SBA Affiliation Rules: Beware Supermajority Voting Requirements

Under the SBA’s affiliation rules, a minority owner may “control” a company where the company’s governing documents impose supermajority voting requirements that require the minority owner’s consent for the company to make ordinary business decisions.

In a recent size appeal decision, the SBA Office of Hearings and Appeals confirmed that supermajority voting requirements may establish control (and affiliation), even where the minority owner does not actually exercise its control.

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Joint Ventures And GAO Protests: Protester Must Have “Standing”

For a member of a joint venture to file a GAO bid protest on behalf of the joint venture, the member must have the authority to do so.  If a JV Member’s authority to act is in question, the GAO will dismiss the protest for lack of standing.

In a recent decision, the GAO dismissed a bid protest filed by a joint venture member because the other joint venture member disputed the protester’s right to act on the joint venture’s behalf.

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