investment, which represents the foreign-owned companies.

The dispute, which has simmered for months, highlights the difficulties of administering “Buy America” provisions intended to benefit some American workers without harming other Americans. According to OFII, foreign-owned companies employ more than 5.5 million people in the U.S.

Under the stimulus bill, the administration set aside $400 million for the Advanced Research Projects Agency-Energy program. An April 27 notice said “foreign entities” could not head project teams and were limited to receiving 25% of any contract.

USA Today