In most size and status protests, SBA’s Office of Hearings and Appeals (OHA) will determine an offeror’s eligibility for a procurement as of the date of initial offer including price for that procurement. Indeed, with regards to SDVOSBs and VOSBs specifically, 13 C.F.R § 134.1003(e)(1) states that “[i]f the VOSB or SDVOSB status protest pertains to a procurement, the Judge will determine a protested concern’s eligibility as a VOSB or SDVOSB as of the date of its initial offer or response which includes price for a competitively awarded VOSB/SDVOSB contract, order, or agreement, and as of the date of award for any sole source VOSB or SDVOSB award.” But there is an important exception to this rule (something another company found out regarding its mentor-protégé joint venture recently) in that very clause, and, recently, OHA pointed this out in a GSA-led protest of an SDVOSB joint venture (VSBC-459-P, January 15, 2026). Today, we’ll look at that decision.
Continue readingTag Archives: SDVOSB joint venture agreements
Extraordinary Actions v. Day-to-Day Decisions for Joint Ventures: A Cautionary Tale
Back in 2020, we discussed an SBA Office of Hearings and Appeals (OHA) decision stating that the managing venturer must control every aspect of the joint venture. This position, which we questioned in that article, has changed since that time, and we explored the changes to the regulatory language in question not long thereafter. But this regulatory language was still vague. Since that time, there has been much case law development. The Court of Federal Claims (COFC) held in 2022, “[a] minority owner’s control over “extraordinary” actions, such as actions intended to protect the investment of minority shareholders, will not result in a finding of negative control” and applied this idea to a populated joint venture. Swift & Staley, Inc. v. United States, No. 21-1279, 2022 WL 1231428 (Fed. Cl. Mar. 31, 2022), aff’d, No. 2022-1601, 2022 WL 17576348 (Fed. Cir. Dec. 12, 2022). It now appears, fairly established at this point, that non-managing venturers can have a say in what can best be described as “extraordinary actions.” These are the sorts of decisions that can completely change the trajectory of the joint venture. But contractors must still be very careful in giving the non-managing venturer a say in the joint venture’s decisions. As one firm learned the hard way in a recent COFC case, a joint venture with too many actions controllable by the non-managing venturer may end up ineligible for set-asides. Here, we explore this decision.
Continue readingJoint Venture Agreement Fails for Lack of Detail–And Too Much Detail on Venturer Control
A joint venture agreement must closely follow Small Business Administration rules to be compliant for a small business set-aside. And SBA interprets those rules strictly. If they are not followed, a joint venture that was up for award, can see that award go up in smoke. Here, SBA said that a joint venture involving a Service-Disabled Veteran-Owned Small Business (SDVOSB) was not compliant because it was both (a) not specific enough and (b) too detailed in providing for oversight of actions of the JV partners.
Continue readingBack to Basics: Top Five Things About SDVOSBs and VOSBs
You’ve served your country with pride. Now, as a government contractor, it’s only fair that you get your piece of the pie. Previously, we here at SmallGovCon have discussed the 5 things you should know regarding SDVOSBs and VOSBs. But in the years since that, much has changed in the world of SDVOSBs and VOSBs. So here are five updated basics you should know about the government’s contracting program for veteran-owned small businesses and service-disabled veteran-owned small businesses:
Continue readingJoint Ventures: Is “Unequivocal Control” Required?
Fans of the blog know that we’re wild about joint ventures: they allow small business contractors to use their size status while, at the same time, leveraging their joint venture partner’s experience and capabilities.
But joint ventures—particularly joint ventures under one of the SBA’s socioeconomic programs—can be tricky to create. For joint ventures between a small and a large company, the venturers first need an approved mentor-protégé agreement. And regardless, for the joint venture to qualify under a socioeconomic designation, that joint venture must have a compliant agreement.
But that’s still not enough to create a compliant joint venture. As a recent SBA Office of Hearings and Appeals decision explains, the small business venturer must unequivocally control the joint venture.
Continue readingVA Updates Guidance on SDVOSB Joint Ventures, Fixes Error
As of September 2019, the VA has updated its Verification Assistance Brief on SDVOSB joint ventures. The old assistance brief was last revised in 2017 and contained some incorrect information. To its credit, this update removes the wrong info and it contains some additional guidance that could be helpful for SDVOSB joint venture members.
Continue readingFailure to Update Joint Venture Agreement Costs Mentor-Protégé SDVOSB JV a Contract
Updating your joint venture agreement is essential to maintaining compliance with SBA’s regulations and failing to update could cost you contracts.
In Stacqme, LLC, SBA No. SIZ-5976 (Dec. 10, 2018), the SBA Office of Hearings and Appeals held that a mentor-protege joint venture’s failure to update its JV agreement caused the agreement to be non-compliant with the SBA’s rules, and meant that the joint venture was ineligible for an SDVOSB set-aside contract.
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