SMALL BUSINESS SIZE REGULATIONS

• Citation: 13 CFR Part 121
• Sections: 78

Appendix A Appendix A to Part 121—Paycheck Protection Program Sample Addendum A

[Sample]

ADDENDUM A

✓ The Applicant claims an exemption from all SBA affiliation rules applicable to Paycheck Protection Program loan eligibility because the Applicant has made a reasonable, good faith determination that the Applicant qualifies for a religious exemption under 13 CFR 121.103(b)(10), which says that “[t]he relationship of a faith-based organization to another organization is not considered an affiliation with the other organization . . . if the relationship is based on a religious teaching or belief or otherwise constitutes a part of the exercise of religion.”

§ 121.101 What are SBA size standards?

(a) SBA's size standards define whether a business entity is small and, thus, eligible for Government programs and preferences reserved for “small business” concerns. Size standards have been established for types of economic activity, or industry, generally under the North American Industry Classification System (NAICS).

(b) NAICS is described in the North American Industry Classification Manual-United States, which is available from the National Technical Information Service, 5285 Port Royal Road, Springfield, VA 22161; by calling 1(800) 553-6847 or 1(703) 605-6000; or via the Internet at http://www.ntis.gov/products/naics.aspx. The manual includes definitions for each industry, tables showing relationships between 1997 NAICS and 1987 SICs, and a comprehensive index. NAICS assigns codes to all economic activity within twenty broad sectors. Section 121.201 provides a full table of small business size standards matched to the U.S. NAICS industry codes. A full table matching a size standard with each NAICS Industry or U.S. Industry code is also published annually by SBA in the Federal Register.

§ 121.102 How does SBA establish size standards?

(a) SBA considers economic characteristics comprising the structure of an industry, including degree of competition, average firm size, start-up costs and entry barriers, and distribution of firms by size. It also considers technological changes, competition from other industries, growth trends, historical activity within an industry, unique factors occurring in the industry which may distinguish small firms from other firms, and the objectives of its programs and the impact on those programs of different size standard levels.

(b) As part of its review of a size standard, SBA will investigate if any concern at or below a particular standard would be dominant in the industry. SBA will take into consideration market share of a concern and other appropriate factors which may allow a concern to exercise a major controlling influence on a national basis in which a number of business concerns are engaged. Size standards seek to ensure that a concern that meets a specific size standard is not dominant in its field of operation.

(c) As part of its review of size standards, SBA's Office of Size Standards will examine the impact of inflation on monetary-based size standards (e.g., receipts, net income, assets) at least once every five years and submit a report to the Administrator or designee. If SBA finds that inflation has significantly eroded the value of the monetary-based size standards, it will issue a proposed rule to increase size standards.

(d) Please address any requests to change existing size standards or establish new ones for emerging industries to the Division Chief, Office of Size Standards, Small Business Administration, 409 3rd Street, SW., Washington, DC 20416.

(e) When SBA publishes a final rule in the Federal Register revising, modifying, or establishing a size standard, SBA will include in the final rule, an instruction that interested persons may file a petition for reconsideration of a revised, modified, or established size standard at SBA's Office of Hearings and Appeals (OHA) within 30 calendar days after publication of the final rule in accordance with 15 U.S.C. 632(a)(9) and part 134, subpart I of this chapter. The instruction will provide the mailing address, facsimile number, and email address of OHA.

(f) Within 14 calendar days after a petition for reconsideration of a size standard is filed, unless it appears OHA will dismiss the petition for reconsideration, SBA will publish a document in the Federal Register announcing the size standard or standards that have been challenged, the Federal Register citation of the final rule, the assigned OHA docket number, and the date of the close of record. The document will further state that interested parties may contact OHA to intervene in the dispute pursuant to § 134.906 of this chapter.

(g) Where OHA grants a petition for reconsideration of a size standard that had been revised or modified, OHA will remand the case to SBA's Office of Size Standards for further action in accordance with § 134.916(a) of this chapter.

§ 121.103 How does SBA determine affiliation?

(a) General Principles of Affiliation. (1) Concerns and entities are affiliates of each other when one controls or has the power to control the other, or a third party or parties controls or has the power to control both. It does not matter whether control is exercised, so long as the power to control exists.

(2) SBA considers factors such as ownership, management, previous relationships with or ties to another concern, and contractual relationships, in determining whether affiliation exists.

(3) Control may be affirmative or negative. Negative control includes, but is not limited to, instances where a minority shareholder has the ability, under the concern's charter, by-laws, or shareholder's agreement, to prevent a quorum or otherwise block action by the board of directors or shareholders. However, SBA will not find that a minority shareholder has negative control where such minority shareholder has the authority to block action by the board of directors or shareholders regarding the following extraordinary circumstances:

(i) Adding a new equity stakeholder or increasing the investment amount of an equity stakeholder;

(ii) Dissolution of the company;

(iii) Sale of the company or all assets of the company;

(iv) The merger of the company;

(v) The company declaring bankruptcy;

(vi) Amendment of the company's corporate governance documents to remove the shareholder's authority to block any of (a)(3)(i) through (v); and

(vii) Any other extraordinary action that is crafted solely to protect the investment of the minority shareholders, and not to impede the majority's ability to control the concern's operations or to conduct the concern's business as it chooses.

(4) Affiliation may be found where an individual, concern, or entity exercises control indirectly through a third party.

(5) In determining whether affiliation exists, SBA will consider the totality of the circumstances, and may find affiliation even though no single factor is sufficient to constitute affiliation.

(6) In determining the concern's size, SBA counts the receipts, employees, or other measure of size of the concern whose size is at issue and all of its domestic and foreign affiliates, regardless of whether the affiliates are organized for profit.

(7) For SBA's Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs, the bases for affiliation are set forth in § 121.702.

(8) For applicants in SBA's Business Loan, Disaster Loan, and Surety Bond Guarantee Programs, the size standards and bases for affiliation are set forth in § 121.301.

(b) Exceptions to affiliation coverage. (1) Business concerns owned in whole or substantial part either by investment companies licensed, or by development companies qualifying, under the Small Business Investment Act of 1958, as amended, or by investment companies to which a Reinvestor SBIC (within the meaning of 13 CFR 107.720(a)(2)) has provided a meaningful percentage of Equity Capital are not considered affiliates of such investment companies or development companies.

(2)(i) Business concerns owned and controlled by Indian Tribes, Alaska Native Corporations (ANCs) organized pursuant to the Alaska Native Claims Settlement Act (43 U.S.C. 1601 et seq. ), Native Hawaiian Organizations (NHOs), Community Development Corporations (CDCs) authorized by 42 U.S.C. 9805, or wholly-owned entities of Indian Tribes, ANCs, NHOs, or CDCs are not considered affiliates of such entities.

(ii) Business concerns owned and controlled by Indian Tribes, ANCs, NHOs, CDCs, or wholly-owned entities of Indian Tribes, ANCs, NHOs, or CDCs, are not considered to be affiliated with other concerns owned by these entities because of their common ownership or common management. In addition, affiliation will not be found based upon the performance of common administrative services so long as adequate payment is provided for those services. Affiliation may be found for other reasons.

(A) Common administrative services which are subject to the exception to affiliation include, bookkeeping, payroll, recruiting, other human resource support, cleaning services, and other duties which are otherwise unrelated to contract performance or management and can be reasonably pooled or otherwise performed by a holding company, parent entity, or sister business concern without interfering with the control of the subject firm.

(B) Contract administration services include both services that could be considered “common administrative services” under the exception to affiliation and those that could not.

( 1 ) Contract administration services that encompass actual and direct day-to-day oversight and control of the performance of a contract/project are not shared common administrative services, and would include tasks or functions such as negotiating directly with the government agency regarding proposal terms, contract terms, scope and modifications, project scheduling, hiring and firing of employees, and overall responsibility for the day-to-day and overall project and contract completion.

( 2 ) Contract administration services that are administrative in nature may constitute administrative services that can be shared, and would fall within the exception to affiliation. These administrative services include tasks such as record retention not related to a specific contract ( e.g., employee time and attendance records), maintenance of databases for awarded contracts, monitoring for regulatory compliance, template development, and assisting accounting with invoice preparation as needed.

(C) Business development may include both services that could be considered “common administrative services” under the exception to affiliation and those that could not. Efforts at the holding company or parent level to identify possible procurement opportunities for specific subsidiary companies may properly be considered “common administrative services” under the exception to affiliation. However, at some point the opportunity identified by the holding company's or parent entity's business development efforts becomes concrete enough to assign to a subsidiary and at that point the subsidiary must be involved in the business development efforts for such opportunity. At the proposal or bid preparation stage of business development, the appropriate subsidiary company for the opportunity has been identified and a representative of that company must be involved in preparing an appropriate offer. This does not mean to imply that one or more representatives of a holding company or parent entity cannot also be involved in preparing an offer. They may be involved in assisting with preparing the generic part of an offer, but the specific subsidiary that intends to ultimately perform the contract must control the technical and contract specific portions of preparing an offer. In addition, once award is made, employee assignments and the logistics for contract performance must be controlled by the specific subsidiary company and should not be performed at a holding company or parent entity level.

(3) Business concerns which are part of an SBA approved pool of concerns for a joint program of research and development or for defense production as authorized by the Small Business Act are not affiliates of one another because of the pool.

(4) Business concerns which lease employees from concerns primarily engaged in leasing employees to other businesses or which enter into a co-employer arrangement with a Professional Employer Organization (PEO) are not affiliated with the leasing company or PEO solely on the basis of a leasing agreement.

(5) For financial, management or technical assistance under the Small Business Investment Act of 1958, as amended, (an applicant is not affiliated with the investors listed in paragraphs (b)(5) (i) through (vi) of this section.

(i) Venture capital operating companies, as defined in the U.S. Department of Labor regulations found at 29 CFR 2510.3-101(d);

(ii) Employee benefit or pension plans established and maintained by the Federal government or any state, or their political subdivisions, or any agency or instrumentality thereof, for the benefit of employees;

(iii) Employee benefit or pension plans within the meaning of the Employee Retirement Income Security Act of 1974, as amended (29 U.S.C. 1001, et seq. );

(iv) Charitable trusts, foundations, endowments, or similar organizations exempt from Federal income taxation under section 501(c) of the Internal Revenue Code of 1986, as amended (26 U.S.C. 501(c));

(v) Investment companies registered under the Investment Company Act of 1940, as amended (1940 Act) (15 U.S.C. 80a-1, et seq. ); and

(vi) Entities determined by SBA to be Traditional Investment Companies under 13 CFR 107.150(b)(2) and private funds exempt from registration under section 3(c)(1) or 3(c)(7) of the 1940 Act.

(6) A firm that has an SBA-approved mentor-protégé agreement authorized under § 125.9 of this chapter is not affiliated with its mentor or protégé firm solely because the protégé firm receives assistance from the mentor under the agreement. Similarly, a protégé firm is not affiliated with its mentor solely because the protégé firm receives assistance from the mentor under a federal mentor-protégé program where an exception to affiliation is specifically authorized by statute or by SBA under the procedures set forth in § 121.903. Affiliation may be found in either case for other reasons as set forth in this section.

(7) The member shareholders of a small agricultural cooperative, as defined in the Agricultural Marketing Act (12 U.S.C. 1141j), are not considered affiliated with the cooperative by virtue of their membership in the cooperative.

(8) These exceptions to affiliation and any others set forth in § 121.702 apply for purposes of SBA's SBIR and STTR programs.

(9) In the case of a solicitation for a bundled contract or a Multiple Award Contract with a value in excess of the agency's substantial bundling threshold, a small business contractor may enter into a Small Business Teaming Arrangement with one or more small business subcontractors and submit an offer as a small business without regard to affiliation, so long as each team member is small for the size standard assigned to the contract or subcontract. The agency shall evaluate the offer in the same manner as other offers with due consideration of the capabilities of the subcontractors.

(10)(i) The relationship of a faith-based organization to another organization is not considered an affiliation with the other organization under this subpart if the relationship is based on a religious teaching or belief or otherwise constitutes a part of the exercise of religion. In addition, the eligibility criteria set forth in 15 U.S.C. 636(a)(36)(D) are satisfied for any faith-based organization having not more than 500 employees (including individuals employed on a full-time, part-time, or other basis) that pays Federal payroll taxes using its own Internal Revenue Service Employer Identification Number (EIN) or that would support a deduction under the second sentence of 26 U.S.C. 512(b)(12) if the organization generated unrelated business taxable income. For purposes of this paragraph (b)(10), the term “faith-based organization” includes, but is not limited to, any organization associated with a church or convention or association of churches within the meaning of 26 U.S.C. 414(e)(3)(D). The term “organization” has the meaning given in 26 U.S.C. 414(m)(6)(A). The terms “church” and “convention or association of churches” have the same meaning that they have in 26 U.S.C. 414.

(ii) No specific process or filing is necessary to claim the benefit of the exemption in paragraph (b)(10)(i) of this section. In applying for a loan under the Paycheck Protection Program (PPP), a faith-based organization may make all necessary certifications with respect to common ownership or management or other eligibility criteria based upon affiliation, if the organization would be an eligible borrower but for application of SBA affiliation rules and if the organization falls within the terms of the exemption described in paragraph (b)(10)(i) of this section. If a faith-based organization indicates any relationship that may pertain to affiliation, such as ownership of, ownership by, or common management with any other organization, on or in connection with a loan application, and if the faith-based organization applying for a loan falls within the terms of the exemption described in paragraph (b)(10)(i) of this section with respect to that relationship, the faith-based organization may indicate on a separate sheet that it is entitled to the exemption. That sheet may be identified as addendum A, and no further listing of the other organization or description of the relationship to that organization is required. See appendix A to this part for a sample “Addendum A”, but the format need not be used as long as the substance is the same.

(c) Affiliation based on stock ownership. (1) A person (including any individual, concern or other entity) that owns, or has the power to control, 50 percent or more of a concern's voting stock, or a block of voting stock which is large compared to other outstanding blocks of voting stock, controls or has the power to control the concern.

(2) If two or more persons (including any individual, concern or other entity) each owns, controls, or has the power to control less than 50 percent of a concern's voting stock, and such minority holdings are equal or approximately equal in size, and the aggregate of these minority holdings is large as compared with any other stock holding, SBA presumes that each such person controls or has the power to control the concern whose size is at issue. This presumption may be rebutted by a showing that such control or power to control does not in fact exist.

(3) If a concern's voting stock is widely held and no single block of stock is large as compared with all other stock holdings, the concern's Board of Directors and CEO or President will be deemed to have the power to control the concern in the absence of evidence to the contrary.

(d) Affiliation arising under stock options, convertible securities, and agreements to merge. (1) In determining size, SBA considers stock options, convertible securities, and agreements to merge (including agreements in principle) to have a present effect on the power to control a concern. SBA treats such options, convertible securities, and agreements as though the rights granted have been exercised.

(2) Agreements to open or continue negotiations towards the possibility of a merger or a sale of stock at some later date are not considered “agreements in principle” and are thus not given present effect.

(3) Options, convertible securities, and agreements that are subject to conditions precedent which are incapable of fulfillment, speculative, conjectural, or unenforceable under state or Federal law, or where the probability of the transaction (or exercise of the rights) occurring is shown to be extremely remote, are not given present effect.

(4) An individual, concern or other entity that controls one or more other concerns cannot use options, convertible securities, or agreements to appear to terminate such control before actually doing so. SBA will not give present effect to individuals', concerns' or other entities' ability to divest all or part of their ownership interest in order to avoid a finding of affiliation.

(e) Affiliation based on common management. Affiliation arises where one or more officers, directors, managing members, or partners who control the board of directors and/or management of one concern also control the board of directors or management of one or more other concerns.

(f) Affiliation based on identity of interest. Affiliation may arise among two or more persons with an identity of interest. Individuals or firms that have identical or substantially identical business or economic interests (such as family members, individuals or firms with common investments, or firms that are economically dependent through contractual or other relationships) may be treated as one party with such interests aggregated. Where SBA determines that such interests should be aggregated, an individual or firm may rebut that determination with evidence showing that the interests deemed to be one are in fact separate.

(1) Firms owned or controlled by married couples, parties to a civil union, parents, children, and siblings are presumed to be affiliated with each other if they conduct business with each other, such as subcontracts or joint ventures or share or provide loans, resources, equipment, locations or employees with one another. This presumption may be overcome by showing a clear line of fracture between the concerns. Other types of familial relationships are not grounds for affiliation on family relationships.

(2) SBA may presume an identity of interest based upon economic dependence if the concern in question derived 70% or more of its receipts from another concern over the previous three fiscal years.

(i) This presumption may be rebutted by a showing that despite the contractual relations with another concern, the concern at issue is not solely dependent on that other concern, such as where the concern has been in business for a short amount of time and has only been able to secure a limited number of contracts or where the contractual relations do not restrict the concern in question from selling the same type of products or services to another purchaser.

(ii) A business concern owned and controlled by an Indian Tribe, ANC, NHO, CDC, or by a wholly-owned entity of an Indian Tribe, ANC, NHO, or CDC, is not considered to be affiliated with another concern owned by that entity based solely on the contractual relations between the two concerns.

Example 1 to paragraph (f).

Firm A has been in business for 9 months and has two contracts. Contract 1 is with Firm B and is valued at $900,000 and Contract 2 is with Firm C and is valued at $200,000. Thus, Firm B accounts for over 70% of Firm A's receipts. Absent other connections between A and B, the presumption of affiliation between A and B is rebutted because A is a new firm.

Example 2 to paragraph (f).

Firm A has been in business for five years and has approximately 200 contracts. Of those contracts, 195 are with Firm B. The value of Firm A's contracts with Firm B is greater than 70% of its revenue over the previous three years. Unless Firm A can show that its contractual relations with Firm B do not restrict it from selling the same type of products or services to another purchaser, SBA would most likely find the two firms affiliated.

(g) Affiliation based on the newly organized concern rule. Except as provided in § 124.109(c)(4)(iii), affiliation may arise where former or current officers, directors, principal stockholders, managing members, or key employees of one concern organize a new concern in the same or related industry or field of operation, and serve as the new concern's officers, directors, principal stockholders, managing members, or key employees, and the one concern is furnishing or will furnish the new concern with contracts, financial or technical assistance, indemnification on bid or performance bonds, and/or other facilities, whether for a fee or otherwise. A concern may rebut such an affiliation determination by demonstrating a clear line of fracture between the two concerns. A “key employee” is an employee who, because of his/her position in the concern, has a critical influence in or substantive control over the operations or management of the concern.

(h) Affiliation based on joint ventures. A joint venture is an association of individuals and/or concerns with interests in any degree or proportion intending to engage in and carry out business ventures for joint profit over a two-year period, for which purpose they combine their efforts, property, money, skill, or knowledge, but not on a continuing or permanent basis for conducting business generally. This means that a specific joint venture generally may not be awarded contracts beyond a two-year period, starting from the date of the award of the first contract, without the partners to the joint venture being deemed affiliated for the joint venture. However, a joint venture may be issued an order under a previously awarded contract beyond the two-year period. Once a joint venture receives a contract, it may submit additional offers for a period of two years from the date of that first award. An individual joint venture may be awarded one or more contracts after that two-year period as long as it submitted an offer prior to the end of that two-year period. SBA will find joint venture partners to be affiliated, and thus will aggregate their receipts and/or employees in determining the size of the joint venture for all small business programs, where the joint venture submits an offer after two years from the date of the first award. The same two (or more) entities may create additional joint ventures, and each new joint venture may submit offers for a period of two years from the date of the first contract to the joint venture without the partners to the joint venture being deemed affiliates. At some point, however, such a longstanding inter-relationship or contractual dependence between the same joint venture partners may lead to a finding of general affiliation between and among them. SBA may also determine that the relationship between a prime contractor and its subcontractor is a joint venture pursuant to paragraph (h)(3) of this section. For purposes of this paragraph (h), contract refers to prime contracts, novations of prime contracts, and any subcontract in which the joint venture is treated as a similarly situated entity as the term is defined in part 125 of this chapter.

Example 1 to paragraph (h) introductory text.

Joint Venture AB receives a contract on April 2, year 1. Joint Venture AB may receive additional contracts through April 2, year 3. On June 6, year 2, Joint Venture AB submits an offer for Solicitation 1. On July 13, year 2, Joint Venture AB submits an offer for Solicitation 2. On May 27, year 3, Joint Venture AB is found to be the apparent successful offeror for Solicitation 1. On July 22, year 3, Joint Venture AB is found to be the apparent successful offeror for Solicitation 2. Even though the award of the two contracts emanating from Solicitations 1 and 2 would occur after April 2, year 3, Joint Venture AB may receive those awards without causing general affiliation between its joint venture partners because the offers occurred prior to the expiration of the two-year period.

Example 2 to paragraph (h) introductory text.

Joint Venture XY receives a contract on August 10, year 1. It may receive two additional contracts through August 10, year 3. On March 19, year 3, XY receives its fifth contract. It receives no other contract awards through August 10, year 3 and has submitted no additional offers prior to August 10, year 3. Because two years have passed since the date of the first contract award, after August 10, year 3, XY cannot receive an additional contract award. The individual parties to XY must form a new joint venture if they want to seek and be awarded additional contracts as a joint venture.

Example 3 to paragraph (h) introductory text.

Joint Venture XY receives a contract on December 15, year 1. On May 22, year 3 XY submits an offer for Solicitation S. On December 8, year 3, XY submits a novation package for contracting officer approval for Contract C. In January, year 4 XY is found to be the apparent successful offeror for Solicitation S and the relevant contracting officer seeks to novate Contract C to XY. Because both the offer for Solicitation S and the novation package for Contract C were submitted prior to December 15 year 3, both contract award relating to Solicitation S and novation of Contract C may occur without a finding of general affiliation.

(1) Form of joint venture. A joint venture: must be in writing; must do business under its own name and be identified as a joint venture in the System for Award Management (SAM) for the award of a prime contract or agreement; and may be in the form of a formal or informal partnership or exist as a separate limited liability company or other separate legal entity.

(i) If a joint venture exists as a formal separate legal entity, it cannot be populated with individuals intended to perform contracts awarded to the joint venture for any contract or agreement which is set aside or reserved for small business, unless all parties to the joint venture are similarly situated as that term is defined in part 125 of this chapter ( i.e., the joint venture may have its own separate employees to perform administrative functions, including one or more Facility Security Officer(s), but may not have its own separate employees to perform contracts awarded to the joint venture).

(ii) A populated joint venture that is not comprised entirely of similarly situated entities will be ineligible for any contract or agreement which is set aside or reserved for small business.

(iii) In determining the size of a populated joint venture (whether one involving similarly situated entities or not), SBA will aggregate the revenues or employees of all partners to the joint venture.

(2) Size of joint ventures. (i) A joint venture of two or more business concerns may submit an offer as a small business for a Federal procurement, subcontract or sale so long as each concern is small under the size standard corresponding to the NAICS code assigned to the contract. For a competitive 8(a) procurement, a joint venture between an 8(a) Participant and one or more other small business concerns (including two firms approved by SBA to be a mentor and protégé under § 125.9 of this chapter) must also meet the requirements of § 124.513(c) and (d) of this chapter as of the date of the final proposal revision for negotiated acquisitions and final bid for sealed bidding in order to be eligible for award.

(ii) Two firms approved by SBA to be a mentor and protégé under § 125.9 of this chapter may joint venture as a small business for any Federal government prime contract or subcontract, provided the protégé qualifies as small for the size standard corresponding to the NAICS code assigned to the procurement, and the joint venture meets the requirements of § 124.513 (c) and (d), § 125.8(b) and (c), § 128.402(c) and (d), § 126.616(c) and (d), or § 127.506(c) and (d) of this chapter, as appropriate. Except for sole source 8(a) awards, the joint venture must meet the requirements of § 124.513(c) and (d), § 125.8(b) and (c), § 125.18(b)(2) and (3), § 126.616(c) and (d), or § 127.506(c) and (d) of this chapter, as appropriate, as of the date of the final proposal revision for negotiated acquisitions and final bid for sealed bidding. For a sole source 8(a) award, the joint venture must demonstrate that it meets the requirements of § 124.513(c) and (d) prior to the award of the contract.

(3) Ostensible subcontractors and unduly reliant managing joint venture partners. (i) An offeror is ineligible as a small business concern, an 8(a) small business concern, a certified HUBZone small business concern, a WOSB/EDWOSB concern, or a VOSB/SDVOSB concern where SBA determines there to be an ostensible subcontractor. An ostensible subcontractor is a subcontractor that is not a similarly situated entity, as that term is defined in § 125.1 of this chapter, and performs primary and vital requirements of a contract, or of an order, or is a subcontractor upon which the prime contractor is unusually reliant.

(ii) A prime contractor may use the experience and past performance of a subcontractor to enhance or strengthen its offer, including that of an incumbent contractor. It is only where that subcontractor will perform primary and vital requirements of a contract or order, or the prime contractor is unusually reliant on the subcontractor, that SBA will find the subcontractor to be an ostensible subcontractor.

(iii) In the case of a contract or order set-aside or reserved for small business for services, specialty trade construction or supplies, SBA will find that a small business prime contractor is performing the primary and vital requirements of the contract or order, and is not unduly reliant on one or more subcontractors that are not small businesses, where the prime contractor can demonstrate that it, together with any subcontractors that qualify as small businesses, will meet the limitations on subcontracting provisions set forth in § 125.6 of this chapter.

(iv) In a general construction contract, the primary and vital requirements of the contract are the management, supervision and oversight of the project, including coordinating the work of various subcontractors, not the actual construction work performed.

(v) A joint venture offeror is ineligible as a small business concern, an 8(a) small business concern, a certified HUBZone small business concern, a WOSB/EDWOSB concern, or a VO/SDVO small business concern where SBA determines that the managing joint venture partner will not perform 40% of the work to be performed by the joint venture.

(4) Receipts/employees attributable to joint venture partners. For size purposes, a concern must include in its receipts its proportionate share of joint venture receipts. Proportionate receipts do not include proceeds from transactions between the concern and its joint ventures (e.g., subcontracts from a joint venture entity to joint venture partners) already accounted for in the concern's tax return. In determining the number of employees, a concern must include in its total number of employees its proportionate share of individuals employed by the joint venture. For the calculation of receipts, the appropriate proportionate share is the same percentage of receipts or employees as the joint venture partner's percentage share of the work performed by the joint venture. For a populated joint venture (where work is performed by the joint venture entity itself and not by the individual joint venture partners) the appropriate share is the same percentage as the joint venture partner's percentage ownership share in the joint venture. For the calculation of employees, the appropriate share is the same percentage of employees as the joint venture partner's percentage ownership share in the joint venture, after first subtracting any joint venture employee already accounted for in one of the partner's employee counts.

(5) Facility security clearances. A joint venture may be awarded a contract requiring a facility security clearance where either the joint venture itself or the individual partner(s) to the joint venture that will perform the necessary security work has (have) a facility security clearance.

(i) Where a facility security clearance is required to perform primary and vital requirements of a contract, the lead small business partner to the joint venture must possess the required facility security clearance.

(ii) Where the security portion of the contract requiring a facility security clearance is ancillary to the principal purpose of the procurement, the partner to the joint venture that will perform that work must possess the required facility security clearance.

(i) Affiliation based on franchise and license agreements. The restraints imposed on a franchisee or licensee by its franchise or license agreement relating to standardized quality, advertising, accounting format and other similar provisions, generally will not be considered in determining whether the franchisor or licensor is affiliated with the franchisee or licensee provided the franchisee or licensee has the right to profit from its efforts and bears the risk of loss commensurate with ownership. Affiliation may arise, however, through other means, such as common ownership, common management or excessive restrictions upon the sale of the franchise interest.

§ 121.104 How does SBA calculate annual receipts?

(a) Receipts means all revenue in whatever form received or accrued from whatever source, including from the sales of products or services, interest, dividends, rents, royalties, fees, or commissions, reduced by returns and allowances.

Generally, receipts are considered “total income” (or in the case of a sole proprietorship “gross income”) plus “cost of goods sold” as these terms are defined and reported on Internal Revenue Service (IRS) tax return forms (such as Form 1120 for corporations; Form 1120S for S corporations; Form 1120, Form 1065 or Form 1040 for LLCs; Form 1065 for partnerships; Form 1040, Schedule F for farms; Form 1040, Schedule C for other sole proprietorships). Receipts do not include net capital gains or losses; taxes collected for and remitted to a taxing authority if included in gross or total income, such as sales or other taxes collected from customers and excluding taxes levied on the concern or its employees; proceeds from transactions between a concern and its domestic or foreign affiliates; and amounts collected for another by a travel agent, real estate agent, advertising agent, conference management service provider, freight forwarder or customs broker. For size determination purposes, the only exclusions from receipts are those specifically provided for in this paragraph. All other items, such as subcontractor costs, reimbursements for purchases a contractor makes at a customer's request, investment income, and employee-based costs such as payroll taxes, may not be excluded from receipts.

(1) SBA will consider and generally rely on a concern's Federal income tax return and any amendments filed with the IRS on or before the date of self-certification to determine the size status of the concern. Where a concern may legally exclude certain revenue for tax purposes, SBA will not include that revenue in its analysis. However, SBA may consider other relevant information where there is reasonable basis to believe the tax filings are false.

(2) When a concern has not filed a Federal income tax return with the IRS for a fiscal year which must be included in the period of measurement, SBA will calculate the concern's annual receipts for that year using any other available information, such as the concern's regular books of account, audited financial statements, or information contained in an affidavit by a person with personal knowledge of the facts.

(b) Completed fiscal year means a taxable year including any short year. “Taxable year” and “short year” have the meanings attributed to them by the IRS.

(c) Period of measurement. (1) Except for the Business Loan, Disaster Loan, Surety Bond Guarantee, and Small Business Investment Company (SBIC) Programs, annual receipts of a concern that has been in business for 5 or more completed fiscal years means the total receipts of the concern over its most recently completed 5 fiscal years divided by 5.

(2) Except for the Business Loan, Disaster Loan Programs, Surety Bond Guarantee, and SBIC Programs, annual receipts of a concern which has been in business for less than 5 complete fiscal years means the total receipts for the period the concern has been in business divided by the number of weeks in business, multiplied by 52.

(3) Except for the Business Loan, Disaster Loan, Surety Bond Guarantee, and SBIC Programs, where a concern has been in business 5 or more complete fiscal years but has a short year as one of the years within its period of measurement, annual receipts means the total receipts for the short year and the 4 full fiscal years divided by the total number of weeks in the short year and the 4 full fiscal years, multiplied by 52.

(4) For the Business Loan, Disaster Loan, Surety Bond Guarantee, and SBIC Programs, a concern that has been in business for three or more completed fiscal years may elect to calculate annual receipts using either the total receipts of the concern over its most recently completed 5 fiscal years divided by 5, or the total receipts of the concern over its most recently completed 3 fiscal years divided by 3. Annual receipts of a concern which has been in business for less than three complete fiscal years means the total receipts for the period the concern has been in business divided by the number of weeks in business, multiplied by 52. Where a concern has been in business three or more complete fiscal years but has a short year as one of the years within its period of measurement, annual receipts means the total receipts for the short year and the two full fiscal years divided by the total number of weeks in the short year and the two full fiscal years, multiplied by 52. For the purposes of this subsection, the Business Loan Programs consist of the 7(a) Loan Program, the Microloan Program, the Intermediary Lending Pilot Program, and the Development Company Loan Program (“504 Loan Program”). The Disaster Loan Programs consist of Economic Injury Disaster Loans, Military Reservist Economic Injury Disaster Loans, and Immediate Disaster Assistance Program loans.

(d) Annual receipts of affiliates. (1) The average annual receipts size of a business concern with affiliates is calculated by adding the average annual receipts of the business concern with the average annual receipts of each affiliate.

(2) If a concern has acquired an affiliate or been acquired as an affiliate during the applicable period of measurement or before the date on which it self-certified as small, the annual receipts used in determining size status includes the receipts of the acquired or acquiring concern. This aggregation applies for the entire period of measurement, not just the period after the affiliation arose. However, if a concern has acquired a segregable division of another business concern during the applicable period of measurement or before the date on which it self-certified as small, the annual receipts used in determining size status do not include the receipts of the acquired division prior to the acquisition.

(3) Except for the Business Loan and Disaster Loan Programs, if the business concern or an affiliate has been in business for a period of less than 5 years, the receipts for the fiscal year with less than a 12-month period are annualized in accordance with paragraph (c)(2) of this section. Receipts are determined for the concern and its affiliates in accordance with paragraph (c) of this section even though this may result in using a different period of measurement to calculate an affiliate's annual receipts.

(4) The annual receipts of a former affiliate are not included if affiliation ceased before the date used for determining size. This exclusion of annual receipts of such former affiliate applies during the entire period of measurement, rather than only for the period after which affiliation ceased. However, if a concern has sold a segregable division to another business concern during the applicable period of measurement or before the date on which it self-certified as small, the annual receipts used in determining size status will continue to include the receipts of the division that was sold.

(e) Unless otherwise defined in this section, all terms shall have the meaning attributed to them by the IRS.

§ 121.105 How does SBA define “business concern or concern”?

(a)(1) Except for small agricultural cooperatives, a business concern eligible for assistance from SBA as a small business is a business entity organized for profit, with a place of business located in the United States, and which operates primarily within the United States or which makes a significant contribution to the U.S. economy through payment of taxes or use of American products, materials or labor.

(2) A small agricultural cooperative is an association (corporate or otherwise) acting pursuant to the provisions of the Agricultural Marketing Act (12 U.S.C.A. 1141j) whose size does not exceed the size standard established by SBA for other similar agricultural small business concerns. A small agricultural cooperative's member shareholders are not considered to be affiliates of the cooperative by virtue of their membership in the cooperative. However, a business concern or cooperative that does not qualify as small under this part may not be a member of a small agricultural cooperative.

(b) A business concern may be in the legal form of an individual proprietorship, partnership, limited liability company, corporation, joint venture, association, trust or cooperative, except that where the form is a joint venture there can be no more than 49 percent participation by foreign business entities in the joint venture.

(c) A firm will not be treated as a separate business concern if a substantial portion of its assets and/or liabilities are the same as those of a predecessor entity. In such a case, the annual receipts and employees of the predecessor will be taken into account in determining size.

§ 121.106 How does SBA calculate number of employees?

(a) In determining a concern's number of employees, SBA counts all individuals employed on a full-time, part-time, or other basis. This includes employees obtained from a temporary employee agency, professional employee organization or leasing concern. SBA will consider the totality of the circumstances, including criteria used by the IRS for Federal income tax purposes, in determining whether individuals are employees of a concern. Volunteers ( i.e. , individuals who receive no compensation, including no in-kind compensation, for work performed) are not considered employees.

(b) Where the size standard is number of employees, the method for determining a concern's size includes the following principles:

(1) The average number of employees of the concern is used (including the employees of its domestic and foreign affiliates) based upon numbers of employees for each of the pay periods for the preceding completed 24 calendar months.

(2) Part-time and temporary employees are counted the same as full-time employees.

(3) If a concern has not been in business for 24 months, the average number of employees is used for each of the pay periods during which it has been in business.

(4)(i) The average number of employees of a business concern with affiliates is calculated by adding the average number of employees of the business concern with the average number of employees of each affiliate. If a concern has acquired an affiliate or been acquired as an affiliate during the applicable period of measurement or before the date on which it self-certified as small, the employees counted in determining size status include the employees of the acquired or acquiring concern. Furthermore, this aggregation applies for the entire period of measurement, not just the period after the affiliation arose.

(ii) The employees of a former affiliate are not counted if affiliation ceased before the date used for determining size. This exclusion of employees of a former affiliate applies during the entire period of measurement, rather than only for the period after which affiliation ceased. However, if a concern has sold a segregable division to another business concern during the applicable period of measurement or before the date on which it self-certified as small, the employees used in determining size status will continue to include the employees of the division that was sold.

§ 121.107 How does SBA determine a concern's “primary industry”?

In determining the primary industry in which a concern or a concern combined with its affiliates is engaged, SBA considers the distribution of receipts, employees and costs of doing business among the different industries in which business operations occurred for the most recently completed fiscal year. SBA may also consider other factors, such as the distribution of patents, contract awards, and assets.

§ 121.108 What are the penalties for misrepresentation of size status?

(a) Presumption of Loss Based on the Total Amount Expended. In every contract, subcontract, cooperative agreement, cooperative research and development agreement, or grant which is set aside, reserved, or otherwise classified as intended for award to small business concerns, there shall be a presumption of loss to the United States based on the total amount expended on the contract, subcontract, cooperative agreement, cooperative research and development agreement, or grant whenever it is established that a business concern other than a small business concern willfully sought and received the award by misrepresentation.

(b) Deemed Certifications. The following actions shall be deemed affirmative, willful and intentional certifications of small business size and status:

(1) Submission of a bid, proposal, application or offer for a Federal grant, contract, subcontract, cooperative agreement, or cooperative research and development agreement reserved, set aside, or otherwise classified as intended for award to small business concerns.

(2) Submission of a bid, proposal, application or offer for a Federal grant, contract, subcontract, cooperative agreement or cooperative research and development agreement which in any way encourages a Federal agency to classify the bid or proposal, if awarded, as an award to a small business concern.

(3) Registration on any Federal electronic database for the purpose of being considered for award of a Federal grant, contract, subcontract, cooperative agreement, or cooperative research and development agreement, as a small business concern.

(c) Signature Requirement. Each offer, proposal, bid, or application for a Federal contract, subcontract, or grant shall contain a certification concerning the small business size and status of a business concern seeking the Federal contract, subcontract or grant. An authorized official must sign the certification on the same page containing the size status claimed by the concern.

(d) Limitation of Liability. Paragraphs (a) through (c) of this section may be determined not to apply in the case of unintentional errors, technical malfunctions, and other similar situations that demonstrate that a misrepresentation of size was not affirmative, intentional, willful or actionable under the False Claims Act, 31 U.S.C. §§ 3729, et seq. A prime contractor acting in good faith should not be held liable for misrepresentations made by its subcontractors regarding the subcontractors' size. Relevant factors to consider in making this determination may include the firm's internal management procedures governing size representation or certification, the clarity or ambiguity of the representation or certification requirement, and the efforts made to correct an incorrect or invalid representation or certification in a timely manner. An individual or firm may not be held liable where government personnel have erroneously identified a concern as small without any representation or certification having been made by the concern and where such identification is made without the knowledge of the individual or firm.

(e) Penalties for Misrepresentation. (1) Suspension or debarment. The SBA suspension and debarment official or the agency suspension and debarment official may suspend or debar a person or concern for misrepresenting a firm's size status pursuant to the procedures set forth in 48 CFR subpart 9.4.

(2) Civil Penalties. Persons or concerns are subject to severe penalties under the False Claims Act, 31 U.S.C. 3729-3733, the Program Fraud Civil Remedies Act, 31 U.S.C. 3801-3812 and any other applicable laws or regulations, including 13 CFR part 142.

(3) Criminal Penalties. Persons or concerns are subject to severe criminal penalties for knowingly misrepresenting the small business size status of a concern in connection with procurement programs pursuant to section 16(d) of the Small Business Act, 15 U.S.C. 645(d), as amended, 18 U.S.C. 1001, 18 U.S.C. 287, and any other applicable laws. Persons or concerns are subject to criminal penalties for knowingly making false statements or misrepresentations to SBA for the purpose of influencing any actions of SBA pursuant to section 16(a) of the Small Business Act, 15 U.S.C. 645(a), as amended, including failure to correct “continuing representations” that are no longer true.

(4) Limitation on Liability. An individual or business concern will not be subject to the penalties imposed under 15 U.S.C. 645(a) where it acted in good faith reliance on a small business status advisory opinion accepted by SBA under § 121.109.

§ 121.109 What is a small business status advisory opinion?

(a) Defined. A small business status advisory opinion is a written opinion issued by either a Small Business Development Center (SBDC) operating under part 130 of this chapter or a Procurement Technical Assistance Center (PTAC) operating under 10 U.S.C. chapter 142 which concludes that a firm is entitled to represent itself as a small business concern for purposes of federal government procurement opportunities.

(b) Submission. An SBDC or PTAC must submit a copy of each small business status advisory opinion it issues to the following Agency official for review: Associate General Counsel, Office of Procurement Law, U.S. Small Business Administration, 409 Third Street SW., Washington, DC 20416 or by fax to [phone] marked Attn: Small Business Status Advisory Opinion. A small business status advisory opinion must:

(1) Provide a written analysis explaining the reasoning underlying the SBDC or PTAC's determination that the covered concern, along with its affiliates, either does or does not exceed the size standard(s). This analysis must be dated and signed by an SBDC or PTAC business counselor or similarly qualified individual.

(2) Include, as an attachment, a completed copy of an SBA Form 355 for the covered concern and its affiliates.

(3) Include, as an attachment, copies of the evidence (such as payroll records, time sheets, federal income tax returns, etc.) provided by the covered concern to the SBDC or PTAC clearly documenting its annual receipts and/or number of employees as those terms are defined by §§ 121.104 and 121.106.

(c) Review. Unless a referral is made under paragraph (e) of this section, SBA will decide within 10 business days of receiving a small business status advisory opinion to accept or reject it based on its consistency with part 121. SBA will provide written notification of that decision to the SBDC or PTAC that issued the small business status advisory opinion as well as to the covered concern.

(d) Reliance. A concern that receives a small business status advisory opinion holding that it does not exceed the applicable size standard(s) may rely upon that determination for purposes of responding to Federal procurement opportunities from the date it is issued unless and until that advisory opinion is rejected by SBA in accordance with paragraph (c) of this section or the concern undergoes a significant change in its ownership, management, or other factors bearing on its status as a small business concern. However, the firm's size may be protested by interested parties in connection with a specific procurement.

(e) Referral for size determination. Nothing in this section precludes the Associate General Counsel, Office of Procurement Law from requesting a formal size determination for a concern that is the subject of a small business status advisory opinion pursuant to § 121.1001(b)(9).

(f) Penalties for misrepresentation —(1) Suspension or debarment. The SBA suspension and debarment official may suspend or debar a person or concern for misrepresenting a concern's size for purposes of obtaining a small business size status advisory opinion pursuant to the procedures set forth in 48 CFR subpart 9.4.

(2) Civil penalties. Persons or concerns are subject to severe penalties under the False Claims Act, 31 U.S.C. 3729-3733, and under the Program Fraud Civil Remedies Act, 331 U.S.C. 3801-3812, and any other applicable laws.

(3) Criminal Penalties. Persons or concerns are subject to severe criminal penalties for knowingly misrepresenting the small business size status of a concern in connection with procurement programs pursuant to section 16(d) of the Small Business Act, 15 U.S.C. 645(d), as amended, 18 U.S.C. 1001, 18 U.S.C. 287, and any other applicable laws. Persons or concerns are subject to criminal penalties for knowingly making false statements or misrepresentations for the purpose of influencing any actions of SBA pursuant to section 16(a) of the Small Business Act, 15 U.S.C. 645(a), as amended, including failure to correct “continuing representations” that are no longer true.

§ 121.110 What must a concern do in order to be identified as a small business concern in any Federal procurement databases?

(a) In order to be identified as a small business concern in the System for Award Management (SAM) database (or any successor thereto), a concern must certify its size in connection with specific size standards at least annually.

(b) If a firm identified as a small business concern in SAM fails to certify its size within one year of a size certification, the firm will not be listed as a small business concern in SAM, unless and until the firm recertifies its size.

§ 121.201 What size standards has SBA identified by North American Industry Classification System codes?

The size standards described in this section apply to all SBA programs unless otherwise specified in this part. The size standards themselves are expressed either in number of employees or annual receipts in millions of dollars, unless otherwise specified. The number of employees or annual receipts indicates the maximum allowed for a concern and its affiliates to be considered small.

Small Business Size Standards by NAICS Industry

NAICS codes

NAICS U.S. industry title

Size standards in millions of dollars

Size standards in number of employees

Sector 11—Agriculture, Forestry, Fishing and Hunting

Subsector 111—Crop Production

111110

Soybean Farming

$2.25

111120

Oilseed (except Soybean) Farming

$2.25

111130

Dry Pea and Bean Farming

$2.75

111140

Wheat Farming

$2.25

111150

Corn Farming

$2.5

111160

Rice Farming

$2.5

111191

Oilseed and Grain Combination Farming

$2.25

111199

All Other Grain Farming

$2.25

111211

Potato Farming

$4.25

111219

Other Vegetable (except Potato) and Melon Farming

$3.75

111310

Orange Groves

$4.0

111320

Citrus (except Orange) Groves

$4.25

111331

Apple Orchards

$4.5

111332

Grape Vineyards

$4.0

111333

Strawberry Farming

$5.5

111334

Berry (except Strawberry) Farming

$3.75

111335

Tree Nut Farming

$3.75

111336

Fruit and Tree Nut Combination Farming

$5.0

111339

Other Noncitrus Fruit Farming

$3.5

111411

Mushroom Production

$4.5

111419

Other Food Crops Grown Under Cover

$4.5

111421

Nursery and Tree Production

$3.25

111422

Floriculture Production

$3.75

111910

Tobacco Farming

$2.5

111920

Cotton Farming

$3.25

111930

Sugarcane Farming

$5.0

111940

Hay Farming

$2.5

111991

Sugar Beet Farming

$2.5

111992

Peanut Farming

$2.5

111998

All Other Miscellaneous Crop Farming

$2.5

Subsector 112—Animal Production and Aquaculture

112111

Beef Cattle Ranching and Farming

$2.5

112112

Cattle Feedlots

$22.0

112120

Dairy Cattle and Milk Production

$3.75

112210

Hog and Pig Farming

$4.0

112310

Chicken Egg Production

$19.0

112320

Broilers and Other Meat Type Chicken Production

$3.5

112330

Turkey Production

$3.75

112340

Poultry Hatcheries

$4.0

112390

Other Poultry Production

$3.75

112410

Sheep Farming

$3.5

112420

Goat Farming

$2.5

112511

Finfish Farming and Fish Hatcheries

$3.75

112512

Shellfish Farming

$3.75

112519

Other Aquaculture

$3.75

112910

Apiculture

$3.25

112920

Horse and Other Equine Production

$2.75

112930

Fur-Bearing Animal and Rabbit Production

$3.75

112990

All Other Animal Production

$2.75

Subsector 113—Forestry and Logging

113110

Timber Tract Operations

$19.0

113210

Forest Nurseries and Gathering of Forest Products

$20.5

113310

Logging

500

Subsector 114—Fishing, Hunting and Trapping

114111

Finfish Fishing

$25.0

114112

Shellfish Fishing

$14.0

114119

Other Marine Fishing

$11.5

114210

Hunting and Trapping

$8.5

Subsector 115—Support Activities for Agriculture and Forestry

115111

Cotton Ginning

$16.0

115112

Soil Preparation, Planting, and Cultivating

$9.5

115113

Crop Harvesting, Primarily by Machine

$13.5

115114

Postharvest Crop Activities (except Cotton Ginning)

$34.0

115115

Farm Labor Contractors and Crew Leaders

$19.0

115116

Farm Management Services

$15.5

115210

Support Activities for Animal Production

$11.0

115310

Support Activities for Forestry

$11.5

115310 (Exception 1)

Forest Fire Suppression 1

$34.0 1

115310 (Exception 2)

Fuels Management Services 1

$34.0 1

Sector 21—Mining, Quarrying, and Oil and Gas Extraction

Subsector 211—Oil and Gas Extraction

211120

Crude Petroleum Extraction

1,250

211130

Natural Gas Extraction

1,250

Subsector 212—Mining (except Oil and Gas)

212114

Surface Coal Mining

1,250

212115

Underground Coal Mining

1,500

212210

Iron Ore Mining

1,400

212220

Gold Ore and Silver Ore Mining

1,500

212230

Copper, Nickel, Lead, and Zinc Mining

1,400

212290

Other Metal Ore Mining

1,250

212311

Dimension Stone Mining and Quarrying

500

212312

Crushed and Broken Limestone Mining and Quarrying

750

212313

Crushed and Broken Granite Mining and Quarrying

850

212319

Other Crushed and Broken Stone Mining and Quarrying

550

212321

Construction Sand and Gravel Mining

500

212322

Industrial Sand Mining

750

212323

Kaolin, Clay, and Ceramic and Refractory Minerals Mining

650

212390

Other Nonmetallic Mineral Mining and Quarrying

600

Subsector 213—Support Activities for Mining

213111

Drilling Oil and Gas Wells

1,000

213112

Support Activities for Oil and Gas Operations

$47.0

213113

Support Activities for Coal Mining

$27.5

213114

Support Activities for Metal Mining

$41.0

213115

Support Activities for Nonmetallic Minerals (except Fuels)

$20.5

Sector 22—Utilities

Subsector 221—Utilities

221111

Hydroelectric Power Generation

750

221112

Fossil Fuel Electric Power Generation

950

221113

Nuclear Electric Power Generation

1,150

221114

Solar Electric Power Generation

500

221115

Wind Electric Power Generation

1,150

221116

Geothermal Electric Power Generation

250

221117

Biomass Electric Power Generation

550

221118

Other Electric Power Generation

650

221121

Electric Bulk Power Transmission and Control

950

221122

Electric Power Distribution

1,100

221210

Natural Gas Distribution

1,150

221310

Water Supply and Irrigation Systems

$41.0

221320

Sewage Treatment Facilities

$35.0

221330

Steam and Air-Conditioning Supply

$30.0

Sector 23—Construction

Subsector 236—Construction of Buildings

236115

New Single-family Housing Construction (Except For-Sale Builders)

$45.0

236116

New Multifamily Housing Construction (except For-Sale Builders)

$45.0

236117

New Housing For-Sale Builders

$45.0

236118

Residential Remodelers

$45.0

236210

Industrial Building Construction

$45.0

236220

Commercial and Institutional Building Construction

$45.0

Subsector 237—Heavy and Civil Engineering Construction

237110

Water and Sewer Line and Related Structures Construction

$45.0

237120

Oil and Gas Pipeline and Related Structures Construction

$45.0

237130

Power and Communication Line and Related Structures Construction

$45.0

237210

Land Subdivision

$34.0

237310

Highway, Street, and Bridge Construction

$45.0

237990

Other Heavy and Civil Engineering Construction

$45.0

237900 (Exception)

Dredging and Surface Cleanup Activities 2

$37.0 2

Subsector 238—Specialty Trade Contractors

238110

Poured Concrete Foundation and Structure Contractors

$19.0

238120

Structural Steel and Precast Concrete Contractors

$19.0

238130

Framing Contractors

$19.0

238140

Masonry Contractors

$19.0

238150

Glass and Glazing Contractors

$19.0

238160

Roofing Contractors

$19.0

238170

Siding Contractors

$19.0

238190

Other Foundation, Structure, and Building Exterior Contractors

$19.0

238210

Electrical Contractors and Other Wiring Installation Contractors

$19.0

238220

Plumbing, Heating, and Air-Conditioning Contractors

$19.0

238290

Other Building Equipment Contractors

$22.0

238310

Drywall and Insulation Contractors

$19.0

238320

Painting and Wall Covering Contractors

$19.0

238330

Flooring Contractors

$19.0

238340

Tile and Terrazzo Contractors

$19.0

238350

Finish Carpentry Contractors

$19.0

238390

Other Building Finishing Contractors

$19.0

238910

Site Preparation Contractors

$19.0

238990

All Other Specialty Trade Contractors

$19.0

238990 (Exception)

Building and Property Specialty Trade Services 13

$19.0 13

Sectors 31-33—Manufacturing

Subsector 311—Food Manufacturing

311111

Dog and Cat Food Manufacturing

1,250

311119

Other Animal Food Manufacturing

650

311211

Flour Milling

1,050

311212

Rice Milling

750

311213

Malt Manufacturing

500

311221

Wet Corn Milling and Starch Manufacturing

1,300

311224

Soybean and Other Oilseed Processing

1,250

311225

Fats and Oils Refining and Blending

1,100

311230

Breakfast Cereal Manufacturing

1,300

311313

Beet Sugar Manufacturing

1,150

311314

Cane Sugar Manufacturing

1,050

311340

Nonchocolate Confectionery Manufacturing

1,000

311351

Chocolate and Confectionery Manufacturing from Cacao Beans

1,250

311352

Confectionery Manufacturing from Purchased Chocolate

1,000

311411

Frozen Fruit, Juice, and Vegetable Manufacturing

1,100

311412

Frozen Specialty Food Manufacturing

1,250

311421

Fruit and Vegetable Canning 3

1,000 3

311422

Specialty Canning

1,400

311423

Dried and Dehydrated Food Manufacturing

750

311511

Fluid Milk Manufacturing

1,150

311512

Creamery Butter Manufacturing

750

311513

Cheese Manufacturing

1,250

311514

Dry, Condensed, and Evaporated Dairy Product Manufacturing

1,000

311520

Ice Cream and Frozen Dessert Manufacturing

1,000

311611

Animal (except Poultry) Slaughtering

1,150

311612

Meat Processed from Carcasses

1,000

311613

Rendering and Meat Byproduct Processing

750

311615

Poultry Processing

1,250

311710

Seafood Product Preparation and Packaging

750

311811

Retail Bakeries

500

311812

Commercial Bakeries

1,000

311813

Frozen Cakes, Pies, and Other Pastries Manufacturing

750

311821

Cookie and Cracker Manufacturing

1,250

311824

Dry Pasta, Dough, and Flour Mixes Manufacturing from Purchased Flour

850

311830

Tortilla Manufacturing

1,250

311911

Roasted Nuts and Peanut Butter Manufacturing

750

311919

Other Snack Food Manufacturing

1,250

311920

Coffee and Tea Manufacturing

1,000

311930

Flavoring Syrup and Concentrate Manufacturing

1,100

311941

Mayonnaise, Dressing, and Other Prepared Sauce Manufacturing

850

311942

Spice and Extract Manufacturing

650

311991

Perishable Prepared Food Manufacturing

700

311999

All Other Miscellaneous Food Manufacturing

700

Subsector 312—Beverage and Tobacco Product Manufacturing

312111

Soft Drink Manufacturing

1,400

312112

Bottled Water Manufacturing

1,100

312113

Ice Manufacturing

750

312120

Breweries

1,250

312130

Wineries

1,000

312140

Distilleries

1,100

312230

Tobacco Manufacturing

1,500

Subsector 313—Textile Mills

313110

Fiber, Yarn, and Thread Mills

1,250

313210

Broadwoven Fabric Mills

1,000

313220

Narrow Fabric Mills and Schiffli Machine Embroidery

550

313230

Nonwoven Fabric Mills

850

313240

Knit Fabric Mills

500

313310

Textile and Fabric Finishing Mills

1,000

313320

Fabric Coating Mills

1,000

Subsector 314—Textile Product Mills

314110

Carpet and Rug Mills

1,500

314120

Curtain and Linen Mills

750

314910

Textile Bag and Canvas Mills

500

314994

Rope, Cordage, Twine, Tire Cord, and Tire Fabric Mills

1,000

314999

All Other Miscellaneous Textile Product Mills

550

Subsector 315—Apparel Manufacturing

315120

Apparel Knitting Mills

850

315210

Cut and Sew Apparel Contractors

750

315250

Cut and Sew Apparel Manufacturing (except Contractors)

750

315990

Apparel Accessories and Other Apparel Manufacturing

600

Subsector 316—Leather and Allied Product Manufacturing

316110

Leather and Hide Tanning and Finishing

800

316210

Footwear Manufacturing

1,000

316990

Other Leather and Allied Product Manufacturing

500

Subsector 321—Wood Product Manufacturing

321113

Sawmills

550

321114

Wood Preservation

550

321211

Hardwood Veneer and Plywood Manufacturing

600

321212

Softwood Veneer and Plywood Manufacturing

1,250

321215

Engineered Wood Member Manufacturing

500

321219

Reconstituted Wood Product Manufacturing

750

321911

Wood Window and Door Manufacturing

1,000

321912

Cut Stock, Resawing Lumber, and Planing

500

321918

Other Millwork (including Flooring)

500

321920

Wood Container and Pallet Manufacturing

500

321991

Manufactured Home (Mobile Home) Manufacturing

1,250

321992

Prefabricated Wood Building Manufacturing

500

321999

All Other Miscellaneous Wood Product Manufacturing

500

Subsector 322—Paper Manufacturing

322110

Pulp Mills

1,050

322120

Paper Mills

1,250

322130

Paperboard Mills

1,250

322211

Corrugated and Solid Fiber Box Manufacturing

1,250

322212

Folding Paperboard Box Manufacturing

750

322219

Other Paperboard Container Manufacturing

1,000

322220

Paper Bag and Coated and Treated Paper Manufacturing

750

322230

Stationery Product Manufacturing

750

322291

Sanitary Paper Product Manufacturing

1,500

322299

All Other Converted Paper Product Manufacturing

500

Subsector 323—Printing and Related Support Activities

323111

Commercial Printing (except Screen and Books)

650

323113

Commercial Screen Printing

500

323117

Books Printing

1,250

323120

Support Activities for Printing

550

Subsector 324—Petroleum and Coal Products Manufacturing

324110

Petroleum Refineries 4

1,500 4

324121

Asphalt Paving Mixture and Block Manufacturing

500

324122

Asphalt Shingle and Coating Materials Manufacturing

1,100

324191

Petroleum Lubricating Oil and Grease Manufacturing

900

324199

All Other Petroleum and Coal Products Manufacturing

950

Subsector 325—Chemical Manufacturing

325110

Petrochemical Manufacturing

1,300

325120

Industrial Gas Manufacturing

1,200

325130

Synthetic Dye and Pigment Manufacturing

1,050

325180

Other Basic Inorganic Chemical Manufacturing

1,000

325193

Ethyl Alcohol Manufacturing

1,000

325194

Cyclic Crude, Intermediate, and Gum and Wood Chemical Manufacturing

1,250

325199

All Other Basic Organic Chemical Manufacturing

1,250

325211

Plastics Material and Resin Manufacturing

1,250

325212

Synthetic Rubber Manufacturing

1,000

325220

Artificial and Synthetic Fibers and Filaments Manufacturing

1,050

325311

Nitrogenous Fertilizer Manufacturing

1,050

325312

Phosphatic Fertilizer Manufacturing

1,350

325314

Fertilizer (Mixing Only) Manufacturing

550

325315

Compost Manufacturing

550

325320

Pesticide and Other Agricultural Chemical Manufacturing

1,150

325411

Medicinal and Botanical Manufacturing

1,000

325412

Pharmaceutical Preparation Manufacturing

1,300

325413

In-Vitro Diagnostic Substance Manufacturing

1,250

325414

Biological Product (except Diagnostic) Manufacturing

1,250

325510

Paint and Coating Manufacturing

1,000

325520

Adhesive Manufacturing

550

325611

Soap and Other Detergent Manufacturing

1,100

325612

Polish and Other Sanitation Good Manufacturing

900

325613

Surface Active Agent Manufacturing

1,100

325620

Toilet Preparation Manufacturing

1,250

325910

Printing Ink Manufacturing

750

325920

Explosives Manufacturing

750

325991

Custom Compounding of Purchased Resins

600

325992

Photographic Film, Paper, Plate, Chemical, and Copy Toner Manufacturing

1,500

325998

All Other Miscellaneous Chemical Product and Preparation Manufacturing

650

Subsector 326—Plastics and Rubber Products Manufacturing

326111

Plastics Bag and Pouch Manufacturing

750

326112

Plastics Packaging Film and Sheet (including Laminated) Manufacturing

1,000

326113

Unlaminated Plastics Film and Sheet (except Packaging) Manufacturing

750

326121

Unlaminated Plastics Profile Shape Manufacturing

600

326122

Plastics Pipe and Pipe Fitting Manufacturing

750

326130

Laminated Plastics Plate, Sheet (except Packaging), and Shape Manufacturing

650

326140

Polystyrene Foam Product Manufacturing

1,000

326150

Urethane and Other Foam Product (except Polystyrene) Manufacturing

750

326160

Plastics Bottle Manufacturing

1,250

326191

Plastics Plumbing Fixture Manufacturing

750

326199

All Other Plastics Product Manufacturing

750

326211

Tire Manufacturing (except Retreading) 5

1,500 5

326212

Tire Retreading

500

326220

Rubber and Plastics Hoses and Belting Manufacturing

800

326291

Rubber Product Manufacturing for Mechanical Use

750

326299

All Other Rubber Product Manufacturing

650

Subsector 327—Nonmetallic Mineral Product Manufacturing

327110

Pottery, Ceramics, and Plumbing Fixture Manufacturing

1,000

327120

Clay Building Material and Refractories Manufacturing

750

327211

Flat Glass Manufacturing

1,100

327212

Other Pressed and Blown Glass and Glassware Manufacturing

1,250

327213

Glass Container Manufacturing

1,250

327215

Glass Product Manufacturing Made of Purchased Glass

1,000

327310

Cement Manufacturing

1,000

327320

Ready-Mix Concrete Manufacturing

500

327331

Concrete Block and Brick Manufacturing

500

327332

Concrete Pipe Manufacturing

750

327390

Other Concrete Product Manufacturing

500

327410

Lime Manufacturing

1,050

327420

Gypsum Product Manufacturing

1,500

327910

Abrasive Product Manufacturing

900

327991

Cut Stone and Stone Product Manufacturing

500

327992

Ground or Treated Mineral and Earth Manufacturing

600

327993

Mineral Wool Manufacturing

1,500

327999

All Other Miscellaneous Nonmetallic Mineral Product Manufacturing

750

Subsector 331—Primary Metal Manufacturing

331110

Iron and Steel Mills and Ferroalloy Manufacturing

1,500

331210

Iron and Steel Pipe and Tube Manufacturing from Purchased Steel

1,000

331221

Rolled Steel Shape Manufacturing

1,000

331222

Steel Wire Drawing

1,000

331313

Alumina Refining and Primary Aluminum Production

1,300

331314

Secondary Smelting and Alloying of Aluminum

750

331315

Aluminum Sheet, Plate, and Foil Manufacturing

1,400

331318

Other Aluminum Rolling, Drawing, and Extruding

750

331410

Nonferrous Metal (except Aluminum) Smelting and Refining

1,000

331420

Copper Rolling, Drawing, Extruding, and Alloying

1,050

331491

Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding

900

331492

Secondary Smelting, Refining, and Alloying of Nonferrous Metal (except Copper and Aluminum)

850

331511

Iron Foundries

1,000

331512

Steel Investment Foundries

1,050

331513

Steel Foundries (except Investment)

700

331523

Nonferrous Metal Die-Casting Foundries

700

331524

Aluminum Foundries (except Die-Casting)

550

331529

Other Nonferrous Metal Foundries (except Die-Casting)

500

Subsector 332—Fabricated Metal Product Manufacturing

332111

Iron and Steel Forging

750

332112

Nonferrous Forging

950

332114

Custom Roll Forming

600

332117

Powder Metallurgy Part Manufacturing

550

332119

Metal Crown, Closure, and Other Metal Stamping (except Automotive)

500

332215

Metal Kitchen Cookware, Utensil, Cutlery, and Flatware (except Precious) Manufacturing

1,000

332216

Saw Blade and Handtool Manufacturing

750

332311

Prefabricated Metal Building and Component Manufacturing

750

332312

Fabricated Structural Metal Manufacturing

500

332313

Plate Work Manufacturing

750

332321

Metal Window and Door Manufacturing

750

332322

Sheet Metal Work Manufacturing

500

332323

Ornamental and Architectural Metal Work Manufacturing

500

332410

Power Boiler and Heat Exchanger Manufacturing

750

332420

Metal Tank (Heavy Gauge) Manufacturing

750

332431

Metal Can Manufacturing

1,500

332439

Other Metal Container Manufacturing

600

332510

Hardware Manufacturing

750

332613

Spring Manufacturing

600

332618

Other Fabricated Wire Product Manufacturing

500

332710

Machine Shops

500

332721

Precision Turned Product Manufacturing

500

332722

Bolt, Nut, Screw, Rivet, and Washer Manufacturing

600

332811

Metal Heat Treating

750

332812

Metal Coating, Engraving (except Jewelry and Silverware), and Allied Services to Manufacturers

600

332813

Electroplating, Plating, Polishing, Anodizing and Coloring

500

332911

Industrial Valve Manufacturing

750

332912

Fluid Power Valve and Hose Fitting Manufacturing

1,000

332913

Plumbing Fixture Fitting and Trim Manufacturing

1,000

332919

Other Metal Valve and Pipe Fitting Manufacturing

750

332991

Ball and Roller Bearing Manufacturing

1,250

332992

Small Arms Ammunition Manufacturing

1,300

332993

Ammunition (except Small Arms) Manufacturing

1,500

332994

Small Arms, Ordnance, and Ordnance Accessories Manufacturing

1,000

332996

Fabricated Pipe and Pipe Fitting Manufacturing

550

332999

All Other Miscellaneous Fabricated Metal Product Manufacturing

750

Subsector 333—Machinery Manufacturing 6

333111

Farm Machinery and Equipment Manufacturing

1,250

333112

Lawn and Garden Tractor and Home Lawn and Garden Equipment Manufacturing

1,500

333120

Construction Machinery Manufacturing

1,250

333131

Mining Machinery and Equipment Manufacturing

900

333132

Oil and Gas Field Machinery and Equipment Manufacturing

1,250

333241

Food Product Machinery Manufacturing

500

333242

Semiconductor Machinery Manufacturing

1,500

333243

Sawmill, Woodworking, and Paper Machinery Manufacturing

550

333248

All Other Industrial Machinery Manufacturing

750

333310

Commercial and Service Industry Machinery Manufacturing

1,000

333413

Industrial and Commercial Fan and Blower and Air Purification Equipment Manufacturing

500

333414

Heating Equipment (except Warm Air Furnaces) Manufacturing

500

333415

Air-Conditioning and Warm Air Heating Equipment and Commercial and Industrial Refrigeration Equipment Manufacturing

1,250

333511

Industrial Mold Manufacturing

500

333514

Special Die and Tool, Die Set, Jig and Fixture Manufacturing

500

333515

Cutting Tool and Machine Tool Accessory Manufacturing

500

333517

Machine Tool Manufacturing

500

333519

Rolling Mill and Other Metalworking Machinery Manufacturing

500

333611

Turbine and Turbine Generator Set Units Manufacturing

1,500

333612

Speed Changer, Industrial High-Speed Drive, and Gear Manufacturing

750

333613

Mechanical Power Transmission Equipment Manufacturing

750

333618

Other Engine Equipment Manufacturing

1,500

333912

Air and Gas Compressor Manufacturing

1,000

333914

Measuring, Dispensing, and Other Pumping Equipment Manufacturing

750

333921

Elevator and Moving Stairway Manufacturing

1,000

333922

Conveyor and Conveying Equipment Manufacturing

500

333923

Overhead Traveling Crane, Hoist, and Monorail System Manufacturing

1,250

333924

Industrial Truck, Tractor, Trailer, and Stacker Machinery Manufacturing

900

333991

Power-Driven Hand Tool Manufacturing

950

333992

Welding and Soldering Equipment Manufacturing

1,250

333993

Packaging Machinery Manufacturing

600

333994

Industrial Process Furnace and Oven Manufacturing

500

333995

Fluid Power Cylinder and Actuator Manufacturing

800

333996

Fluid Power Pump and Motor Manufacturing

1,250

333998

All Other Miscellaneous General Purpose Machinery Manufacturing

700

Subsector 334—Computer and Electronic Product Manufacturing 6

334111

Electronic Computer Manufacturing

1,250

334112

Computer Storage Device Manufacturing

1,250

334118

Computer Terminal and Other Computer Peripheral Equipment Manufacturing

1,000

334210

Telephone Apparatus Manufacturing

1,250

334220

Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing

1,250

334290

Other Communications Equipment Manufacturing

800

334310

Audio and Video Equipment Manufacturing

750

334412

Bare Printed Circuit Board Manufacturing

750

334413

Semiconductor and Related Device Manufacturing

1,250

334416

Capacitor, Resistor, Coil, Transformer, and Other Inductor Manufacturing

550

334417

Electronic Connector Manufacturing

1,000

334418

Printed Circuit Assembly (Electronic Assembly) Manufacturing

750

334419

Other Electronic Component Manufacturing

750

334510

Electromedical and Electrotherapeutic Apparatus Manufacturing

1,250

334511

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

1,350

334512

Automatic Environmental Control Manufacturing for Residential, Commercial, and Appliance Use

650

334513

Instruments and Related Products Manufacturing for Measuring, Displaying, and Controlling Industrial Process Variables

750

334514

Totalizing Fluid Meter and Counting Device Manufacturing

850

334515

Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals

750

334516

Analytical Laboratory Instrument Manufacturing

1,000

334517

Irradiation Apparatus Manufacturing

1,200

334519

Other Measuring and Controlling Device Manufacturing

600

334610

Manufacturing and Reproducing Magnetic and Optical Media

1,250

Subsector 335—Electrical Equipment, Appliance and Component Manufacturing 6

335131

Residential Electric Lighting Fixture Manufacturing

750

335132

Commercial, Industrial, and Institutional Electric Lighting Fixture Manufacturing

600

335139

Electric Lamp Bulb and Other Lighting Equipment Manufacturing

1,250

335210

Small Electrical Appliance Manufacturing

1,500

335220

Major Household Appliance Manufacturing

1,500

335311

Power, Distribution, and Specialty Transformer Manufacturing

800

335312

Motor and Generator Manufacturing

1,250

335313

Switchgear and Switchboard Apparatus Manufacturing

1,250

335314

Relay and Industrial Control Manufacturing

750

335910

Battery Manufacturing

1,250

335921

Fiber Optic Cable Manufacturing

1,000

335929

Other Communication and Energy Wire Manufacturing

1,000

335931

Current-Carrying Wiring Device Manufacturing

600

335932

Noncurrent-Carrying Wiring Device Manufacturing

1,000

335991

Carbon and Graphite Product Manufacturing

900

335999

All Other Miscellaneous Electrical Equipment and Component Manufacturing

600

Subsector 336—Transportation Equipment Manufacturing 6

336110

Automobile and Light Duty Motor Vehicle Manufacturing

1,500

336120

Heavy Duty Truck Manufacturing

1,500

336211

Motor Vehicle Body Manufacturing

1,000

336212

Truck Trailer Manufacturing

1,000

336213

Motor Home Manufacturing

1,250

336214

Travel Trailer and Camper Manufacturing

1,000

336310

Motor Vehicle Gasoline Engine and Engine Parts Manufacturing

1,050

336320

Motor Vehicle Electrical and Electronic Equipment Manufacturing

1,000

336330

Motor Vehicle Steering and Suspension Components (except Spring) Manufacturing

1,000

336340

Motor Vehicle Brake System Manufacturing

1,250

336350

Motor Vehicle Transmission and Power Train Parts Manufacturing

1,500

336360

Motor Vehicle Seating and Interior Trim Manufacturing

1,500

336370

Motor Vehicle Metal Stamping

1,000

336390

Other Motor Vehicle Parts Manufacturing

1,000

336411

Aircraft Manufacturing

1,500

336412

Aircraft Engine and Engine Parts Manufacturing

1,500

336413

Other Aircraft Parts and Auxiliary Equipment Manufacturing 7

1,250 7

336414

Guided Missile and Space Vehicle Manufacturing

1,300

336415

Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing

1,250

336419

Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing

1,050

336510

Railroad Rolling Stock Manufacturing

1,500

336611

Ship Building and Repairing

1,300

336612

Boat Building

1,000

336991

Motorcycle, Bicycle, and Parts Manufacturing

1,050

336992

Military Armored Vehicle, Tank, and Tank Component Manufacturing

1,500

336999

All Other Transportation Equipment Manufacturing

1,000

Subsector 337—Furniture and Related Product Manufacturing

337110

Wood Kitchen Cabinet and Countertop Manufacturing

750

337121

Upholstered Household Furniture Manufacturing

1,000

337122

Nonupholstered Wood Household Furniture Manufacturing

750

337126

Household Furniture (except Wood and Upholstered) Manufacturing

950

337127

Institutional Furniture Manufacturing

500

337211

Wood Office Furniture Manufacturing

1,000

337212

Custom Architectural Woodwork and Millwork Manufacturing

500

337214

Office Furniture (except Wood) Manufacturing

1,100

337215

Showcase, Partition, Shelving, and Locker Manufacturing

500

337910

Mattress Manufacturing

1,000

337920

Blind and Shade Manufacturing

1,000

Subsector 339—Miscellaneous Manufacturing

339112

Surgical and Medical Instrument Manufacturing

1,000

339113

Surgical Appliance and Supplies Manufacturing

800

339114

Dental Equipment and Supplies Manufacturing

750

339115

Ophthalmic Goods Manufacturing

1,000

339116

Dental Laboratories

500

339910

Jewelry and Silverware Manufacturing

700

339920

Sporting and Athletic Goods Manufacturing

750

339930

Doll, Toy, and Game Manufacturing

700

339940

Office Supplies (except Paper) Manufacturing

750

339950

Sign Manufacturing

500

339991

Gasket, Packing, and Sealing Device Manufacturing

600

339992

Musical Instrument Manufacturing

1,000

339993

Fastener, Button, Needle, and Pin Manufacturing

750

339994

Broom, Brush, and Mop Manufacturing

750

339995

Burial Casket Manufacturing

1,000

339999

All Other Miscellaneous Manufacturing

550

Sector 42—Wholesale Trade

(These NAICS codes shall not be used to classify Government acquisitions for supplies. They also shall not be used by Federal Government contractors when subcontracting for the acquisition for supplies. The applicable manufacturing NAICS code shall be used to classify acquisitions for supplies. A Wholesale Trade or Retail Trade business concern submitting an offer or a quote on a supply acquisition is categorized as a nonmanufacturer and deemed small if it has 500 or fewer employees and meets the requirements of 13 CFR 121.406.)

Subsector 423—Merchant Wholesalers, Durable Goods

423110

Automobile and Other Motor Vehicle Merchant Wholesalers

250

423120

Motor Vehicle Supplies and New Parts Merchant Wholesalers

200

423130

Tire and Tube Merchant Wholesalers

200

423140

Motor Vehicle Parts (Used) Merchant Wholesalers

125

423210

Furniture Merchant Wholesalers

100

423220

Home Furnishing Merchant Wholesalers

100

423310

Lumber, Plywood, Millwork, and Wood Panel Merchant Wholesalers

150

423320

Brick, Stone, and Related Construction Material Merchant Wholesalers

150

423330

Roofing, Siding, and Insulation Material Merchant Wholesalers

225

423390

Other Construction Material Merchant Wholesalers

100

423410

Photographic Equipment and Supplies Merchant Wholesalers

200

423420

Office Equipment Merchant Wholesalers

200

423430

Computer and Computer Peripheral Equipment and Software Merchant Wholesalers

250

423440

Other Commercial Equipment Merchant Wholesalers

100

423450

Medical, Dental, and Hospital Equipment and Supplies Merchant Wholesalers

200

423460

Ophthalmic Goods Merchant Wholesalers

175

423490

Other Professional Equipment and Supplies Merchant Wholesalers

150

423510

Metal Service Centers and Other Metal Merchant Wholesalers

200

423520

Coal and Other Mineral and Ore Merchant Wholesalers

200

423610

Electrical Apparatus and Equipment, Wiring Supplies, and Related Equipment Merchant Wholesalers

200

423620

Household Appliances, Electric Housewares, and Consumer Electronics Merchant Wholesalers

225

423690

Other Electronic Parts and Equipment Merchant Wholesalers

250

423710

Hardware Merchant Wholesalers

150

423720

Plumbing and Heating Equipment and Supplies (Hydronics) Merchant Wholesalers

200

423730

Warm Air Heating and Air-Conditioning Equipment and Supplies Merchant Wholesalers

175

423740

Refrigeration Equipment and Supplies Merchant Wholesalers

125

423810

Construction and Mining (except Oil Well) Machinery and Equipment Merchant Wholesalers

250

423820

Farm and Garden Machinery and Equipment Merchant Wholesalers

125

423830

Industrial Machinery and Equipment Merchant Wholesalers

100

423840

Industrial Supplies Merchant Wholesalers

125

423850

Service Establishment Equipment and Supplies Merchant Wholesalers

125

423860

Transportation Equipment and Supplies (except Motor Vehicle) Merchant Wholesalers

175

423910

Sporting and Recreational Goods and Supplies Merchant Wholesalers

100

423920

Toy and Hobby Goods and Supplies Merchant Wholesalers

175

423930

Recyclable Material Merchant Wholesalers

125

423940

Jewelry, Watch, Precious Stone, and Precious Metal Merchant Wholesalers

125

423990

Other Miscellaneous Durable Goods Merchant Wholesalers

100

Subsector 424—Merchant Wholesalers, Nondurable Goods

424110

Printing and Writing Paper Merchant Wholesalers

225

424120

Stationery and Office Supplies Merchant Wholesalers

150

424130

Industrial and Personal Service Paper Merchant Wholesalers

150

424210

Drugs and Druggists' Sundries Merchant Wholesalers

250

424310

Piece Goods, Notions, and Other Dry Goods Merchant Wholesalers

100

424340

Footwear Merchant Wholesalers

200

424350

Clothing and Clothing Accessories Merchant Wholesalers

150

424410

General Line Grocery Merchant Wholesalers

250

424420

Packaged Frozen Food Merchant Wholesalers

200

424430

Dairy Product (except Dried or Canned) Merchant Wholesalers

200

424440

Poultry and Poultry Product Merchant Wholesalers

150

424450

Confectionery Merchant Wholesalers

225

424460

Fish and Seafood Merchant Wholesalers

100

424470

Meat and Meat Product Merchant Wholesalers

150

424480

Fresh Fruit and Vegetable Merchant Wholesalers

100

424490

Other Grocery and Related Products Merchant Wholesalers

250

424510

Grain and Field Bean Merchant Wholesalers

200

424520

Livestock Merchant Wholesalers

125

424590

Other Farm Product Raw Material Merchant Wholesalers

175

424610

Plastics Materials and Basic Forms and Shapes Merchant Wholesalers

150

424690

Other Chemical and Allied Products Merchant Wholesalers

175

424710

Petroleum Bulk Stations and Terminals

225

424720

Petroleum and Petroleum Products Merchant Wholesalers (except Bulk Stations and Terminals)

200

424810

Beer and Ale Merchant Wholesalers

200

424820

Wine and Distilled Alcoholic Beverage Merchant Wholesalers

250

424910

Farm Supplies Merchant Wholesalers

200

424920

Book, Periodical, and Newspaper Merchant Wholesalers

200

424930

Flower, Nursery Stock, and Florists' Supplies Merchant Wholesalers

100

424940

Tobacco Product and Electronic Cigarette Merchant Wholesalers

250

424950

Paint, Varnish, and Supplies Merchant Wholesalers

150

424990

Other Miscellaneous Nondurable Goods Merchant Wholesalers

100

Subsector 425—Wholesale Trade Agents and Brokers

425120

Wholesale Trade Agents and Brokers

125

Sector 44-45—Retail Trade

(These NAICS codes shall not be used to classify Government acquisitions for supplies. They also shall not be used by Federal Government contractors when subcontracting for the acquisition for supplies. The applicable manufacturing NAICS code shall be used to classify acquisitions for supplies. A Wholesale Trade or Retail Trade business concern submitting an offer or a quote on a supply acquisition is categorized as a nonmanufacturer and deemed small if it has 500 or fewer employees and meets the requirements of 13 CFR 121.406.)

Subsector 441—Motor Vehicle and Parts Dealers

441110

New Car Dealers

200

441120

Used Car Dealers

$30.5

441210

Recreational Vehicle Dealers

$40.0

441222

Boat Dealers

$40.0

441227

Motorcycle, ATV, and All Other Motor Vehicle Dealers

$40.0

441330

Automotive Parts and Accessories Retailers

$28.5

441340

Tire Dealers

$25.5

Subsector 444—Building Material and Garden Equipment and Supplies Dealers

444110

Home Centers

$47.0

444120

Paint and Wallpaper Retailers

$34.0

444140

Hardware Retailers

$16.5

444180

Other Building Material Dealers

$25.0

444230

Outdoor Power Equipment Retailers

$9.5

444240

Nursery, Garden Center, and Farm Supply Retailers

$21.5

Subsector 445—Food and Beverage Stores

445110

Supermarkets and Other Grocery Retailers (except Convenience Retailers)

$40.0

445131

Convenience Retailers

$36.5

445132

Vending Machine Operators

$21.0

445230

Fruit and Vegetable Retailers

$9.0

445240

Meat Retailers

$9.0

445250

Fish and Seafood Retailers

$9.0

445291

Baked Goods Retailers

$16.0

445292

Confectionery and Nut Retailers

$19.5

445298

All Other Specialty Food Retailers

$10.0

445320

Beer, Wine, and Liquor Retailers

$10.0

Subsector 449—Furniture, Home Furnishings, Electronics, and Appliance Retailers

449110

Furniture Retailers

$25.0

449121

Floor Covering Retailers

$9.0

449122

Window Treatment Retailers

$11.5

449129

All Other Home Furnishings Retailers

$33.5

449210

Electronics and Appliance Retailers

$40.0

Subsector 455—General Merchandise Retailers

455110

Department Stores

$40.0

455211

Warehouse Clubs and Supercenters

$47.0

455219

All Other General Merchandise Retailers

$40.0

Subsector 456—Health and Personal Care Retailers

456110

Pharmacies and Drug Retailers

$37.5

456120

Cosmetics, Beauty Supplies, and Perfume Retailers

$34.0

456130

Optical Goods Retailers

$29.5

456191

Food (Health) Supplement Retailers

$22.5

456199

All Other Health and Personal Care Retailers

$9.5

Subsector 457—Gasoline Stations and Fuel Dealers

457110

Gasoline Stations with Convenience Stores

$36.5

457120

Other Gasoline Stations

$33.5

457210

Fuel Dealers

100

Subsector 458—Clothing, Clothing Accessories, Shoe, and Jewelry Retailers

458110

Clothing and Clothing Accessories Retailers

$47.0

458210

Shoe Retailers

$34.0

458310

Jewelry Retailers

$20.5

458320

Luggage and Leather Goods Retailers

$38.0

Subsector 459—Sporting Goods, Hobby, Musical Instrument, Book, and Miscellaneous Retailers

459110

Sporting Goods Retailers

$26.5

459120

Hobby, Toy, and Game Retailers

$35.0

459130

Sewing, Needlework, and Piece Goods Retailers

$34.0

459140

Musical Instrument and Supplies Retailers

$22.5

459210

Book Retailers and News Dealers

$36.0

459310

Florists

$9.0

459410

Office Supplies and Stationery Retailers

$40.0

459420

Gift, Novelty, and Souvenir Retailers

$13.5

459510

Used Merchandise Retailers

$14.0

459910

Pet and Pet Supplies Retailers

$32.0

459920

Art Dealers

$16.5

459930

Manufactured (Mobile) Home Dealers

$19.0

459991

Tobacco, Electronic Cigarette, and Other Smoking Supplies Retailers

$11.5

459999

All Other Miscellaneous Retailers

$11.5

Sectors 48-49—Transportation and Warehousing

Subsector 481—Air Transportation

481111

Scheduled Passenger Air Transportation

1,500

481112

Scheduled Freight Air Transportation

1,500

481211

Nonscheduled Chartered Passenger Air Transportation

1,500

481212

Nonscheduled Chartered Freight Air Transportation

1,500

481219

Other Nonscheduled Air Transportation

$25.0

Subsector 482—Rail Transportation

482111

Line-Haul Railroads

1,500

482112

Short Line Railroads

1,500

Subsector 483—Water Transportation

483111

Deep Sea Freight Transportation

1,050

483112

Deep Sea Passenger Transportation

1,500

483113

Coastal and Great Lakes Freight Transportation

800

483114

Coastal and Great Lakes Passenger Transportation

550

483211

Inland Water Freight Transportation

1,050

483212

Inland Water Passenger Transportation

550

Subsector 484—Truck Transportation

484110

General Freight Trucking, Local

$34.0

484121

General Freight Trucking, Long-Distance, Truckload

$34.0

484122

General Freight Trucking, Long-Distance, Less Than Truckload

$43.0

484210

Used Household and Office Goods Moving

$34.0

484220

Specialized Freight (except Used Goods) Trucking, Local

$34.0

484230

Specialized Freight (except Used Goods) Trucking, Long-Distance

$34.0

Subsector 485—Transit and Ground Passenger Transportation

485111

Mixed Mode Transit Systems

$29.0

485112

Commuter Rail Systems

$47.0

485113

Bus and Other Motor Vehicle Transit Systems

$32.5

485119

Other Urban Transit Systems

$37.5

485210

Interurban and Rural Bus Transportation

$32.0

485310

Taxi and Ridesharing Services

$19.0

485320

Limousine Service

$19.0

485410

School and Employee Bus Transportation

$30.0

485510

Charter Bus Industry

$19.0

485991

Special Needs Transportation

$19.0

485999

All Other Transit and Ground Passenger Transportation

$19.0

Subsector 486—Pipeline Transportation

486110

Pipeline Transportation of Crude Oil

1,500

486210

Pipeline Transportation of Natural Gas

$41.5

486910

Pipeline Transportation of Refined Petroleum Products

1,500

486990

All Other Pipeline Transportation

$46.0

Subsector 487—Scenic and Sightseeing Transportation

487110

Scenic and Sightseeing Transportation, Land

$20.5

487210

Scenic and Sightseeing Transportation, Water

$14.0

487990

Scenic and Sightseeing Transportation, Other

$25.0

Subsector 488—Support Activities for Transportation

488111

Air Traffic Control

$40.0

488119

Other Airport Operations

$40.0

488190

Other Support Activities for Air Transportation

$40.0

488210

Support Activities for Rail Transportation

$34.0

488310

Port and Harbor Operations

$47.0

488320

Marine Cargo Handling

$47.0

488330

Navigational Services to Shipping

$47.0

488390

Other Support Activities for Water Transportation

$47.0

488410

Motor Vehicle Towing

$9.0

488490

Other Support Activities for Road Transportation

$18.0

488510

Freight Transportation Arrangement 10

$20.0 10

488510 (Exception)

Non-Vessel Owning Common Carriers and Household Goods Forwarders

$34.0

488991

Packing and Crating

$34.0

488999

All Other Support Activities for Transportation

$25.0

Subsector 491—Postal Service

491110

Postal Service

$9.0

Subsector 492—Couriers and Messengers

492110

Couriers and Express Delivery Services

1,500

492210

Local Messengers and Local Delivery

$34.0

Subsector 493—Warehousing and Storage

493110

General Warehousing and Storage

$34.0

493120

Refrigerated Warehousing and Storage

$36.5

493130

Farm Product Warehousing and Storage

$34.0

493190

Other Warehousing and Storage

$36.5

Sector 51—Information

Subsector 512—Motion Picture and Sound Recording Industries

512110

Motion Picture and Video Production

$40.0

512120

Motion Picture and Video Distribution

$39.0

512131

Motion Picture Theaters (except Drive-Ins)

$47.0

512132

Drive-In Motion Picture Theaters

$12.5

512191

Teleproduction and Other Postproduction Services

$39.0

512199

Other Motion Picture and Video Industries

$28.5

512230

Music Publishers

900

512240

Sound Recording Studios

$11.0

512250

Record Production and Distribution

900

512290

Other Sound Recording Industries

$22.5

Subsector 513—Publishing Industries

513110

Newspaper Publishers

1,000

513120

Periodical Publishers

1,000

513130

Book Publishers

1,000

513140

Directory and Mailing List Publishers

1,000

513191

Greeting Card Publishers

1,000

513199

All Other Publishers

1,000

513210

Software Publishers 15

$47.0 15

Subsector 516—Broadcasting and Content Providers

516110

Radio Broadcasting Stations

$47.0

516120

Television Broadcasting Stations

$47.0

516210

Media Streaming Distribution Services, Social Networks, and Other Media Networks and Content Providers

$47.0

Subsector 517—Telecommunications

517111

Wired Telecommunications Carriers

1,500

517112

Wireless Telecommunications Carriers (except Satellite)

1,500

517121

Telecommunications Resellers

1,500

517122

Agents for Wireless Telecommunications Services

1,500

517410

Satellite Telecommunications

$44.0

517810

All Other Telecommunications

$40.0

Subsector 518—Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services

518210

Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services

$40.0

Subsector 519—Web Search Portals, Libraries, Archives, and Other Information Services

519210

Libraries and Archives

$21.0

519290

Web Search Portals and All Other Information Services

1,000

Sector 52—Finance and Insurance

Subsector 522—Credit Intermediation and Related Activities

522110

Commercial Banking 8

$850 million in assets 8

522130

Credit Unions 8

$850 million in assets 8

522180

Savings Institutions and Other Depository Credit Intermediation 8

$850 million in assets 8

522210

Credit Card Issuing 8

$850 million in assets 8

522220

Sales Financing

$47.0

522291

Consumer Lending

$47.0

522292

Real Estate Credit

$47.0

522299

International, Secondary Market, and All Other Nondepository Credit Intermediation

$47.0

522310

Mortgage and Nonmortgage Loan Brokers

$15.0

522320

Financial Transactions Processing, Reserve, and Clearinghouse Activities

$47.0

522390

Other Activities Related to Credit Intermediation

$28.5

Subsector 523—Securities, Commodity Contracts, and Other Financial Investments and Related Activities

523150

Investment Banking and Securities Intermediation

$47.0

523160

Commodity Contracts Intermediation

$41.5

523210

Securities and Commodity Exchanges

$47.0

523910

Miscellaneous Intermediation

$47.0

523940

Portfolio Management and Investment Advice

$47.0

523991

Trust, Fiduciary and Custody Activities

$47.0

523999

Miscellaneous Financial Investment Activities

$47.0

Subsector 524—Insurance Carriers and Related Activities

524113

Direct Life Insurance Carriers

$47.0

524114

Direct Health and Medical Insurance Carriers

$47.0

524126

Direct Property and Casualty Insurance Carriers

1,500

524127

Direct Title Insurance Carriers

$47.0

524128

Other Direct Insurance (except Life, Health and Medical) Carriers

$47.0

524130

Reinsurance Carriers

$47.0

524210

Insurance Agencies and Brokerages

$15.0

524291

Claims Adjusting

$25.0

524292

Pharmacy Benefit Management and Other Third Party Administration of Insurance and Pension Funds

$45.5

524298

All Other Insurance Related Activities

$30.5

Subsector 525—Funds, Trusts and Other Financial Vehicles

525110

Pension Funds

$40.0

525120

Health and Welfare Funds

$40.0

525190

Other Insurance Funds

$40.0

525910

Open-End Investment Funds

$40.0

525920

Trusts, Estates, and Agency Accounts

$40.0

525990

Other Financial Vehicles

$40.0

Sector 53—Real Estate and Rental and Leasing

Subsector 531—Real Estate

531110

Lessors of Residential Buildings and Dwellings 9

$34.0 9

531120

Lessors of Nonresidential Buildings (except Miniwarehouses) 9

$34.0 9

531130

Lessors of Miniwarehouses and Self-Storage Units 9

$34.0 9

531190

Lessors of Other Real Estate Property 9

$34.0 9

531210

Offices of Real Estate Agents and Brokers 10

$15.0 10

531311

Residential Property Managers

$12.5

531312

Nonresidential Property Managers

$19.5

531320

Offices of Real Estate Appraisers

$9.5

531390

Other Activities Related to Real Estate

$19.5

Subsector 532—Rental and Leasing Services

532111

Passenger Car Rental

$47.0

532112

Passenger Car Leasing

$47.0

532120

Truck, Utility Trailer, and RV (Recreational Vehicle) Rental and Leasing

$47.0

532210

Consumer Electronics and Appliances Rental

$47.0

532281

Formal Wear and Costume Rental

$25.0

532282

Video Tape and Disc Rental

$35.0

532283

Home Health Equipment Rental

$41.0

532284

Recreational Goods Rental

$9.0

532289

All Other Consumer Goods Rental

$12.5

532310

General Rental Centers

$9.0

532411

Commercial Air, Rail, and Water Transportation Equipment Rental and Leasing

$45.5

532412

Construction, Mining and Forestry Machinery and Equipment Rental and Leasing

$40.0

532420

Office Machinery and Equipment Rental and Leasing

$40.0

532490

Other Commercial and Industrial Machinery and Equipment Rental and Leasing

$40.0

Subsector 533—Lessors of Nonfinancial Intangible Assets (except Copyrighted Works)

533110

Lessors of Nonfinancial Intangible Assets (except Copyrighted Works)

$47.0

Sector 54—Professional, Scientific and Technical Services

Subsector 541—Professional, Scientific and Technical Services

541110

Offices of Lawyers

$15.5

541191

Title Abstract and Settlement Offices

$19.5

541199

All Other Legal Services

$20.5

541211

Offices of Certified Public Accountants

$26.5

541213

Tax Preparation Services

$25.0

541214

Payroll Services

$39.0

541219

Other Accounting Services

$25.0

541310

Architectural Services

$12.5

541320

Landscape Architectural Services

$9.0

541330

Engineering Services

$25.5

541330 (Exception 1)

Military and Aerospace Equipment and Military Weapons

$47.0

541330 (Exception 2)

Contracts and Subcontracts for Engineering Services Awarded Under the National Energy Policy Act of 1992

$47.0

541330 (Exception 3)

Marine Engineering and Naval Architecture

$47.0

541340

Drafting Services

$9.0

541350

Building Inspection Services

$11.5

541360

Geophysical Surveying and Mapping Services

$28.5

541370

Surveying and Mapping (except Geophysical) Services

$19.0

541380

Testing Laboratories and Services

$19.0

541410

Interior Design Services

$9.0

541420

Industrial Design Services

$17.0

541430

Graphic Design Services

$9.0

541490

Other Specialized Design Services

$13.5

541511

Custom Computer Programming Services

$34.0

541512

Computer Systems Design Services

$34.0

541513

Computer Facilities Management Services

$37.0

541519

Other Computer Related Services

$34.0

541519 (Exception)

Information Technology Value Added Resellers 18

150 18

541611

Administrative Management and General Management Consulting Services

$24.5

541612

Human Resources Consulting Services

$29.0

541613

Marketing Consulting Services

$19.0

541614

Process, Physical Distribution and Logistics Consulting Services

$20.0

541618

Other Management Consulting Services

$19.0

541620

Environmental Consulting Services

$19.0

541690

Other Scientific and Technical Consulting Services

$19.0

541713

Research and Technology in Nanotechnology 11

1,000 11

541714

Research and Technology in Biotechnology (except Nanobiotechnology) 11

1,000 11

541715

Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology) 11

11 1,000

541715 (Exception 1)

Aircraft, Aircraft Engine and Engine Parts 11

11 1,500

541715 (Exception 2)

Other Aircraft Parts and Auxiliary Equipment 11

11 1,250

541715 (Exception 3)

Guided Missiles and Space Vehicles, Their Propulsion Units and Propulsion Parts 11

11 1,300

541720

Research and Development in the Social Sciences and Humanities

$28.0

541810

Advertising Agencies 10

$25.5 10

541820

Public Relations Agencies

$19.0

541830

Media Buying Agencies

$32.5

541840

Media Representatives

$21.0

541850

Indoor and Outdoor Display Advertising

$34.5

541860

Direct Mail Advertising

$22.0

541870

Advertising Material Distribution Services

$28.5

541890

Other Services Related to Advertising

$19.0

541910

Marketing Research and Public Opinion Polling

$22.5

541921

Photography Studios, Portrait

$16.0

541922

Commercial Photography

$9.0

541930

Translation and Interpretation Services

$22.5

541940

Veterinary Services

$10.0

541990

All Other Professional, Scientific and Technical Services

$19.5

Sector 55—Management of Companies and Enterprises

Subsector 551—Management of Companies and Enterprises

551111

Offices of Bank Holding Companies

$38.5

551112

Offices of Other Holding Companies

$45.5

Sector 56—Administrative and Support and Waste Management and Remediation Services

Subsector 561—Administrative and Support Services

561110

Office Administrative Services

$12.5

561210

Facilities Support Services 12

$47.0 12

561311

Employment Placement Agencies

$34.0

561312

Executive Search Services

$34.0

561320

Temporary Help Services

$34.0

561330

Professional Employer Organizations

$41.5

561410

Document Preparation Services

$19.0

561421

Telephone Answering Services

$19.0

561422

Telemarketing Bureaus and Other Contact Centers

$25.5

561431

Private Mail Centers

$19.0

561439

Other Business Service Centers (including Copy Shops)

$26.5

561440

Collection Agencies

$19.5

561450

Credit Bureaus

$41.0

561491

Repossession Services

$19.0

561492

Court Reporting and Stenotype Services

$19.0

561499

All Other Business Support Services

$21.5

561510

Travel Agencies 10

$25.0 10

561520

Tour Operators 10

$25.0 10

561591

Convention and Visitors Bureaus

$25.0

561599

All Other Travel Arrangement and Reservation Services

$32.5

561611

Investigation and Personal Background Check Services

$25.0

561612

Security Guards and Patrol Services

$29.0

561613

Armored Car Services

$43.0

561621

Security Systems Services (except Locksmiths)

$25.0

561622

Locksmiths

$25.0

561710

Exterminating and Pest Control Services

$17.5

561720

Janitorial Services

$22.0

561730

Landscaping Services

$9.5

561740

Carpet and Upholstery Cleaning Services

$8.5

561790

Other Services to Buildings and Dwellings

$9.0

561910

Packaging and Labeling Services

$19.5

561920

Convention and Trade Show Organizers 10

$20.0 10

561990

All Other Support Services

$16.5

Subsector 562—Waste Management and Remediation Services

562111

Solid Waste Collection

$47.0

562112

Hazardous Waste Collection

$47.0

562119

Other Waste Collection

$47.0

562211

Hazardous Waste Treatment and Disposal

$47.0

562212

Solid Waste Landfill

$47.0

562213

Solid Waste Combustors and Incinerators

$47.0

562219

Other Nonhazardous Waste Treatment and Disposal

$47.0

562910

Remediation Services

$25.0

562910 (Exception)

Environmental Remediation Services 14

14 1,000

562920

Materials Recovery Facilities

$25.0

562991

Septic Tank and Related Services

$9.0

562998

All Other Miscellaneous Waste Management Services

$16.5

Sector 61—Educational Services

Subsector 611—Educational Services

611110

Elementary and Secondary Schools

$20.0

611210

Junior Colleges

$32.5

611310

Colleges, Universities and Professional Schools

$34.5

611410

Business and Secretarial Schools

$20.5

611420

Computer Training

$16.0

611430

Professional and Management Development Training

$15.0

611511

Cosmetology and Barber Schools

$13.0

611512

Flight Training

$34.0

611513

Apprenticeship Training

$11.5

611519

Other Technical and Trade Schools

$21.0

611519 (Exception)

Job Corps Centers 16

$47.0 16

611610

Fine Arts Schools

$9.0

611620

Sports and Recreation Instruction

$9.0

611630

Language Schools

$20.5

611691

Exam Preparation and Tutoring

$12.5

611692

Automobile Driving Schools

$10.0

611699

All Other Miscellaneous Schools and Instruction

$16.5

611710

Educational Support Services

$24.0

Sector 62—Health Care and Social Assistance

Subsector 621—Ambulatory Health Care Services

621111

Offices of Physicians (except Mental Health Specialists)

$16.0

621112

Offices of Physicians, Mental Health Specialists

$13.5

621210

Offices of Dentists

$9.0

621310

Offices of Chiropractors

$9.0

621320

Offices of Optometrists

$9.0

621330

Offices of Mental Health Practitioners (except Physicians)

$9.0

621340

Offices of Physical, Occupational and Speech Therapists and Audiologists

$12.5

621391

Offices of Podiatrists

$9.0

621399

Offices of All Other Miscellaneous Health Practitioners

$10.0

621410

Family Planning Centers

$19.0

621420

Outpatient Mental Health and Substance Abuse Centers

$19.0

621491

HMO Medical Centers

$44.5

621492

Kidney Dialysis Centers

$47.0

621493

Freestanding Ambulatory Surgical and Emergency Centers

$19.0

621498

All Other Outpatient Care Centers

$25.5

621511

Medical Laboratories

$41.5

621512

Diagnostic Imaging Centers

$19.0

621610

Home Health Care Services

$19.0

621910

Ambulance Services

$22.5

621991

Blood and Organ Banks

$40.0

621999

All Other Miscellaneous Ambulatory Health Care Services

$20.5

Subsector 622—Hospitals

622110

General Medical and Surgical Hospitals

$47.0

622210

Psychiatric and Substance Abuse Hospitals

$47.0

622310

Specialty (except Psychiatric and Substance Abuse) Hospitals

$47.0

Subsector 623—Nursing and Residential Care Facilities

623110

Nursing Care Facilities (Skilled Nursing Facilities)

$34.0

623210

Residential Intellectual and Developmental Disability Facilities

$19.0

623220

Residential Mental Health and Substance Abuse Facilities

$19.0

623311

Continuing Care Retirement Communities

$34.0

623312

Assisted Living Facilities for the Elderly

$23.5

623990

Other Residential Care Facilities

$16.0

Subsector 624—Social Assistance

624110

Child and Youth Services

$15.5

624120

Services for the Elderly and Persons with Disabilities

$15.0

624190

Other Individual and Family Services

$16.0

624210

Community Food Services

$19.5

624221

Temporary Shelters

$13.5

624229

Other Community Housing Services

$19.0

624230

Emergency and Other Relief Services

$41.5

624310

Vocational Rehabilitation Services

$15.0

624410

Child Care Services

$9.5

Sector 71—Arts, Entertainment and Recreation

Subsector 711—Performing Arts, Spectator Sports and Related Industries

711110

Theater Companies and Dinner Theaters

$25.0

711120

Dance Companies

$18.0

711130

Musical Groups and Artists

$15.0

711190

Other Performing Arts Companies

$34.0

711211

Sports Teams and Clubs

$47.0

711212

Racetracks

$47.0

711219

Other Spectator Sports

$16.5

711310

Promoters of Performing Arts, Sports and Similar Events with Facilities

$40.0

711320

Promoters of Performing Arts, Sports and Similar Events without Facilities

$22.0

711410

Agents and Managers for Artists, Athletes, Entertainers and Other Public Figures

$17.5

711510

Independent Artists, Writers, and Performers

$9.0

Subsector 712—Museums, Historical Sites and Similar Institutions

712110

Museums

$34.0

712120

Historical Sites

$13.0

712130

Zoos and Botanical Gardens

$34.0

712190

Nature Parks and Other Similar Institutions

$19.5

Subsector 713—Amusement, Gambling and Recreation Industries

713110

Amusement and Theme Parks

$47.0

713120

Amusement Arcades

$9.0

713210

Casinos (except Casino Hotels)

$34.0

713290

Other Gambling Industries

$40.0

713910

Golf Courses and Country Clubs

$19.0

713920

Skiing Facilities

$35.0

713930

Marinas

$11.0

713940

Fitness and Recreational Sports Centers

$17.5

713950

Bowling Centers

$12.5

713990

All Other Amusement and Recreation Industries

$9.0

Sector 72—Accommodation and Food Services

Subsector 721—Accommodation

721110

Hotels (except Casino Hotels) and Motels

$40.0

721120

Casino Hotels

$40.0

721191

Bed-and-Breakfast Inns

$9.0

721199

All Other Traveler Accommodation

$9.0

721211

RV (Recreational Vehicle) Parks and Campgrounds

$10.0

721214

Recreational and Vacation Camps (except Campgrounds)

$9.0

721310

Rooming and Boarding Houses, Dormitories, and Workers' Camps

$14.0

Subsector 722—Food Services and Drinking Places

722310

Food Service Contractors

$47.0

722320

Caterers

$9.0

722330

Mobile Food Services

$9.0

722410

Drinking Places (Alcoholic Beverages)

$9.0

722511

Full-Service Restaurants

$11.5

722513

Limited-Service Restaurants

$13.5

722514

Cafeterias, Grill Buffets, and Buffets

$34.0

722515

Snack and Nonalcoholic Beverage Bars

$22.5

Sector 81—Other Services (Except Public Administration)

Subsector 811—Repair and Maintenance

811111

General Automotive Repair

$9.0

811114

Specialized Automotive Repair

$9.0

811121

Automotive Body, Paint and Interior Repair and Maintenance

$9.0

811122

Automotive Glass Replacement Shops

$17.5

811191

Automotive Oil Change and Lubrication Shops

$11.0

811192

Car Washes

$9.0

811198

All Other Automotive Repair and Maintenance

$10.0

811210

Electronic and Precision Equipment Repair and Maintenance

$34.0

811310

Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance

$12.5

811411

Home and Garden Equipment Repair and Maintenance

$9.0

811412

Appliance Repair and Maintenance

$19.0

811420

Reupholstery and Furniture Repair

$9.0

811430

Footwear and Leather Goods Repair

$9.0

811490

Other Personal and Household Goods Repair and Maintenance

$9.0

Subsector 812—Personal and Laundry Services

812111

Barber Shops

$9.5

812112

Beauty Salons

$9.5

812113

Nail Salons

$9.0

812191

Diet and Weight Reducing Centers

$27.5

812199

Other Personal Care Services

$9.0

812210

Funeral Homes and Funeral Services

$12.5

812220

Cemeteries and Crematories

$25.0

812310

Coin-Operated Laundries and Drycleaners

$13.0

812320

Drycleaning and Laundry Services (except Coin-Operated)

$8.0

812331

Linen Supply

$40.0

812332

Industrial Launderers

$47.0

812910

Pet Care (except Veterinary) Services

$9.0

812921

Photofinishing Laboratories (except One-Hour)

$29.5

812922

One-Hour Photofinishing

$19.0

812930

Parking Lots and Garages

$47.0

812990

All Other Personal Services

$15.0

Subsector 813—Religious, Grantmaking, Civic, Professional and Similar Organizations

813110

Religious Organizations

$13.0

813211

Grantmaking Foundations

$40.0

813212

Voluntary Health Organizations

$34.0

813219

Other Grantmaking and Giving Services

$47.0

813311

Human Rights Organizations

$34.0

813312

Environment, Conservation and Wildlife Organizations

$19.5

813319

Other Social Advocacy Organizations

$18.0

813410

Civic and Social Organizations

$9.5

813910

Business Associations

$15.5

813920

Professional Organizations

$23.5

813930

Labor Unions and Similar Labor Organizations

$16.5

813940

Political Organizations

$14.0

813990

Other Similar Organizations (except Business, Professional, Labor, and Political Organizations)

$13.5

Sector 92—Public Administration 17

(Small business size standards are not established for this sector. Establishments in the Public Administration sector are Federal, state, and local government agencies which administer and oversee government programs and activities that are not performed by private establishments.)

Footnotes

1. NAICS code 115310 —Support Activities for Forestry: Forest Fire Suppression and Fuels Management Services are two components of Support Activities for Forestry. Forest Fire Suppression includes establishments which provide services to fight forest fires. These firms usually have fire-fighting crews and equipment. Fuels Management Services firms provide services to clear land of hazardous materials that would fuel forest fires. The treatments used by these firms may include prescribed fire, mechanical removal, establishing fuel breaks, thinning, pruning, and piling.

2. NAICS code 237990 —Dredging: To be considered small for purposes of Government procurement, a firm or its similarly situated subcontractors must perform at least 40 percent of the volume dredged with their own equipment or equipment owned by another small dredging concern.

3. NAICS code 311421 —For purposes of Government procurement for food canning and preserving, the standard of 1,000 employees excludes agricultural labor as defined in 3306(k) of the Internal Revenue Code, 26 U.S.C. 3306(k).

4. NAICS code 324110 —To qualify as small for purposes of Government procurement, the petroleum refiner, including its affiliates, must be a concern that has either no more than 1,500 employees or no more than 200,000 barrels per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes all domestic and foreign affiliates, all owned or leased facilities, and all facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. To qualify under the capacity size standard, the firm, together with its affiliates, must be primarily engaged in refining crude petroleum into refined petroleum products. A firm's “primary industry” is determined in accordance with 13 CFR 121.107.

5. NAICS code 326211 —For Government procurement, a firm is small for bidding on a contract for pneumatic tires within Census NAICS Product Classification codes 3262111 and 3262113, provided that:

(a) The value of tires within Census NAICS Product Classification codes 3262111 and 3262113 that it manufactured in the United States during the previous calendar year is more than 50 percent of the value of its total worldwide manufacture,

(b) The value of pneumatic tires within Census NAICS Product Classification codes 3262111 and 3262113 comprising its total worldwide manufacture during the preceding calendar year was less than 5 percent of the value of all such tires manufactured in the United States during that period, and

(c) The value of the principal product that it manufactured, produced, or sold worldwide during the preceding calendar year is less than 10 percent of the total value of such products manufactured or otherwise produced or sold in the United States during that period.

6. NAICS Subsectors 333, 334, 335 and 336 —For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a “manufacturer” although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.

7. NAICS code 336413 —Contracts for the rebuilding or overhaul of aircraft ground support equipment on a contract basis are classified under NAICS code 336413.

8. NAICS Codes 522110, 522130, 522180, and 522210 —A financial institution's assets are determined by averaging the assets reported on its four quarterly financial statements for the preceding year. “Assets” for the purposes of this size standard means the assets defined according to the Federal Financial Institutions Examination Council 041 call report form for NAICS codes 522110, 522180, and 522210 and the National Credit Union Administration 5300 call report form for NAICS code 522130.

9. NAICS codes 531110, 531120, 531130, and 531190 —Leasing of Building Space to the Federal Government by Owners: For Government procurement, a size standard of $47 million in gross receipts applies to the owners of building space leased to the Federal Government. The standard does not apply to an agent.

10. NAICS codes 488510 (excluding the exception), 531210, 541810, 561510, 561520 and 561920 —As measured by total revenues, but excluding funds received in trust for an unaffiliated third party, such as bookings or sales subject to commissions. The commissions received are included as revenue.

11. NAICS code 541713, 541714 , and 541715 —

(a) Research and Development” means laboratory or other physical research and development. It does not include economic, educational, engineering, operations, systems, or other nonphysical research; or computer programming, data processing, commercial and/or medical laboratory testing.

(b) For research and development contracts requiring the delivery of a manufactured product, the appropriate size standard is that of the manufacturing industry.

(c) For purposes of the Small Business Innovation Research (SBIR) and Small Business Transfer Technology (STTR) programs, the term “research” or “research and development” means any activity which is (A) a systematic, intensive study directed toward greater knowledge or understanding of the subject studied; (B) a systematic study directed specifically toward applying new knowledge to meet a recognized need; or (C) a systematic application of knowledge toward the production of useful materials, devices, and systems or methods, including design, development, and improvement of prototypes and new processes to meet specific requirements. See 15 U.S.C. 638(e)(5) and section 3 of the SBIR and STTR policy directives available at www.sbir.gov. For size eligibility requirements for the SBIR and STTR programs, see § 121.702 of this part.

(d) “Research and Development” for guided missiles and space vehicles includes evaluations and simulation, and other services requiring thorough knowledge of complete missiles and spacecraft.

12. NAICS code 561210 —Facilities Support Services:

(a) If one or more activities of Facilities Support Services as defined in paragraph (b) (below in this footnote) can be identified with a specific industry and that industry accounts for 50 percent or more of the value of an entire procurement, then the proper classification of the procurement is that of the specific industry, not Facilities Support Services.

(b) “Facilities Support Services” requires the performance of three or more separate activities in the areas of services or specialty trade contractors industries. If services are performed, these service activities must each be in a separate NAICS industry. If the procurement requires the use of specialty trade contractors (plumbing, painting, plastering, carpentry, etc.), all such specialty trade contractors activities are considered a single activity and classified as “Building and Property Specialty Trade Services.” Since “Building and Property Specialty Trade Services” is only one activity, two additional activities of separate NAICS industries are required for a procurement to be classified as “Facilities Support Services.”

13. NAICS code 238990 —Building and Property Specialty Trade Services: If a procurement requires the use of multiple specialty trade contractors ( i.e., plumbing, painting, plastering, carpentry, etc.), and no specialty trade accounts for 50 percent or more of the value of the procurement, all such specialty trade contractors activities are considered a single activity and classified as Building and Property Specialty Trade Services.

14. NAICS 562910 —Environmental Remediation Services:

(a) For SBA assistance as a small business concern in the industry of Environmental Remediation Services, other than for Government procurement, a concern must be engaged primarily in furnishing a range of services for the remediation of a contaminated environment to an acceptable condition including, but not limited to, preliminary assessment, site inspection, testing, remedial investigation, feasibility studies, remedial design, containment, remedial action, removal of contaminated materials, storage of contaminated materials and security and site closeouts. If one of such activities accounts for 50 percent or more of a concern's total revenues, employees, or other related factors, the concern's primary industry is that of the particular industry and not the Environmental Remediation Services Industry.

(b) For purposes of classifying a Government procurement as Environmental Remediation Services, the general purpose of the procurement must be to restore or directly support the restoration of a contaminated environment (such as, preliminary assessment, site inspection, testing, remedial investigation, feasibility studies, remedial design, remediation services, containment, removal of contaminated materials, storage of contaminated materials or security and site closeouts), although the general purpose of the procurement need not necessarily include remedial actions. Also, the procurement must be composed of activities in three or more separate industries with separate NAICS codes or, in some instances ( e.g., engineering), smaller sub-components of NAICS codes with separate, distinct size standards. These activities may include, but are not limited to, separate activities in industries such as: Heavy Construction; Specialty Trade Contractors; Engineering Services; Architectural Services; Management Consulting Services; Hazardous and Other Waste Collection; Remediation Services, Testing Laboratories; and Research and Development in the Physical, Engineering and Life Sciences. If any activity in the procurement can be identified with a separate NAICS code, or component of a code with a separate distinct size standard, and that industry accounts for 50 percent or more of the value of the entire procurement, then the proper size standard is the one for that particular industry, and not the Environmental Remediation Service size standard.

15. NAICS code 513210 —For purposes of Government procurement, the purchase of software subject to potential waiver of the nonmanufacturer rule pursuant to § 121.1203(d) should be classified under this NAICS code.

16. NAICS code 611519 —Job Corps Centers. For classifying a Federal procurement, the purpose of the solicitation must be for the management and operation of a U.S. Department of Labor Job Corps Center. The activities involved include admissions activities, life skills training, educational activities, comprehensive career preparation activities, career development activities, career transition activities, as well as the management and support functions and services needed to operate and maintain the facility. For SBA assistance as a small business concern, other than for Federal Government procurements, a concern must be primarily engaged in providing the services to operate and maintain Federal Job Corps Centers.

17. NAICS Sector 92 —Small business size standards are not established for this sector. Establishments in the Public Administration sector are Federal, State, and local government agencies which administer and oversee government programs and activities that are not performed by private establishments. Concerns performing operational services for the administration of a government program are classified under the NAICS private sector industry based on the activities performed. Similarly, procurements for these types of services are classified under the NAICS private sector industry that best describes the activities to be performed. For example, if a government agency issues a procurement for law enforcement services, the requirement would be classified using one of the NAICS industry codes under 56161, Investigation, Guard, and Armored Car Services.

18. NAICS code 541519 —An Information Technology Value Added Reseller (ITVAR) provides a total solution to information technology acquisitions by providing multi-vendor hardware and software along with significant value added services. Significant value added services consist of, but are not limited to, configuration consulting and design, systems integration, installation of multi-vendor computer equipment, customization of hardware or software, training, product technical support, maintenance, and end user support. For purposes of Government procurement, an information technology procurement classified under this exception and 150-employee size standard must consist of at least 15% and not more than 50% of value added services, as measured by the total contract price. In addition, the offeror must comply with the manufacturing performance requirements, or comply with the non-manufacturer rule by supplying the products of small business concerns, unless SBA has issued a class or contract specific waiver of the non-manufacturer rule. If the contract consists of less than 15% of value added services, then it must be classified under a NAICS manufacturing industry. If the contract consists of more than 50% of value added services, then it must be classified under the NAICS industry that best describes the predominate service of the procurement.

§ 121.301 What size standards and affiliation principles are applicable to financial assistance programs?

The Small Business Act defines a small business concern as one which is independently owned and operated, and which is not dominant in its field of operation. SBA interprets this statutory definition to require, in certain circumstances, the inclusion of other entities (“Affiliates”) owned by the applicant or an owner of the applicant in determining the size of the applicant.

(a) For Business Loans (other than for 7(a) Business Loans) and for Disaster Loans (other than physical disaster loans), an applicant business concern must satisfy two criteria:

(1) The size of the applicant alone (without affiliates) must not exceed the size standard designated for the industry in which the applicant is primarily engaged; and

(2) The size of the applicant combined with its affiliates must not exceed the size standard designated for either the primary industry of the applicant alone or the primary industry of the applicant and its affiliates, which ever is higher. These size standards are set forth in § 121.201.

(b) For 7(a) Business Loans and Development Company programs, an applicant business concern must meet one of the following standards:

(1) The same standards applicable under paragraph (a) of this section; or

(2) Including its affiliates, tangible net worth not in excess of $20 million, and average net income after Federal income taxes (excluding any carry over losses) for the preceding two completed fiscal years not in excess of $6.5 million.

(i) If the applicant is not required by law to pay State (and local, if any) income taxes at the enterprise level, multiply its net income by the marginal State income tax rate (or by the combined State and local income tax rates, as applicable) that would have applied if it were a taxable corporation.

(ii) Multiply the applicant's net income, less any deduction for State and local income taxes calculated under paragraph (b)(2)(i) of this section, by the marginal Federal income tax rate that would have applied if the applicant were a taxable corporation.

(iii) Sum the results obtained in paragraphs (b)(2)(i) and (b)(2)(ii) of this section.

(c) For the Small Business Investment Company (SBIC) program, an applicant must meet one of the following standards:

(1) The same standards applicable under paragraph (a) of this section; or

(2) Including its affiliates, tangible net worth not in excess of $24 million, and average net income after Federal income taxes (excluding any carry-over losses) for the preceding two completed fiscal years not in excess of $8 million. If the applicant is not required by law to pay Federal income taxes at the enterprise level, but is required to pass income through to its shareholders, partners, beneficiaries, or other equitable owners, the applicant's “net income after Federal income taxes” will be its net income reduced by an amount computed as follows:

(i) If the applicant is not required by law to pay State (and local, if any) income taxes at the enterprise level, multiply its net income by the marginal State income tax rate (or by the combined State and local income tax rates, as applicable) that would have applied if it were a taxable corporation.

(ii) Multiply the applicant's net income, less any deduction for State and local income taxes calculated under paragraph (c)(2)(i) of this section, by the marginal Federal income tax rate that would have applied if the applicant were a taxable corporation.

(iii) Add the results obtained in paragraphs (c)(2)(i) and (c)(2)(ii) of this section.

(d) For Surety Bond Guarantee assistance—a business concern, combined with its affiliates, must meet the size standard for the primary industry in which such business concern, combined with its affiliates, is engaged.

(e) The applicable size standards for purposes of SBA's financial assistance programs, excluding the Surety Bond Guarantee assistance program, are increased by 25 percent whenever the applicant agrees to use all of the financial assistance within a labor surplus area. The U.S. Department of Labor (DOL) issues the Labor Surplus Area (LSA) list on a fiscal year basis on its website at www.dol.gov/agencies/eta/lsa.

(f) Affiliation. Any of the circumstances described below establishes affiliation for applicants of SBA's Business Loan, Disaster Loan, and Surety Bond Programs. For this rule, the Business Loan Programs consist of the 7(a) Loan Program (Direct and Guaranteed Loans), the Microloan Program, the Intermediary Lending Pilot Program, and the Development Company Loan Program (“504 Loan Program”). The Disaster Loan Programs consist of Physical Disaster Business Loans, Economic Injury Disaster Loans, Military Reservist Economic Injury Disaster Loans, and Immediate Disaster Assistance Program loans. The following principles apply for the Business Loan, Disaster Loan, and Surety Bond Guarantee Programs:

(1) Ownership. (i) When the Applicant owns more than 50 percent of another business, the Applicant and the other business are affiliated.

(ii) When a business owns more than 50 percent of an Applicant, the business that owns the Applicant is affiliated with the Applicant. Additionally, if the business entity owner that owns more than 50 percent of the Applicant also owns more than 50 percent of another business that operates in the same 3-digit NAICS subsector as the Applicant, then the business entity owner, the other business and the Applicant are all affiliated.

(iii) When an individual owns more than 50 percent of the Applicant and the individual also owns more than 50 percent of another business entity that operates in the same 3-digit NAICS subsector as the Applicant, the Applicant and the individual owner's other business entity are affiliated.

(iv) When the Applicant does not have an owner that owns more than 50 percent of the Applicant, if an owner of 20 percent or more of the Applicant is a business that operates in the same 3-digit NAICS subsector as the Applicant, the Applicant and the owner are affiliated.

(v) When the Applicant does not have an owner that owns more than 50 percent of the Applicant, if an owner of 20 percent or more of the Applicant also owns more than 50 percent of another business entity that operates in the same 3-digit NAICS subsector as the Applicant, the Applicant and the owner's other business entity are affiliated.

(vi) Ownership interests of spouses and minor children must be combined when determining amount of ownership interest.

(vii) When determining the percentage of ownership that an individual owns in a business, SBA considers the pro rata ownership of entities. For example, John Smith, Jane Doe, and Jane Doe, Inc., each own an interest in the Applicant. Jane Doe owns 15 percent of the Applicant, and she also owns 100 percent of Jane Doe, Inc. Jane Doe, Inc. owns 50 percent of the Applicant. SBA considers Jane Doe to own 65 percent of the Applicant.

(2) Stock options, convertible securities, and agreements to merge. (i) For purposes of this subparagraph, SBA considers stock options, convertible securities, and agreements to merge (including agreements in principle) to have a present effect on the ownership of the entity. SBA treats such options, convertible securities, and agreements as though the rights granted have been exercised.

(ii) Agreements to open or continue negotiations towards the possibility of a merger or a sale of stock at a later date are not considered “agreements in principle” and are thus not given present effect.

(iii) Options, convertible securities, and agreements that are subject to conditions precedent which are incapable of fulfillment, speculative, conjectural, or unenforceable under state or Federal law, or where the probability of the transaction (or exercise of the rights) occurring is shown to be extremely remote, are not given present effect.

(iv) SBA will not give present effect to individuals', concerns', or other entities' ability to divest all or part of their ownership interest to avoid a finding of affiliation.

(3) Determining the concern's size. In determining the concern's size, SBA counts the receipts, employees (see § 121.201), or the alternate size standard (if applicable) of the concern whose size is at issue and all of its domestic and foreign affiliates, regardless of whether the affiliates are organized for profit.

(4) Exceptions to affiliation. For exceptions to affiliation, see § 121.103(b).

(g) For COVID-19 Economic Injury Disaster (COVID EIDL) loans, an “affiliated business” or “affiliate” is a business in which an eligible entity has an equity interest or right to profit distributions of not less than 50 percent, or in which an eligible entity has the contractual authority to control the direction of the business, provided that such affiliation shall be determined as of any arrangements or agreements in existence as of January 31, 2020. For exceptions to affiliation, see § 121.103(b).

§ 121.302 When does SBA determine the size status of an applicant?

(a) The size status of an applicant for SBA financial assistance is determined as of the date the application for financial assistance is accepted for processing by SBA, except for applications under the Preferred Lenders Program (PLP), the Disaster Loan program, the SBIC program, and the New Markets Venture Capital (NMCV) program.

(b) For the Preferred Lenders Program, size is determined as of the date of approval of the loan by the Preferred Lender.

(c) For disaster loan assistance (other than physical disaster loans), size status is determined as of the date the disaster commenced, as set forth in the Disaster Declaration. For pre-disaster mitigation loans, size status is determined as of the date SBA accepts a complete Pre-Disaster Mitigation Small Business Loan Application for processing. Refer to § 123.408 of this chapter to find out what SBA considers to be a complete Pre-Disaster Mitigation Small Business Loan Application.

(d) For financial assistance from an SBIC licensee or an NMVC company, size is determined as of the date a concern's application is accepted for processing by the SBIC or the NMVC company.

(e) Changes in size after the applicable date when size is determined will not disqualify an applicant for assistance.

§ 121.303 What size procedures are used by SBA before it makes a formal size determination?

(a) A concern that submits an application for financial assistance is deemed to have certified that it is small under the applicable size standard. SBA may question the concern's status based on information supplied in the application or from any other source.

(b) A small business investment company, a development company, a surety bond company, or a preferred lender may accept as true the size information provided by an applicant, unless credible evidence to the contrary is apparent.

(c) Size is initially considered by the individual with final financial assistance authority. This is not a formal size determination. A formal determination may be requested prior to a denial of eligibility based on size.

(d) An applicant may request a formal size determination when assistance has been denied for size ineligibility. Except for disaster loan eligibility, a request for a formal size determination must be made to the Government Contracting Area Director serving the area in which the headquarters of the applicant is located, regardless of the location of the parent company or affiliates. For disaster loan assistance, the request for a size determination must be made to the Area Director for the Disaster Area Office which denied the assistance.

(e) There are no time limitations for making a formal size determination for purposes of financial assistance. The official making the formal size determination must provide a copy of the determination to the applicant, to the requesting SBA official, and to other interested SBA program officials.

§ 121.304 What are the size requirements for refinancing an existing SBA loan?

(a) A concern that applies to refinance an existing SBA loan or guarantee will be considered small for the refinancing even though its size has increased since the date of the original financing to exceed its applicable size standard, provided that:

(1) The increase in size is due to natural growth (as distinguished from merger, acquisition or similar management action); and

(2) SBA determines that refinancing is necessary to protect the Government's financial interest.

(b) If a concern's size has increased other than by natural growth, the concern and its affiliates must be small at the time the application for refinancing is accepted for processing by SBA.

§ 121.305 What size eligibility requirements exist for obtaining financial assistance relating to particular procurements?

A concern qualified as small for a particular procurement, including an 8(a) subcontract, is small for financial assistance directly and primarily relating to the performance of the particular procurement.

§ 121.401 What procurement programs are subject to size determinations?

The rules set forth in §§ 121.401 through 121.412 apply to all Federal procurement programs for which status as a small business is required or advantageous, including the small business set-aside program, SBA's Certificate of Competency program, SBA's 8(a) Business Development program, SBA's HUBZone program, the Women Owned Small Business (WOSB) Federal Contract Program, SBA's Service-Disabled Veteran-Owned Small Business program, the Small Business Subcontracting program, and the Federal Small Disadvantaged Business (SDB) program.

§ 121.402 What size standards are applicable to Federal Government Contracting programs?

(a) A concern must not exceed the size standard for the NAICS code specified in the solicitation. The contracting officer must specify the size standard in effect on the date the solicitation is issued. If SBA amends the size standard and it becomes effective before the date initial offers (including price) are due, the contracting officer may amend the solicitation and use the new size standard.

(b) The procuring agency contracting officer, or authorized representative, designates the proper NAICS code and corresponding size standard in a solicitation, selecting the single NAICS code which best describes the principal purpose of the product or service being acquired. Except for multiple award contracts as set forth in paragraph (c) of this section, every solicitation, including a request for quotations, must contain only one NAICS code and only one corresponding size standard.

(1) Primary consideration is given to the industry descriptions in the U.S. NAICS Manual, the product or service description in the solicitation and any attachments to it, the relative value and importance of the components of the procurement making up the end item being procured, and the function of the goods or services being purchased.

(2) A procurement is generally classified according to the component which accounts for the greatest percentage of contract value. Acquisitions for supplies must be classified under the appropriate manufacturing or supply NAICS code, not under a Wholesale Trade or Retail Trade NAICS code. A concern that submits an offer or quote for a contract, order, or subcontract where the NAICS code assigned to the contract, order, or subcontract is one for supplies, and furnishes a product it did not itself manufacture or produce, is categorized as a nonmanufacturer and deemed small if it has 500 or fewer employees and meets the requirements of § 121.406(b).

(c) Multiple Award Contracts ( see definition at § 125.1).

(1) For a Multiple Award Contract, the contracting officer must:

(i) Assign the solicitation a single NAICS code and corresponding size standard which best describes the principal purpose of the acquisition as set forth in paragraph (b) of this section, only if the NAICS code will also best describe the principal purpose of each order to be placed under the Multiple Award Contract; or

(ii) Divide the solicitation into discrete categories (such as Contract Line Item Numbers (CLINs), Special Item Numbers (SINs), Sectors, Functional Areas (FAs), or the equivalent), and assign each discrete category the single NAICS code and corresponding size standard that best describes the principal purpose of the goods or services to be acquired under that category (CLIN, SIN, Sector, FA or equivalent) as set forth in paragraph (b) of this section. A concern must meet the applicable size standard for each category (CLIN, SIN, Sector, FA or equivalent) for which it seeks an award as a small business concern.

(2)(i) The contracting officer must assign a single NAICS code for each order issued against a Multiple Award Contract. The NAICS code assigned to an order must be a NAICS code included in the underlying Multiple Award Contract. When placing an order under a Multiple Award Contract with multiple NAICS codes, the contracting officer must assign the NAICS code and corresponding size standard that best describes the principal purpose of each order. In cases where an agency can issue an order against multiple SINs with different NAICS codes, the contracting officer must select the single NAICS code that best represents the acquisition. If the NAICS code corresponding to the principal purpose of the order is not contained in the underlying Multiple Award Contract, the contracting officer may not use the Multiple Award Contract to issue that order.

(ii) With respect to an order issued against a multiple award contract, an agency will receive small business credit for goaling only if the business concern awarded the order has represented its status as small for the underlying multiple award contract for the same NAICS code as that assigned to the order, provided recertification has not been required or occurred for the contract or order.

(d) The NAICS code assigned to a procurement and its corresponding size standard is final unless timely appealed to SBA's Office of Hearings and Appeals (OHA), or unless SBA assigns an NAICS code or size standard as provided in paragraph (e) of this section.

(e) When a NAICS code designation or size standard in a solicitation is unclear, incomplete, missing, or prohibited, SBA may clarify, complete, or supply a NAICS code designation or size standard, as appropriate, in connection with a formal size determination or size appeal.

(f) Any offeror or other interested party adversely affected by an NAICS code designation or size standard designation may appeal the designations to OHA under part 134 of this chapter.

§ 121.403 Are SBA size determinations and NAICS code designations binding on parties?

Formal size determinations and NAICS code designations made by authorized SBA officials are binding upon the parties. Opinions otherwise provided by SBA officials to contracting officers or others are advisory in nature, and are not binding or appealable.

§ 121.404 When is the size status of a business concern determined?

(a) General. A concern, including its affiliates, must qualify as small under the NAICS code assigned to a contract as of the date the concern submits a written self-certification that it is small to the procuring activity as part of its initial offer or response which includes price. Once awarded a contract as a small business, a firm is generally considered to be a small business throughout the life of that contract.

(b) Multiple Award Contracts. (1) If a single NAICS code is assigned to a multiple award contract as set forth in § 121.402(c)(1)(i), SBA determines size status for the underlying multiple award contract as of the date a business concern submits its initial offer (or other formal response to a solicitation), which includes price, for the contract based upon the size standard set forth in the solicitation for the multiple award contract.

(2) When multiple NAICS codes are assigned to a multiple award contract as set forth in § 121.402(c)(1)(ii), SBA determines size status for the underlying multiple award contract for each discrete category for which an offer is submitted, by applying the size standard corresponding to each discrete category, as of the date a business concern submits its initial offer which includes price for the contract.

(3) Where concerns are not required to submit price as part of the initial offer for a multiple award contract, SBA determines size status for the underlying multiple award contract as of the date a business concern submits its initial offer for the contract, which may not include price.

(c) Orders and Agreements Established Against Multiple Award Contracts —(1) Unrestricted Contracts. Where an order is set-aside for small business under an unrestricted multiple award contract, SBA determines size status for each order placed against the multiple award contract as of the date a business concern submits its initial offer (or other formal response to a solicitation), which includes price, for each order.

(2) Set-Aside or Reserved Contracts. Where an order is issued under a multiple award contract that itself was set aside or reserved for small business ( i.e., small business set-aside, 8(a) small business, service-disabled veteran-owned small business, HUBZone small business, or women-owned/economically-disadvantaged women-owned small business), SBA determines size status as of the date a business concern submits its initial offer, which includes price, for the set-aside or reserved multiple award contract, unless a contracting officer requests size recertification with respect to a specific order.

(i) Where a contracting officer requests size recertification with respect to a specific order, size is determined as of the date the business concern submits its initial offer (or other formal response to a solicitation), which includes price, for the order.

(ii) Where a contracting officer requests size recertification with respect to a specific order, size is determined only with respect to that order. Where a contract holder has grown to be other than small and cannot recertify as small for a specific order for which a contracting officer requested recertification, it may continue to qualify as small for other orders issued under the contract where a contracting officer does not request recertification.

(3) Agreements. With respect to agreements established under FAR part 13, size is determined as of the date the business concern submits its initial offer, which includes price, for the agreement. Because an agreement is not a contract, the concern must also qualify as small as of the date the concern submits its initial offer, which includes price, for each order issued pursuant to the agreement to be considered small for the order.

(4) Exceptions. (i) For orders or BPAs to be placed against the GSA Federal Supply Schedule (FSS) Multiple Award Schedule (MAS) contract, size is determined as of the date the business concern submits its initial offer, which includes price, for the GSA FSS MAS contract.

(ii) For 8(a) sole source orders issued under a multiple award contract, size is determined in accordance with § 124.503(i)(1)(iv) of this chapter, as of the date the order is offered to the 8(a) BD program, regardless of whether the multiple award contract is unrestricted, set-aside, or the GSA FSS MAS contract.

(iii) Size is determined on the date of recertification when a recertification is required pursuant to §§ 125.12(a) and (b) of this chapter, or on the date of initial offer which includes price if requested by a contracting officer pursuant to § 125.12(c). This exception applies to all provisions of §§ 121.404(a), (b), (c), and (d).

(d) Eligibility for SBA programs. A concern applying to be certified as a Participant in SBA's 8(a) Business Development program (under part 124, subpart A, of this chapter), as a HUBZone small business concern (under part 126 of this chapter), as a women-owned small business concern (under part 127 of this chapter), or as a service-disabled veteran-owned small business concern (under part 128 of this chapter) must qualify as a small business as of the date of its application and, where applicable, the date the SBA program office requests a formal size determination in connection with a concern that otherwise appears eligible for program certification. For the 8(a) Business Development program, a concern must qualify as small under the size standard corresponding to its primary industry classification. For all other certification programs, a concern must qualify as small under the size standard corresponding to any NAICS code listed in its SAM profile. SBA will accept a concern's size representation in SAM, or successor system, unless there is evidence indicating that the concern is other than small. SBA will request a formal size determination pursuant to § 121.1001(b)(8) where any information it possesses calls into question the SAM size representation.

(e) Certificates of competency. The size status of an applicant for a Certificate of Competency (COC) relating to an unrestricted procurement is determined as of the date of the concern's application for the COC.

(f) Nonmanufacturer rule, ostensible subcontractor rule, and joint venture agreements. Compliance with the nonmanufacturer rule set forth in § 121.406(b)(1), the ostensible subcontractor rule set forth in § 121.103(h)(3), and the joint venture agreement requirements in §§ 124.513(c) and (d), §§ 126.616(c) and (d), §§ 127.506(c) and (d), and §§ 125.8(b) and (c) of this chapter, as appropriate, is determined as of the date of the final proposal revision for negotiated acquisitions and final bid for sealed bidding.

(g) Subcontracting. For subcontracting purposes, a concern must qualify as small as of the date that it certifies that it is small for the subcontract. The applicable size standard is that which is set forth in § 121.410 and which is in effect at the time the concern self-certifies that it is small for the subcontract. A prime contractor may rely on the self-certification of a subcontractor provided it does not have a reason to doubt the concern's self-certification.

(h) Two-step procurements. For purposes of architect-engineering, design/build or two-step sealed bidding procurements, a concern must qualify as small as of the date that it certifies that it is small as part of its initial bid or proposal (which may or may not include price).

(i) Recertification. See § 125.12 for information on recertification of size and status, and the effect of recertification. None of the exceptions set forth in paragraph (c)(4) of this section have an effect or serve as an exception to whether recertification is required under § 125.12.

(j) Follow-on contracts. A follow-on or renewal contract is a new contracting action. As such, size is determined as of the date the concern submits a written self-certification that it is small to the procuring agency as part of its initial offer including price for the follow-on or renewal contract.

§ 121.405 May a business concern self-certify its small business size status?

(a) A concern must self-certify it is small under the size standard specified in the solicitation, or as clarified, completed or supplied by SBA pursuant to § 121.402(d).

(b) A contracting officer may accept a concern's self-certification as true for the particular procurement involved in the absence of a written protest by other offerors or other credible information which causes the contracting officer or SBA to question the size of the concern.

(c) Procedures for protesting the self-certification of an offeror are set forth in §§ 121.1001 through 121.1009.

§ 121.406 How does a small business concern qualify to provide manufactured products or other supply items under a small business set-aside, service-disabled veteran-owned small business, HUBZone, WOSB or EDWOSB, or 8(a) contract?

(a) General. In order to qualify as a small business concern for a small business set-aside, service-disabled veteran-owned small business set-aside or sole source contract, HUBZone set-aside or sole source contract, WOSB or EDWOSB set-aside or sole source contract, 8(a) set-aside or sole source contract, partial set-aside, or set aside of an order against a multiple award contract to provide manufactured products or other supply items, an offeror must either:

(1) Be the manufacturer or producer of the end item being procured (and the end item must be manufactured or produced in the United States); or

(2) Comply with the requirements of paragraph (b), (c) or (d) of this section as a nonmanufacturer, a kit assembler or a supplier under Simplified Acquisition Procedures.

(b) Nonmanufacturers. (1) A firm may qualify as a small business concern for a requirement to provide manufactured products or other supply items as a nonmanufacturer if it:

(i) Does not exceed 500 employees (or 150 employees for the Information Technology Value Added Reseller exception to NAICS Code 541519, which is found at § 121.201, footnote 18);

(ii) Is primarily engaged in the retail or wholesale trade and normally sells the type of item being supplied;

(iii) Takes ownership or possession of the item(s) with its personnel, equipment or facilities in a manner consistent with industry practice; and

(iv) Will supply the end item of a small business manufacturer, processor or producer made in the United States, or obtains a waiver of such requirement pursuant to paragraph (b)(5) of this section.

(2) For size purposes, there can be only one manufacturer of the end item being acquired. The manufacturer is the concern which, with its own facilities, performs the primary activities in transforming inorganic or organic substances, including the assembly of parts and components, into the end item being acquired. The end item must possess characteristics which, as a result of mechanical, chemical or human action, it did not possess before the original substances, parts or components were assembled or transformed. The end item may be finished and ready for utilization or consumption, or it may be semifinished as a raw material to be used in further manufacturing. Firms which perform only minimal operations upon the item being procured do not qualify as manufacturers of the end item. Firms that add substances, parts, or components to an existing end item to modify its performance will not be considered the end item manufacturer where those identical modifications can be performed by and are available from the manufacturer of the existing end item:

(i) SBA will evaluate the following factors in determining whether a concern is the manufacturer of the end item:

(A) The proportion of total value in the end item added by the efforts of the concern, excluding costs of overhead, testing, quality control, and profit;

(B) The importance of the elements added by the concern to the function of the end item, regardless of their relative value; and

(C) The concern's technical capabilities; plant, facilities and equipment; production or assembly line processes; packaging and boxing operations; labeling of products; and product warranties.

(ii) Firms that provide computer and other information technology equipment primarily consisting of component parts (such as motherboards, video cards, network cards, memory, power supplies, storage devices, and similar items) who install components totaling less than 50% of the value of the end item are generally not considered the manufacturer of the end item.

(3) The nonmanufacturer rule applies only to procurements that have been assigned a manufacturing or supply NAICS code, or the Information Technology Value Added Resellers (ITVAR) exception to NAICS code 541519. The nonmanufacturer rule does not apply to contracts that have been assigned a service (except for the ITVAR exception to NAICS code 541519), construction, or specialty trade construction NAICS code.

(4) The nonmanufacturer rule applies only to the supply component of a requirement classified as a manufacturing, supply, or ITVAR contract. If a requirement is classified as a service contract, but also has a supply component, the nonmanufacturer rule does not apply to the supply component of the requirement. The rental of an item(s) is a service and should be treated as such in the application of the nonmanufacturer rule and the limitation on subcontracting.

Example 1 to paragraph (b)(4).

A procuring agency seeks to acquire computer integration and maintenance services. Included within that requirement, the agency also seeks to acquire some computer hardware. If the procuring agency determines that the principal nature of the procurement is services and classifies the procurement as a services procurement, the nonmanufacturer rule does not apply to the computer hardware portion of the requirement. This means that while a contractor must meet the applicable performance of work requirement set forth in § 125.6 for the services portion of the contract, the contractor does not have to supply the computer hardware of a small business manufacturer.

Example 2 to paragraph (b)(4).

A procuring agency seeks to acquire computer hardware, as well as computer integration and maintenance services. If the procuring agency determines that the principal nature of the procurement is for supplies and classifies the procurement as a supply procurement, the nonmanufacturer rule applies to the computer hardware portion of the requirement. A firm seeking to qualify as a small business nonmanufacturer must supply the computer hardware manufactured by a small business. Because the requirement is classified as a supply contract, the contractor does not have to meet the performance of work requirement set forth in § 125.6 for the services portion of the contract.

(5) The Administrator or designee may waive the requirement set forth in paragraph (b)(1)(iv) of this section under the following two circumstances:

(i) The contracting officer has determined that no small business manufacturer or processor reasonably can be expected to offer a product meeting the specifications (including period for performance) required by a particular solicitation and SBA reviews and accepts that determination; or

(ii) SBA determines that no small business manufacturer or processor of the product or class of products is available to participate in the Federal procurement market.

(6) The two waiver possibilities identified in paragraph (b)(5) of this section are called “individual” and “class” waivers respectively, and the procedures for requesting and granting them are contained in § 121.1204.

(7) SBA's waiver of the nonmanufacturer rule means that the firm can supply the product of any size business without regard to the place of manufacture. However, SBA's waiver of the nonmanufacturer rule has no effect on requirements external to the Small Business Act which involve domestic sources of supply, such as the Buy American Act or the Trade Agreements Act.

(c) The limitations on subcontracting (performance of work) requirements, the ostensible subcontracting rule, and the nonmanufacturer rule do not apply to small business set-aside acquisitions with an estimated value between the micro-purchase threshold and the simplified acquisition threshold (as both terms are defined in the FAR at 48 CFR 2.101).

(d) Multiple item acquisitions. (1) If at least 50% of the estimated contract value is composed of items that are manufactured by small business concerns, then a waiver of the nonmanufacturer rule is not required. There is no requirement that each and every item acquired in a multiple-item procurement be manufactured by a small business.

(2) If more than 50% of the estimated contract value is composed of items manufactured by other than small concerns, then a waiver is required. SBA may grant a contract specific waiver for one or more items in order to ensure that at least 50% of the value of the products to be supplied by the nonmanufacturer comes from domestic small business manufacturers or are subject to a waiver.

(3) If a small business is both a manufacturer of item(s) and a nonmanufacturer of other item(s), the manufacturer size standard should be applied.

(e) These requirements do not apply to small business concern subcontractors.

§ 121.407 What are the size procedures for multiple item procurements?

If a procurement calls for two or more specific end items or types of services with different size standards and the offeror may submit an offer on any or all end items or types of services, the offeror must meet the size standard for each end item or service item for which it submits an offer. If the procurement calls for more than one specific end item or type of service and an offeror is required to submit an offer on all items, the offeror may qualify as a small business for the procurement if it meets the size standard of the item which accounts for the greatest percentage of the total contract value.

§ 121.408 What are the size procedures for SBA's Certificate of Competency Program?

(a) A firm which applies for a COC must file an “Application for Small Business Size Determination” (SBA Form 355). If the initial review of SBA Form 355 indicates the applicant, including its affiliates, is small for purposes of the COC program, SBA will process the application for COC. If the review indicates the applicant, including its affiliates is other than small SBA will initiate a formal size determination as set forth in § 121.1001(b)(3)(ii). In such a case, SBA will not further process the COC application until a formal size determination is made.

(b) A concern is ineligible for a COC if a formal SBA size determination finds the concern other than small.

§ 121.409 What size standard applies in an unrestricted procurement for Certificate of Competency purposes?

For the purpose of receiving a Certificate of Competency in an unrestricted procurement, the applicable size standard is that corresponding to the NAICS code set forth in the solicitation. The offeror need not be the manufacturer of any of the items acquired.

§ 121.410 What are the size standards for SBA's Section 8(d) Subcontracting Program?

For subcontracting purposes pursuant to sections 8(d) of the Small Business Act, a concern is small for subcontracts which relate to Government procurements if it does not exceed the size standard for the NAICS code that the prime contractor believes best describes the product or service being acquired by the subcontract. However, subcontracts for engineering services awarded under the National Energy Policy Act of 1992 have the same size standard as Military and Aerospace Equipment and Military Weapons under NAICS code 541330.

§ 121.411 What are the size procedures for SBA's Section 8(d) Subcontracting Program?

(a) Prime contractors may rely on the information contained in the System for Award Management (SAM) (or any successor system or equivalent database maintained or sanctioned by SBA) as an accurate representation of a concern's size and ownership characteristics for purposes of maintaining a small business source list.

(b) Even if a concern is on a small business source list, it must still qualify and self-certify as a small business at the time it submits its offer as a section 8(d) subcontractor. Prime contractors (or subcontractors) may accept paper self-certifications as to size and socioeconomic status or a subcontractor's electronic self-certification as to size or socioeconomic status, if the solicitation for the subcontract contains a clause which provides that the subcontractor verifies by submission of the offer that the size or socioeconomic representations and certifications are accurate and complete. Electronic submission may include any method acceptable to the prime contractor (or subcontractor) including, but not limited to, size representations and certifications made in SAM (or any successor system) and electronic conveyance of subcontractor certifications in prime contractor systems in connection with an offer for a subcontract. Prime contractors or subcontractors may not require the use of SAM (or any successor system) for purposes of representing size or socioeconomic status in connection with a subcontract.

(c) Upon determination of the successful subcontract offeror for a competitive subcontract over the simplified acquisition threshold, but prior to award, the prime contractor must inform each unsuccessful subcontract offeror in writing of the name and location of the apparent successful offeror.

(d) The self-certification of a concern subcontracting or proposing to subcontract under section 8(d) of the Small Business Act may be protested by the contracting officer, the prime contractor, the appropriate SBA official or any other interested party.

(e) Presumption of Loss Based on the Total Amount Expended. In every contract, subcontract, cooperative agreement, cooperative research and development agreement, or grant which is set aside, reserved, or otherwise classified as intended for award to small business concerns, there shall be a presumption of loss to the United States based on the total amount expended on the contract, subcontract, cooperative agreement, cooperative research and development agreement, or grant whenever it is established that a business concern other than a small business concern willfully sought and received the award by misrepresentation.

(f) Deemed Certifications. The following actions shall be deemed affirmative, willful and intentional certifications of small business size and status:

(1) Submission of a bid, proposal, application or offer for a Federal grant, contract, subcontract, cooperative agreement, or cooperative research and development agreement reserved, set aside, or otherwise classified as intended for award to small business concerns.

(2) Submission of a bid, proposal, application or offer for a Federal grant, contract, subcontract, cooperative agreement or cooperative research and development agreement which in any way encourages a Federal agency to classify the bid or proposal, if awarded, as an award to a small business concern.

(3) Registration on any Federal electronic database for the purpose of being considered for award of a Federal grant, contract, subcontract, cooperative agreement, or cooperative research and development agreement, as a small business concern.

(g) Signature Requirement. Each offer, proposal, bid, or application for a Federal contract, subcontract, or grant shall contain a certification concerning the small business size and status of a business concern seeking the Federal contract, subcontract or grant. An authorized official must sign the certification on the same page containing the size status claimed by the concern.

(h) Limitation of Liability. Paragraphs (d) through (f) of this section may be determined not to apply in the case of unintentional errors, technical malfunctions, and other similar situations that demonstrate that a misrepresentation of size was not affirmative, intentional, willful or actionable under the False Claims Act, 31 U.S.C. §§ 3729, et seq. A prime contractor acting in good faith should not be held liable for misrepresentations made by its subcontractors regarding the subcontractors' size. Relevant factors to consider in making this determination may include the firm's internal management procedures governing size representation or certification, the clarity or ambiguity of the representation or certification requirement, and the efforts made to correct an incorrect or invalid representation or certification in a timely manner. An individual or firm may not be held liable where government personnel have erroneously identified a concern as small without any representation or certification having been made by the concern and where such identification is made without the knowledge of the individual or firm.

(i) Penalties for Misrepresentation. (1) Suspension or debarment. The SBA suspension and debarment official or the agency suspension and debarment official may suspend or debar a person or concern for misrepresenting a firm's size status pursuant to the procedures set forth in 48 CFR subpart 9.4.

(2) Civil Penalties. Persons or concerns are subject to severe penalties under the False Claims Act, 31 U.S.C. 3729-3733, the Program Fraud Civil Remedies Act, 31 U.S.C. 3801-3812 and any other applicable laws or regulations, including 13 CFR part 142.

(3) Criminal Penalties. Persons or concerns are subject to severe criminal penalties for knowingly misrepresenting the small business size status of a concern in connection with procurement programs pursuant to section 16(d) of the Small Business Act, 15 U.S.C. 645(d), as amended, 18 U.S.C. 1001, 18 U.S.C. 287, and any other applicable laws. Persons or concerns are subject to criminal penalties for knowingly making false statements or misrepresentations to SBA for the purpose of influencing any actions of SBA pursuant to section 16(a) of the Small Business Act, 15 U.S.C. 645(a), as amended, including failure to correct “continuing representations” that are no longer true.

§ 121.412 What are the size procedures for partial small business set-asides?

A firm is required to meet size standard requirements only for the small business set-aside portion of a procurement, and is not required to qualify as a small business for the unrestricted portion.

§ 121.501 What programs for sales or leases of Government property are subject to size determinations?

Sections 121.501 through 121.512 apply to small business size determinations for the purpose of the sale or lease of Government property, including the Timber Sales Program, the Special Salvage Timber Sales Program, and the sale of Government petroleum, coal and uranium.

§ 121.502 What size standards are applicable to programs for sales or leases of Government property?

(a) Unless otherwise specified in this part—

(1) A concern primarily engaged in manufacturing is small for sales or leases of Government property if it does not exceed 500 employees;

(2) A concern not primarily engaged in manufacturing is small for sales or leases of Government property if it has annual receipts not exceeding $9 million.

(b) Size status for such sales and leases is determined by the primary industry of the applicant business concern.

§ 121.503 Are SBA size determinations binding on parties?

Formal size determinations based upon a specific Government sale or lease, or made in response to a request from another Government agency under § 121.901, are binding upon the parties. Other SBA opinions provided to contracting officers or others are only advisory, and are not binding or appealable.

§ 121.504 When does SBA determine the size status of a business concern?

SBA determines the size status of a concern (including its affiliates) as of the date the concern submits a written self-certification that it is small to the Government as part of its initial offer including price where there is a specific sale or lease at issue, or as set forth in § 121.903 if made in response to a request of another Government agency.

§ 121.505 What is the effect of a self-certification?

(a) A contracting officer may accept a concern's self-certification as true for the particular sale or lease involved, in the absence of a written protest by other offerors or other credible information which would cause the contracting officer or SBA to question the size of the concern.

(b) Procedures for protesting the self-certification of an offeror are set forth in §§ 121.1001 through 121.1009.

§ 121.506 What definitions are important for sales or leases of Government-owned timber?

(a) Computation of Market Share means the small business share, expressed as a percentage for a market area, based on the purchase by small business over the preceding 5-year period. The computation is done every five years.

(b) Forest product industry means logging, wood preserving, and the manufacture of lumber and wood related products such as veneer, plywood, hardboard, particle board, or wood pulp, and of products of which lumber or wood related products are the principal raw materials.

(c) Integrated Resource Timber Contracts means contracts that combine product removal and service work when the value of included timber exceeds the value of services.

(d) Logging of timber means felling and bucking, yarding, and/or loading. It does not mean hauling.

(e) Manufacture of logs means, at a minimum, breaking down logs into rough cuts of the finished product.

(f) Sell means, in addition to its usual and customary meaning, the exchange of sawlogs for sawlogs on a product-for-product basis with or without monetary adjustment, and an indirect transfer, such as the sale of the assets of a concern after it has been awarded one or more set-aside sales of timber.

(g) Significant logging of timber means that a concern uses its own employees to perform at least two of the following: felling and bucking, yarding, and loading.

§ 121.507 What are the size standards and other requirements for the purchase of Government-owned timber (other than Special Salvage Timber)?

(a) To be small for purposes of the sale of Government-owned timber (other than Special Salvage Timber) a concern must:

(1) Be primarily engaged in the logging or forest products industry;

(2) Not exceed 500 employees, taking into account its affiliates; and

(3) If it does not intend at the time of the offer to resell the timber—

(i) Agree that it will manufacture the logs with its own facilities or those of another business which meets the requirements of paragraphs (a)(1) and (a)(2) of this section;

(ii) Agree that if it eventually resells the timber, it will resell no more than 30% of the sawtimber volume to other businesses which do not meet the requirements of paragraphs (a)(1) and (a)(2) of this section; and

(iii) Agree that if it becomes acquired or controlled by a business which does not meet the requirements of paragraphs (a)(1) and (a)(2) of this section, it will require as a condition of the acquisition or change of control that the acquiring or controlling business resell at least 70% of the sawtimber volume to businesses which do meet the requirements of paragraphs (a)(1) and (a)(2) of this section; or

(4) If it intends at the time of offer to resell the timber—

(i) Agree that it will not sell more than 30% of such timber (50% of such timber if the concern is an Alaskan business) to a business which does not meet the requirements of paragraphs (a)(1) and (a)(2) of this section; and

(ii) Agree that if it becomes acquired or controlled by a business which does not meet the requirements of paragraphs (a)(1) and (a)(2) of this section, it will require as a condition of the acquisition or change of control that the acquiring or controlling business resell at least 70% of the sawtimber volume (or at least 50% of the sawtimber volume, if it is an Alaskan business) to businesses which meet the requirements of paragraphs (a)(1) and (a)(2) of this section.

(b) For a period of three years following the date upon which a concern purchases timber under a small business set-aside (other than through the Special Salvage Timber Sale program), it must maintain a record of:

(1) The name, address and size status of every concern to which it sells the timber or sawlogs; and

(2) The species, grades and volumes of sawlogs sold.

(c) For a period of three years following the date upon which a concern purchases timber, it must by contract require all small business repurchasers of the sawlogs or timber it purchased under the small business set-aside to maintain the records described in paragraph (b) of this section.

(d) The Director of Government Contracting may waive one or more of the requirements set forth in paragraphs (a)(3) and (a)(4) of this section in limited circumstances where conditions make the requirement(s) impractical or prohibitive. A request for waiver must be made to the Director of Government Contracting and contain facts, arguments, and any appropriate supporting documentation as to why a waiver should be granted.

(e) Sawtimber volume from Integrated Resource Timber Contracts shall be included in the Computation of Market Share and set-aside trigger.

§ 121.508 What are the size standards and other requirements for the purchase of Government-owned Special Salvage Timber?

(a) In order to purchase Government-owned Special Salvage Timber from the United States Forest Service or the Bureau of Land Management as a small business, a concern must:

(1) Be primarily engaged in the logging or forest product industry;

(2) Have, together with its affiliates, no more than twenty-five employees during any pay period for the last twelve months; and

(3) If it does not intend at the time of offer to resell the timber—

(i) Agree that it will manufacture a significant portion of the logs with its own employees; and

(ii) Agree that it will log the timber only with its own employees or with employees of another business which is eligible for award of a Special Salvage Timber sales contract; or

(4) If it intends at the time of offer to resell the timber, agree that it will perform a significant portion of timber logging with its own employees and that it will subcontract the remainder of the timber logging to a concern which is eligible for award of a Special Salvage Timber sales contract.

§ 121.509 What is the size standard for leasing of Government land for coal mining?

A concern is small for this purpose if it:

(a) Together with its affiliates, does not have more than 250 employees;

(b) Maintains management and control of the actual mining operations of the tract; and

(c) Agrees that if it subleases the Government land, it will be to another small business, and that it will require its sublessors to agree to the same.

§ 121.510 What is the size standard for leasing of Government land for uranium mining?

A concern is small for this purpose if it, together with its affiliates, does not have more than 100 employees.

§ 121.511 What is the size standard for buying Government-owned petroleum?

A concern is small for this purpose if it is primarily engaged in petroleum refining and meets the size standard for a petroleum refining business.

§ 121.512 What is the size standard for stockpile purchases?

A concern is small for this purpose if:

(a) It is primarily engaged in the purchase of materials which are not domestic products; and

(b) Its annual receipts, together with its affiliates, do not exceed $76.5 million.

§ 121.601 What is a small business for purposes of admission to SBA's 8(a) Business Development program?

An applicant must not exceed the size standard corresponding to its primary industry classification in order to qualify for admission to SBA's 8(a) Business Development Program.

§ 121.602 At what point in time must a 8(a) BD applicant be small?

A 8(a) BD applicant must be small for its primary industry at the time SBA certifies it for admission into the program.

§ 121.603 How does SBA determine whether a Participant is small for a particular 8(a) BD subcontract?

(a) Self certification by Participant. A 8(a) BD Participant must certify that it qualifies as a small business under the NAICS code assigned to a particular 8(a) BD subcontract as part of its initial offer including price to the procuring agency. The Participant also must submit a copy of its offer, including its self-certification as to size, to the appropriate SBA district office at the same time it submits the offer to the procuring agency. See § 121.404 for the time at which size is determined for, and § 121.406 for the applicability of the nonmanufacturer rule to, 8(a) BD procurements.

(b) Verification of size by SBA. Within 30 days of its receipt of a Participant's size self-certification for a particular 8(a) BD subcontract, the SBA district office serving the geographic area in which the Participant's principal office is located will review the Participant's self-certification and determine if it is small for purposes of that subcontract. The SBA district office will review the Participant's most recent financial statements and other relevant data and then notify the Participant of its decision.

(c) Changes in size between date of self-certification and date of award. (1) Where SBA verifies that the selected Participant is small for a particular procurement, subsequent changes in size up to the date of award, except those due to merger with or acquisition by another business concern, will not affect the firm's size status for that procurement.

(2) Where a Participant has merged with or been acquired by another business concern between the date of its self-certification and the date of award, the concern must recertify its size status, and SBA must verify the new certification before award can occur.

(3) Recertification is not required when the ownership of a concern that is at least 51% owned by an entity ( i.e., tribe, Alaska Native Corporation, or Community Development Corporation) changes to or from a wholly-owned business concern of the same entity, as long as the ultimate owner remains that entity.

(d) Finding Participant to be other than small. (1) A Participant may request a formal size determination (pursuant to §§ 121.1001 through 121.1009) with the SBA Government Contracting Area Office serving the geographic area in which the principal office of the Participant is located within 5 working days of its receipt of notice from the SBA district office that it is not small for a particular 8(a) BD subcontract.

(2) Where the Participant does not timely request a formal size determination, SBA may accept the procurement in support of another Participant, or may rescind its acceptance of the offer for the 8(a) BD program, as appropriate.

§ 121.604 Are 8(a) BD Participants considered small for purposes of other SBA assistance?

A concern which SBA determines to be a small business for the award of a 8(a) BD subcontract will be considered to have met applicable size eligibility requirements of other SBA programs where that assistance directly and primarily relates to the performance of the 8(a) BD subcontract in question.

§ 121.701 What SBIR and STTR programs are subject to size and eligibility determinations and what definitions are important?

(a) These sections apply to SBA's SBIR and STTR programs, 15 U.S.C. 638.

(b) Definitions —(1) Funding agreement officer means a contracting officer, a grants officer, or a cooperative agreement officer.

(2) Funding agreement means any contract, grant or cooperative agreement entered into between any Federal agency and any small business for the purposes of the SBIR or STTR program.

(3) Hedge fund has the meaning given that term in section 13(h)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 1851(h)(2)). The hedge fund must have a place of business located in the United States and be created or organized in the United States, or under the law of the United States or of any State.

(4) Portfolio company means any company that is owned in whole or part by a venture capital operating company, hedge fund, or private equity firm.

(5) Private equity firm has the meaning given the term “private equity fund” in section 13(h)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 1851(h)(2)). The private equity firm must have a place of business located in the United States and be created or organized in the United States, or under the law of the United States or of any State.

(6) Venture capital operating company means an entity described in § 121.103(b)(5)(i), (v), or (vi). The venture capital operating company must have a place of business located in the United States and be created or organized in the United States, or under the law of the United States or of any State.

§ 121.702 What size and eligibility standards are applicable to the SBIR and STTR programs?

To be eligible for award of funding agreements in SBA's SBIR and STTR programs, a business concern must meet the requirements below at the time of award of an SBIR or STTR Phase I or Phase II funding agreement:

(a) Ownership and control for the SBIR program. (1) An SBIR awardee must:

(i) Be a concern which is more than 50% directly owned and controlled by one or more individuals (who are citizens or permanent resident aliens of the United States), other small business concerns (each of which is more than 50% directly owned and controlled by individuals who are citizens or permanent resident aliens of the United States), an Indian tribe, ANC or NHO (or a wholly owned business entity of such tribe, ANC or NHO), or any combination of these;

(ii) Be a concern which is more than 50% owned by multiple venture capital operating companies, hedge funds, private equity firms, or any combination of these (for agencies electing to use the authority in 15 U.S.C. 638(dd)(1)); or

(iii) Be a joint venture in which each entity to the joint venture must meet the requirements set forth in paragraph (a)(1)(i) or (a)(1)(ii) of this section. A joint venture that includes one or more concerns that meet the requirements of paragraph (a)(1)(ii) of this section must comply with § 121.705(b) concerning registration and proposal requirements.

(2) No single venture capital operating company, hedge fund, or private equity firm may own more than 50% of the concern unless that single venture capital operating company, hedge fund, or private equity firm qualifies as a small business concern that is more than 50% directly owned and controlled by individuals who are citizens or permanent resident aliens of the United States.

(3) If an Employee Stock Ownership Plan owns all or part of the concern, each stock trustee and plan member is considered an owner.

(4) If a trust owns all or part of the concern, each trustee and trust beneficiary is considered an owner.

(b) Ownership and control for the STTR program. (1) An STTR awardee must:

(i) Be a concern which is more than 50% directly owned and controlled by one or more individuals (who are citizens or permanent resident aliens of the United States), other small business concerns (each of which is more than 50% directly owned and controlled by individuals who are citizens or permanent resident aliens of the United States), an Indian tribe, ANC or NHO (or a wholly owned business entity of such tribe, ANC or NHO), or any combination of these; or

(ii) Be a joint venture in which each entity to the joint venture must meet the requirements set forth in paragraph (b)(1)(i) of this section.

(2) If an Employee Stock Ownership Plan owns all or part of the concern, each stock trustee and plan member is considered an owner.

(3) If a trust owns all or part of the concern, each trustee and trust beneficiary is considered an owner.

(c) Size and affiliation. An SBIR or STTR awardee, together with its affiliates, must not have more than 500 employees. Concerns and entities are affiliates of each other when one controls or has the power to control the other, or a third party or parties controls or has the power to control both. It does not matter whether control is exercised, so long as the power to control exists. For the purposes of the SBIR and STTR programs, the following bases of affiliation apply:

(1) Affiliation based on ownership. For determining affiliation based on equity ownership, a concern is an affiliate of an individual, concern, or entity that owns or has the power to control more than 50 percent of the concern's voting equity. However, SBA may find a concern an affiliate of an individual, concern, or entity that owns or has the power to control 40% or more of the voting equity based upon the totality of circumstances. If no individual, concern, or entity is found to control, SBA will deem the Board of Directors to be in control of the concern.

(2) Affiliation arising under stock options, convertible securities, and agreements to merge. In determining size, SBA considers stock options, convertible securities, and agreements to merge (including agreements in principle) to have a present effect on the power to control a concern. SBA treats such options, convertible securities, and agreements as though the rights granted have been exercised.

(i) Agreements to open or continue negotiations towards the possibility of a merger or a sale of stock at some later date are not considered “agreements in principle” and are thus not given present effect.

(ii) Options, convertible securities, and agreements that are subject to conditions precedent which are incapable of fulfillment, speculative, conjectural, or unenforceable under state or Federal law, or where the probability of the transaction (or exercise of the rights) occurring is shown to be extremely remote, are not given present effect.

(iii) An individual, concern or other entity that controls one or more other concerns cannot use options, convertible securities, or agreements to appear to terminate such control before actually doing so. SBA will not give present effect to individuals', concerns' or other entities' ability to divest all or part of their ownership interest in order to avoid a finding of affiliation.

(3) Affiliation based on common management. Affiliation arises where the CEO or President of a concern (or other officers, managing members, or partners who control the management of the concern) also controls the management of one or more other concerns. Affiliation also arises where a single individual, concern, or entity that controls the board of directors of one concern also controls the board of directors or management of one or more other concerns.

(4) Affiliation based on identity of interest. Affiliation may arise among two or more persons (including any individual, concern or other entity) with an identity of interest. An individual, concern or entity may rebut a determination of identity of interest with evidence showing that the interests deemed to be one are in fact separate.

(i) SBA may presume an identity of interest between family members with identical or substantially identical business or economic interests (such as where the family members operate concerns in the same or similar industry in the same geographic area).

(ii) SBA may presume an identity of interest based upon economic dependence if the SBIR/STTR awardee relies upon another concern or entity for 70% or more of its receipts.

(iii) An SBIR or STTR awardee is not affiliated with a portfolio company of a venture capital operating company, hedge fund, or private equity firm, solely on the basis of one or more shared investors, though affiliation may be found for other reasons.

(5) Affiliation based on the newly organized concern rule. Affiliation may arise where former or current officers, directors, principal stockholders, managing members, general partners, or key employees of one concern organize a new concern in the same or related industry or field of operation, and serve as the new concern's officers, directors, principal stockholders, managing members, general partners, or key employees, and the one concern is furnishing or will furnish the new concern with contracts, financial or technical assistance, indemnification on bid or performance bonds, and/or other facilities, whether for a fee or otherwise. A concern may rebut such an affiliation determination by demonstrating a clear line of fracture between the two concerns. A “key employee” is an employee who, because of his/her position in the concern, has a critical influence in or substantive control over the operations or management of the concern. A concern will be considered “new” for the purpose of this rule if it has been actively operating continuously for less than one year.

(6) Size requirement for joint ventures. Two or more small business concerns may submit an application as a joint venture. The joint venture will qualify as small as long as each concern is small under the size standard for the SBIR program, found at § 121.702(c), or the joint venture meets the exception at § 121.103(h)(3)(ii) for two firms approved to be a mentor and protégé under SBA's All Small Mentor-Protégé Program.

(7) Affiliation based on the ostensible subcontractor rule. A concern with an other than small ostensible subcontractor cannot be considered a small business concern for SBIR and STTR awards. An ostensible subcontractor is a subcontractor or subgrantee that performs primary and vital requirements of a funding agreement ( i.e., those requirements associated with the principal purpose of the funding agreement), or a subcontractor or subgrantee upon which the concern is unusually reliant.

(i) All aspects of the relationship between the concern and the subcontractor are considered, including, but not limited to, the terms of the proposal (such as management, technical responsibilities, and the percentage of subcontracted work) and agreements between the concern and subcontractor or subgrantee (such as bonding assistance or the teaming agreement).

(ii) To determine whether a subcontractor performs primary and vital requirements of a funding agreement, SBA will also consider whether the concern's proposal complies with the performance requirements of the SBIR or STTR program.

(iii) The prime and any small business ostensible subcontractor both must comply individually with the ownership and control requirements in paragraphs (a) and (b) of this section, as applicable.

(8) Affiliation based on license agreements. SBA will consider whether there is a license agreement concerning a product or trademark which is critical to operation of the licensee. The license agreement will not cause the licensor to be affiliated with the licensee if the licensee has the right to profit from its efforts and bears the risk of loss. Affiliation may arise, however, through other means, such as common ownership or common management.

(9) Exception to affiliation for portfolio companies. If a venture capital operating company, hedge fund, or private equity firm that is determined to be affiliated with an awardee is a minority investor in the awardee, the awardee is not affiliated with a portfolio company of the venture capital operating company, hedge fund, or private equity firm, unless:

(i) The venture capital operating company, hedge fund, or private equity firm owns a majority of the portfolio company; or

(ii) The venture capital operating company, hedge fund, or private equity firms holds a majority of the seats of the board of directors of the portfolio company.

(10) Totality of the circumstances. In determining whether affiliation exists, SBA may consider the totality of the circumstances, and may find affiliation even though no single factor is sufficient to constitute affiliation.

(11) Exception to affiliation for certain investment companies. There is an exception to affiliation for Small Business Investment Companies (SBICs) that invest in SBIR or STTR awardees, in accordance with 13 CFR 121.103(b)(1).

(d) Calculating ownership and control. SBA will review the small business' equity ownership on a fully diluted basis for purposes of determining ownership, control and affiliation in the SBIR and STTR programs. This means that SBA will consider the total number of shares or equity that would be outstanding if all possible sources of conversion were exercised, including, but not limited to: Outstanding common stock or equity, outstanding preferred stock (on a converted to common basis) or equity, outstanding warrants (on an as exercised and converted to common basis), outstanding options and options reserved for future grants, and any other convertible securities on an as converted to common basis.

§ 121.703 Are formal size determinations binding on parties?

Size determinations by authorized SBA officials are formal actions based upon a specific funding agreement, and are binding upon the parties. Other SBA opinions provided to funding agreement officers or others, are only advisory, and are not binding or appealable.

§ 121.704 When does SBA determine the size and eligibility status of a business concern?

(a) The size and eligibility status of a concern for the purpose of a funding agreement award under the SBIR and STTR programs is determined at the time of award for both Phase I and Phase II SBIR and STTR awards, or on the date of the request for a size determination, if an award is pending.

(b) A concern that qualified as a small business at the time it receives an SBIR or STTR funding agreement is considered a small business throughout the life of that specific funding agreement. Where a concern grows to be other than small, the funding agreement agency may exercise the options on the award that is a contract, grant or cooperative agreement or issue a continuation on a grant or cooperative agreement and still count the award as an award to a small business under the SBIR or STTR program. However, the following exceptions apply:

(1) In the case of a merger or acquisition, the awardee must, within 30 days of the transaction becoming final (or the approved funding agreement novation if a novation is required), recertify its small business size status to the funding agreement agency or inform the funding agreement agency that it is other than small. If the awardee is other than small, the agency can no longer fund the options or issue a continuation pursuant to the funding agreement, from that point forward, with SBIR or STTR funds. Funding agreement novations for reasons other than a merger or acquisition do not necessarily require re-certification. The funding agreement agency and the awardee must immediately revise all applicable Federal contract and grant databases to reflect the new size status from that point forward.

(2) For the purposes of SBIR and STTR funding agreements with durations of more than five years, a funding agreement officer must request that a business concern re-certify its small business size status no more than 120 days prior to the end of the fifth year of the funding agreement, and no more than 120 days prior to exercising any option or issuing any continuation. If the awardee certifies that it is other than small, the funding agreement agency can no longer fund the options or issue a continuation pursuant to the funding agreement with SBIR or STTR funds. The funding agreement agency and the awardee must immediately revise all applicable Federal contract and grant databases to reflect the new size status from that point forward.

(c) Re-certification does not change the terms and conditions of the funding agreement. The requirements in effect at the time of award remain in effect throughout the life of the funding agreement.

(d) A request for a size re-certification shall include the size standard in effect at the time of re-certification.

§ 121.705 Must a business concern self-certify its size and eligibility status?

(a) A business concern must self-certify that it meets the eligibility requirements set forth in § 121.702 for a Phase I or Phase II SBIR or STTR funding agreement.

(b) A business concern that is more than 50% owned by multiple venture capital operating companies, hedge funds, or private equity firms and a joint venture where one or more parties to the joint venture is more than 50% owned by multiple venture capital operating companies, hedge funds, or private equity firms must be registered with SBA as of the date it submits its initial proposal (or other formal response) to a Phase I or Phase II SBIR announcement or solicitation. The concern must indicate in any SBIR proposal or application that it is registered with SBA as majority-owned by multiple venture capital operating companies, hedge funds, or private equity firms.

(c) A small business concern that did not meet the requirements of paragraph (b) of this section at the time of its SBIR proposal or application must notify the funding agreement officer if, on the date of award, the concern is more than 50% owned by multiple venture capital operating companies, hedge funds, or private equity firms.

(1) The concern is still eligible to receive the award if it becomes majority-owned by multiple venture capital operating companies, hedge funds, or private equity firms after the time it submitted its initial proposal (or other formal response) to a Phase I or Phase II SBIR announcement or solicitation if the agency makes the award on or after the date that is 9 months from the end of the period for submitting applications under the SBIR solicitation.

(2) This small business, known as a covered small business concern, would have to certify that it meets the requirements of the SBIR program set forth in §§ 121.702(a)(1)(ii) or 121.702(a)(1)(iii), and 121.702(a)(2) and 121.702(c) at the time of award of the funding agreement.

(d) A funding agreement officer may accept a concern's self-certification as true for the particular funding agreement involved in the absence of a written protest or other credible information which would cause the funding agreement officer or SBA to question the size or eligibility of the concern.

(e) Procedures for protesting an awardee's self-certification are set forth in §§ 121.1001 through 121.1009. In adjudicating a protest, SBA may address both the size status and eligibility of the SBIR or STTR awardee.