SBA is currently considering terminating some class waivers for its small business Nonmanufacturer Rule, as it has received information to established the existence of small business manufacturers of
the subject products.
As January 5, 2022, SBA will no longer use Product Service Codes (PSCs) to classify products covered by class waivers for the nonmanufacturer rule. SBA’s rationale for discontinuing PSC’s to classify class waivers is to “improve consistency in the application of class waiver.” SBA will use North American Industry Classification System codes (NAICS) as its sole classification system to identify products covered by class waivers going forward. Notification of the change of SBA’s rule was published in the Federal Register on December 6, 2021.Continue reading
The SBA said recently that it intends to issue a class waiver of the Nonmanufacturer Rule for laptop and tablet computers, freeing up small businesses to resell these products in bulk to the federal government.
The SBA recently announced its intent in the Federal Register, giving the public the opportunity to comment early in the New Year.Continue reading
Last month, Steve wrote about a new Class Deviation rule adopted by the VA that, in effect, would limit the VA’s use of class waivers as part of its decision to restrict competition to SDVOSBs (or otherwise issue solicitations as sole source awards). But in an apparent contradiction to this Class Deviation rule, GAO recently denied a challenge to an SDVOSB set-aside decision for a manufacturing solicitation, based in large part on SBA’s adoption of a class waiver for the particular NAICS code.
The VA has adopted a Class Deviation to the VAAR, severely restricting the ability of VA Contracting Officers to request waivers of the nonmanufacturer rule–and, even more troubling, suggesting that Contracting Officers need not apply the statutory SDVOSB and VOSB preferences even when the SBA has already granted a class waiver.
You may be wondering “does the VA’s Class Deviation comply with Kingdomware?” Good question.
Under the nonmanufacturer rule, a class waiver applies to a procurement only if the NAICS code, Product Service Code and NAICS code descriptor match the item being procured.
Contrary to a common misconception, a nonmanufacturer rule class waiver is not authorized on the basis of the NAICS code alone. In a recent size appeal decision, the SBA Office of Hearings and Appeals concisely explained how nonmanufacturer rule class waivers work.