An adverse inference is a penalty that the Small Business Administration (SBA) can enforce as part of a size protest. During a size protest determination, SBA will ask the protested company lots of questions. Sometimes, a protester will not answer those questions, either on purpose or due to oversight. Depending on the circumstances, SBA can apply an adverse inference if a protested company fails to respond to questions. If SBA applies an adverse inference, that means that the SBA Area Office will determine that the information that was not provided would prove that the company is not a small business. A recent decision reminds us about this penalty. If you are in a similar situation, reach out to a firm like ours to help think of a way to respond to SBA.
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OHA: Respond to SBA Size Determination Questions, or Risk an Adverse Inference
SBA’s size protest rules contain a stick to force companies to respond to SBA as part of size determination. That stick is called the adverse inference rule. The adverse inference rule says that, if SBA requests specific information and a protested company refuses to provide it, SBA may assume that the missing information would show that the company is not a small business. In a recent decision, SBA’s Office of Hearings and Appeals (OHA) upheld the use of the adverse inference.
Continue readingBusy Employee “Skims” SBA Size Protest Email–What Could Go Wrong?
A contractor’s “frantically busy” employee, who was listed as the firm’s contact in SAM, skimmed through an email from the SBA containing a size protest, and took no action to respond.
In a recent size appeal decision, the SBA Office of Hearings and Appeals held that the SBA had properly issued an adverse size determination against the contractor in question after receiving no reply to the size protest–and the fact that the employee who received it was “frantically busy” was no excuse.
Late SBA Size Protest Response Sinks Contractor’s Small Business Eligibility
No matter a company’s actual size, the company will be deemed an ineligible large business if it fails to timely respond to a SBA size protest.
Just ask American Blanching Company, which was recently found ineligible for a small business set-aside contract because it did not respond to a SBA size protest within the short size protest response window.
SBA OHA Decides First EDWOSB Eligibility Appeal
My daughter is learning to take her first steps, while holding onto the furniture. Yesterday, she started pushing her stroller around the living room, essentially using it as a walker. My wife and I looked at each other and said something like, “things are about to get really interesting around here.”
Things are also about to get interesting when it comes to the women-owned small business program, and its subset, the economically disadvantaged women-owned small business program. Ever since the WOSB program formally came into being last year, I’ve been saying that it was only a matter of time before WOSBs and EDWOSBs started protesting one another’s eligibility for WOSB and EDWOSB set-aside procurements.
Now, the SBA Office of Hearings and Appeals has ruled on its first WOSB appeal. What happened? Well, for one, all WOSBs should make sure their facsimile machines are in good working order before submitting another bid.