The 2017 National Defense Authorization Act will require the GAO to issue a report about the number and types of contracts the Department of Defense awarded to minority-owned and women-owned businesses during fiscal years 2010 to 2015.
If the 2017 NDAA is signed into law, the GAO would be required to submit its report within one year of the statute’s enactment.
An owner of a mere 4.16% minority interest nonetheless “controlled” a company within the meaning of the SBA’s affiliation rules because the company’s ownership was split among approximately 20 companies, each with an equal ownership interest.
In a recent size appeal decision, the SBA Office of Hearings and Appeals confirmed that, where a company has no 50% or greater owner, a minority owner may be presumed to control the company–even where that ownership is as little as 4.16%.
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.