Reminder: No Ostensible Subcontractor Protests At GAO

The GAO lacks jurisdiction to consider a challenge to a contract awardee’s size status, including questions of whether the awardee is affiliated with its subcontractor under the ostensible subcontractor rule.

In a recent bid protest decision, the GAO confirmed that it will not adjudicate an allegation of ostensible subcontractor affiliation.

The GAO’s decision in Archimania, B-414653 (Aug. 3, 2017), involved a GSA solicitation seeking architect-engineer services for the design of a new courthouse in Greenville, Mississippi.  The solicitation was issued as a small business set-aside.

After evaluating offerors under both stages of the two-phase competition, the GSA awarded the contract to Duvall Decker, which had teamed with Eskew+Demez+Ripple.  Although Duvall Decker was a small business, EDR was not.

Archimania, an unsuccessful competitor, filed a GAO bid protest challenging the award to Duvall Decker.  Among its arguments, Archimania contended that Duvall Decker was affiliated with EDR under the ostensible subcontractor affiliation rule, and therefore was ineligible for award.

GAO wrote that “[t]he Small Business Act . . . gives the SBA, not our Office, the conclusive authority to determine matters of small business size status for federal procurements.”  GAO refused to consider the argument, writing, “[w]e therefore will not review a protester’s challenge to another company’s size status, or a decision by the SBA that a company is, or is not, a small business.”

The GAO denied the protest.

As the Archimania case demonstrates, the GAO lacks authority to adjudicate size protests, including protests under the ostensible subcontractor rule.  Issues of small business size eligibility fall within the SBA’s exclusive jurisdiction, and protesters must use the SBA’s size protest process to challenge a competitor’s size.