Home > Legal Library > Article




Join Matindale-Hubbell Connected


SBA Creates "SBTA" Exemption to Affiliation Rules on Bundled Contracts




by:
Edward T. DeLisle
Maria L. Panichelli
Cohen Seglias Pallas Greenhall & Furman PC - Philadelphia Office

 
October 23, 2013

Previously published on October 18, 2013

On October 2, 2013, the Small Business Administration (“SBA”) published a final rule implementing changes required by the Small Business Jobs Act of 2010. One of the most interesting changes relates to “bundling,” “affiliation,” and the ability of small businesses to form a new type of teaming arrangement known as a “SBTA.”

“Bundling” refers to “the consolidation of two or more procurement requirements for goods or services previously provided or performed under separate smaller contracts into a solicitation of offers for a single contract.” (13 C.F.R. § 125.2) The problem is, when contracts are “bundled” they often become too big, or too complex, for a small business to handle alone.

The SBA’s new rule seeks to lessen the negative impact of “bundling” on small business contractors. It permits small businesses to form a new type of arrangement known as a “Small Business Teaming Agreement” (“SBTA”), which is excepted from the normal affiliation rules. Under the revised rule, small businesses may form these SBTAs without undergoing any “affiliation” analysis under 13 C.F.R. § 121. In other words, on bundled contracts small businesses are now free to team with other small businesses without worrying that they could be deemed “affiliates” and risk losing their small business size status. There has been much consternation in the small business world about the concept of bundling. By virtue of this rule, the SBA is attempting to level the playing field by providing small businesses with an additional way to compete.



 

The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.
 

View More Library Documents By...

 
Author
 
Edward T. DeLisle
Maria L. Panichelli
 
Cohen Seglias Pallas Greenhall & Furman PC Overview