Nonmanufacturer Rule: Large Manufacturers OK’d For Certain Simplified Acquisitions

In a small business set-aside simplified acquisition of $25,000 or less, small business offerors may propose using large business manufacturers while still complying with the requirements of the nonmanufacturer rule.

In a recent decision, the SBA’s Office of Hearings and Appeals held that an apparent ambiguity contained in the nonmanufacturer regulation for certain simplified acquisitions should be resolved in favor of exempting offerors from the requirement that the manufacturer be a small business concern.

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Nonmanufacturer Rule Class Waivers: SBA OHA Explains How They Work

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.

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