Tag Archives: teaming agreements

GAO: Ostensible Subcontractor Rule Not Part of Set-Aside Decision

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When deciding whether to set aside a solicitation for small businesses, procuring agencies need not consider whether prospective small business offerors can perform the contract without violating the SBA’s ostensible subcontractor rule.

This was the ruling of the GAO in a recent bid protest decision, in which the GAO held that a procuring agency had properly set aside a contract for small businesses without prior consideration of the ostensible subcontractor rule.  The GAO’s decision aligns with the one discussed in yesterday’s post, in which the GAO held that an a procuring agency need not consider the individual capabilities of potential small business offerors to meet all solicitation requirements before setting aside a solicitation.

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No SBA Prior Approval of Teaming Agreement Leads to 8(a) Program Termination

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In a case that ought to make 8(a) participants sit up and take notice, an 8(a) company was terminated from the 8(a) program for failing to obtain the SBA’s prior approval of its teaming agreement for an 8(a) contract–and the SBA Office of Hearings and Appeals upheld the termination.

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Teaming Agreements and Proprietary Information: A Cautionary Tale

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Are you taking adequate steps to protect your proprietary and confidential information from misuse by teammates?

If your teaming agreement or non-disclosure agreement requires you to mark proprietary information with a “protected” legend, the answer may be “no.”  Although many standard teaming agreements and non-disclosure agreements require protective legends in order to protect confidential information, contractors sometimes fail to apply the appropriate legend.  And when that happens, at least according to a recent decision of the U.S. Court of Federal Claims, the contractor may have no basis to complain that the teammate stole its confidential information.

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WOSB Downgraded for Reliance on Teammate’s Experience

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Small government contractors often rely on teammates and subcontractors to demonstrate relevant experience.  But as one recently-published GAO bid protest decision shows, some procuring agencies may take a dim view of such reliance.

In Quasars, Inc., B-405747 (Dec. 7, 2011), the agency found that a woman-owned small business’s reliance on a teammate for relevant experience was risky, because that teammate might leave, depriving the team of the necessary expertise.  The GAO found nothing unreasonable in the agency’s evaluation.

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Agency to Offerors: Show Us Your Subcontracts

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Small government contractors sometimes rely on subcontractors to help satisfy experience, certification, past performance, and other solicitation requirements.  But if one recent GAO bid protest decision is an indication of things to come, procuring agencies may begin requiring more information up front about major subcontractors–including a copy of the final subcontract agreement itself.

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Teaming Agreements and the Ostensible Subcontractor Rule: SBA OHA Decision Provides Some Guidance

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Teaming agreements for small business set-aside contracts can be tricky.  On the one hand, unlike 8(a) and SDVOSB joint venture agreements, there are no mandatory provisions.  On the other, if a competitor files an SBA size protest challenging the award, the teaming agreement may be “Exhibit A” in the SBA’s evaluation of whether the team violated the ostensible subcontractor rule.  In other words, mess up the teaming agreement, and you could have a big problem on your hands.

The SBA has never published a road map to a perfect teaming agreement, but a recent SBA OHA decision–which found no ostensible subcontractor rule violation–highlights a few provisions that prime contractors and their subcontractors would be wise to consider including.

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Large Contractor Downgraded for Inadequate Subcontracting Plan

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Many contractors, large and small, will tell you that the government is taking its small business obligations seriously these days.  The renewed emphasis on small business can be seen not only at the prime contracting level, where we are finally getting close to the 23% government-wide goal, but also at the subcontracting level.

Contracting agencies are closely scrutinizing large businesses’ subcontracting plans for small and disadvantaged businesses.  Case in point: the agency evaluation in L-3 STRATIS, B-404865 (June 8, 2011).

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