When contractors think of protests or litigation related to federal contracting, likely their thoughts go to a bid protest or a size protest. Additionally, when thinking of protesting prior to bids being due, the focus generally is on the wording and provisions of a solicitation. However, contractors should not forget how powerful a tool a NAICS code appeal could be for small business procurements. A recent brief decision in a NAICS code appeal serves as reminder of how useful a simple NAICS code appeal can be for contractors.

In order to discuss the recent SBA OHA decision, a quick refresher on NAICS and NAICS code appeals is needed (for a more in depth discussion of NAICS code appeals, check out the NAICS Code Appeal entry in our Why File series).

A NAICS code is a six-digit code that is assigned to various categories of industries under the North American Industry Classification System (hence, NAICS), a standard used in classifying business establishments. The SBA assigns a different size standard to each NAICS code based on dollar number of receipts or number of employees. SBA publishes and regularly updates a table of all the size standards assigned to NAICS codes. Agencies must assign a NAICS code to a procurement based on the type of work involved and to establish the business size limit for the contract (if set-aside for small business or a small business certification).

Contractors can file a NAICS code appeal with SBA’s Office of Hearings and Appeals (OHA) within 10 days of a solicitation being posted (or an amendment to a solicitation affecting the NAICS code). These can be filed for a multitude of reasons, but generally, a NAICS code appeal is filed because the NAICS assigned to a solicitation simply does not make sense with the work called for in the solicitation. There are also strategic concepts behind NAICS appeals which would advantage a contractor, such as restricting the pool of offerors, or shifting the NAICS to one which a contractor can bid under as small (reminder, check out our entry on NAICS Code Appeals in the Why File series)

NAICS code appeals are quite rare, but historically, NAICS code appeals can be relatively successful compared to other federal contracting protests or litigation. GAO stated in 2017 that “in calendar years 2014–2016, OHA dismissed 35, denied 15, and granted 12.” This means a good amount were straight out successes for the appealing contractor during that time, and as you will see below, not all dismissals truly mean the appellant didn’t get the desired outcome.

In the recent NAICS code appeal of CueBid Technologies, SBA No. NAICS-6339, 2025 WL 754045 (March 5, 2025), contractors are reminded of just how swift and powerful a NAICS code appeal can be. The subject solicitation involved “hauling and transportation services, forklift/crane operations, fuel, and labor to move containerized and non-containerized military equipment within Fort Cavazos.” It was set aside for SDVOSBs and included NAICS code 532490 (Other Commercial and Industrial Machinery and Equipment Rental and Leasing) which had a size standard of $40 million. CueBid Technologies in its appeal argued that NAICS code 484110 (General Freight Trucking, Local) with its $30 million size standard, would be a better fit.

Now, most contractors would expect a drawn out briefing process and litigation as the next step. However, the agency went ahead and changed the Solicitation’s NAICS to the one argued by CueBid Technologies. Thus, SBA OHA dismissed the appeal before it was completed, since it made the appeal moot (i.e., irrelevant). This highlights just how effective a good NAICS code appeal can be. While the SBA filing resulted in a dismissal, it is a successful dismissal from the contractor’s perspective because the agency took the action sought by the appellant contractor.

Reading between the lines of this brief decision from SBA OHA, there are some great takeaways and reminders. It appears that a well formed, logical NAICS code appeal can still result in a “victory” for the contractor. Here, the agency acted before the end of the appeal to adjust the NAICS code. Presumably, the appeal filed by CueBid exhibited how its suggested NAICS code better fit the work under the Solicitation. The agency, rather than going through lengthy briefings and legal battles, simply took action after realizing CueBid’s strong position. This appeal led to an efficient, quick, and logical conclusion. This shows that a NAICS code appeal can be quite an effective tool for contractors, and efficient for the government as well. While rare, NAICS code appeals are still a powerful tool in a federal government contractor’s toolbox.

If you find yourself looking at a newly posted solicitation and feel puzzled about the assigned NAICS, do not hesitate to consider a NAICS code appeal. While rare, these are often quite powerful tools for contractors, leading to effective and efficient conclusions. Of course, each case is unique and there are legal nuances to any NAICS code appeal. So, be sure to reach out to a federal contracting attorney, such as ourselves, if you feel a NAICS code appeal may be needed.

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