Federal contractors often ask: “It is better to team up for government work with a prime-sub arrangement or with a joint venture?” Well, (spoiler alert) the answer is: it depends. But I won’t leave you with just that. This three-part series will provide insight on some of the major differences between these two types of “teams” that offerors should consider when making the decision between a joint venture or prime/subcontractor team in competing for and performing federal contracts. While this series will not provide a comprehensive list of all the differences between these two types of teams, it will cover some of the big ones that seem to come up more frequently in this decision-making process. Our first article focused on workshare, and our second, on past performance. This final article of the three-part series will discuss the parties’ relationship with the government and with each other in both types of teams.
Continue readingTag Archives: joint venture agreements
If You Plan to Use the SBA’s Template Joint Venture Agreement, Read This First
If you’re setting up your first joint venture under the SBA’s rules, you may be tempted to download the SBA’s template joint venture agreement and use it as-is.
But, as of the date of this post, the SBA’s template joint venture agreement is outdated–and it also has some other quirks and potential problems you should know about. If you’re planning to use the SBA’s joint venture template, read this first.
Continue readingSBA’s Change to Joint Venture Bank Account Rule is Another Trap for the Unwary
If you are part of a joint venture between a small protege and its large mentor under the SBA’s Mentor-Protege Program, heads up: the SBA recently amended its list of mandatory requirements for joint venture agreements to cover what happens to funds left over in the joint venture bank account at the end of a project.
Like the revised recordkeeping rules I discussed in an earlier post, the new required provision only applies to mentor-protege joint ventures pursuing small business set-aside contracts–not to JVs seeking 8(a), SDVOSB/VOSB, WOSB/EDWOSB or HUBZone work. Confusingly (and again, like the recordkeeping rules), SBA’s decision to change only the small business set-aside regulation, 13 C.F.R 125.8, means that the same joint venture agreement may not be valid for both small business set-aside contracts and socioeconomic contracts.
Continue readingKoprince Law Discusses Teaming for Federal Contractors on Contracting Officer Podcast
I’m excited to announce that I am featured on the Contracting Officer Podcast, hosted by Kevin Jans and Paul Schauer! The episode is available here (Apple podcast here) and, in it, I discuss three common forms of contractor relationships: Teaming Agreements, Joint Venture Agreements, and the federal Mentor-Protégé Program. Be sure to check out this episode and the plethora of other podcast topics, helpful to both beginning and experienced federal contractors.
8(a) Joint Venture Fraud Allegations Lead to False Claims Act Settlement
The SBA’s joint venture rules can be strict. Mistakes like failing to update a joint venture agreement, inserting ambiguous provisions in a joint venture agreement, or relying on an expired mentor-protege agreement can be costly.
Good faith mistakes are one thing–the joint venture may lose out on a contract, but probably won’t face other penalties. But when the government believes that a contractor knowingly violated the joint venture rules, the repercussions can be much more serious–as seen in a recent False Claims Act settlement involving allegations of fraud under the 8(a) joint venture regulations.
Continue readingCheck Your Joint Venture Agreements: Under-the-Radar SBA Change Could Cause Problems
Joint ventures operating under the SBA’s All Small Mentor-Protege Program may need to adjust their joint venture agreements because of a little-noticed change to SBA’s joint venture rules.
In its recent final rule, effective November 16, SBA amended two of the mandatory requirements for mentor-protege joint ventures pursuing small business set-aside contracts. SBA did not make corresponding changes to the joint venture rules for SBA’s four major socioeconomic programs–meaning that a joint venture agreement that complies with the small business set-aside rules may not be valid if the joint venture pursues 8(a), SDVOSB/VOSB, HUBZone or WOSB/EDWOSB contracts (and vice versa).
Continue readingCongress Says Small Businesses Without Past Performance Can Submit Joint Venture Experience Instead
Per the 2021 NDAA that was recently approved by Congress, small business offerors without their own past performance experience can now submit experience earned as part of a joint venture–and the procuring agency must consider it. This change will significantly benefit newer companies that do not yet have the individual experience to successfully compete for government contracts (that is, assuming the President signs the NDAA). It will also add an incentive for start-up companies to take advantage of SBA’s joint venture opportunities.
Continue reading