(d) a contract referred to in point (a) of Article 8, whether in the base year or in the option year, shall be terminated for reasons of clarity if the contractor referred to in point (a) of Article 8 to whom it has been awarded transfers ownership or control of the undertaking or if, for any reason, the contract is transferred or renewed to another company; unless the SBA administrator waives the obligation to terminate the contract (13 CFR 124.515). The administrator may waive the obligation to terminate only if certain conditions are met. In addition, a waiver of the termination requirement will only be admissible if the Contractor`s request for waiver under paragraph 8(a) is addressed to the SBA prior to the actual renunciation of ownership or control, except in the event of death or incapacity if the waiver must be filed within 60 calendar days of such an event. The contract clauses entitled “Special Contractual Conditions 8(a)” and “Special Conditions 8(a) of Subcontracting” require the SBA and Subcontractor 8(a) to notify the Contractor when ownership of the Company is transferred. Where the contractor receives information that it intends to transfer ownership or control to another undertaking in accordance with point (a) of Article 8, it shall immediately take measures to preserve the possibility of waiving the obligation to terminate the contract. The contract agent shall determine the date of the proposed transfer and its impact on the performance of the contract and the support of the mission. If the contract agent finds that the SBA does not intend to waive the obligation to terminate the contract and that termination of the contract would significantly jeopardise the achievement of the objectives of the programme or the Agency`s mandate, he shall immediately inform the SBA in writing that the Agency is requesting a derogation. Within 15 working days or within a longer period agreed by the Agency and the SBA, the Agency Manager must confirm or withdraw the request for derogation. Unless a waiver is approved by the SBA, the contract agent must terminate the contract for reasons of simplicity upon receipt of a written request from the SBA.
This convenience termination requirement does not affect the government`s right to terminate for late payment if the reason for terminating an 8(a) contract is not the transfer of ownership or control. One of the most common challenges for small businesses trying to comply with 125.6 restrictions on outsourcing is determining what it means to work alone. For example, the Federal Claims Court recently ended a long saga – including protests against the GAO and SBA – over whether a person included in the winner`s proposal was an employee of a small business (and therefore counted for the self-performance requirement) or an independent contractor “1099” (not counted in the requirement). As many contractors know, the regulations set out in 13 CFR § 125.6 set minimum requirements for the self-performance of prime contractors for small businesses carrying out different types of dismantling contracts. The purpose of these rules is to ensure that the financial benefits of small business decommissioning contracts remain with legitimate small business entrepreneurs. The SBA does not want small companies to outsource most of their contract work to large companies. This would deprive legitimate small businesses of contractual revenues and undermine the purpose of the Agency`s small business programs. In order to avoid this problem, SBA 13 CFR issued § 125.6, according to which the prime number must perform a certain percentage of the work itself. The final rule also relaxes performance requirements for small business prime contractors by effectively allowing them to count work done by other small businesses like their own. The new rule does not constitute subcontracting work performed by “companies in a similar situation” for the purpose of establishing compliance with the restriction of subcontracting requirements.
For example, if a small business prime contractor performs 35% of the work and one of its small business subcontractors performs 15% of the work, the prime contractor has complied with the subcontracting restrictions. (ii) In the event of competition, a statement that at least two participants referred to in paragraph 8(a) are considered capable of meeting the Agency`s requirements and a statement that the participants are also eligible with respect to their status as small businesses in relation to the NAICS code assigned, the levels of support for business and the objectives of the business activity. At the request of the contracting authority, the SBA shall identify at least two of those participants and provide information on the capacities of the participants. .