SBA OHA: No “Unfair Competitive Advantage” Appeals

The SBA Office of Hearings and Appeals lacks jurisdiction to consider whether an entity owned by an Indian tribe or Alaska Native Corporation has obtained a substantial unfair competitive advantage within an industry.

In a recent size appeal case, OHA acknowledged that an unfair competitive advantage is an exception to the special affiliation rules that tribally-owned companies ordinarily enjoy–but held that only the SBA Administrator has the power to determine that an Indian tribe or ANC has obtained, or will obtain, such an unfair advantage.

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SBA OHA Confirms Broad Affiliation Exception for Tribal Companies

The SBA Office of Hearings and Appeals has held that the SBA Area Office did not err by refusing to find affiliation between a tribally-owned company and its sister companies.

SBA OHA’s recent decision in Size Appeal of Bosco Contractors, Inc., SBA No. SIZ-5412 (2012), follows on the heels of Size Appeal of Roundhouse PBN, LLC, SBA No. SIZ-5383 (2012), in which SBA OHA found that the SBA had erred by adopting a too-narrow view of the tribal exception from affiliation.

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SBA OHA: Tribal Companies Entitled to Broad Affiliation Exceptions

Indian tribes, their holding companies, and companies owned by those holding companies are entitled to broad exceptions from the ordinary SBA affiliation rules, according to a recent SBA Office of Hearings and Appeals size appeal decision.

SBA OHA’s decision in Size Appeal of Roundhouse PBN, LLC, SBA No. SIZ-5383 (2012), holds that the SBA cannot use non-applicable affiliation rules to circumvent the regulatory exception from affiliation between tribal companies.  In its ruling, SBA OHA also sidestepped an interesting tribal size question: did Congress truly intend for some tribal companies to be “small” for 8(a) program purposes, but “other than small” for all other government contracts?

As you can probably tell, the Roundhouse PBN case is not your run-of-the-mill SBA OHA size appeal decision, meaning a slightly longer-than-normal blog post is in order.  Let’s dive right in.

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