The Small Business Administration’s (SBA) ostensible subcontractor rule remains one of the most consequential — and misunderstood — affiliation principles in federal procurement. For small businesses pursuing set-aside contracts, failing to navigate this rule properly can result in bid protests, loss of eligibility, and even contract termination.

What Is the Ostensible Subcontractor Rule?

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On May 2, 2025, the U.S. Small Business Administration (SBA) Office of Hearings and Appeals (OHA) issued a significant decision in Size Appeal of Bowhead Enterprise, Science, and Technology, LLC, SBA No. SIZ-6352. The decision reinforces a critical defense against ostensible subcontractor affiliation allegations: demonstrating compliance with the SBA’s limitation on subcontracting requirements.

As federal contractors continue to navigate the post-pandemic compliance landscape, a recurring issue has emerged in government audits and incurred cost reviews: whether and how contractors must credit the government for Paycheck Protection Program (PPP) loan forgiveness amounts received during the performance of cost-reimbursement contracts. The issue has raised significant questions regarding allowability, allocability, and

Small businesses are the backbone of the U.S. economy, and the federal government offers a range of programs to support their growth — particularly in the realm of government contracting. One of the most strategic tools available to small firms is the U.S. Small Business Administration’s (SBA) Mentor-Protégé Program (MPP). This program can provide powerful

In the highly competitive world of federal government contracting, a firm’s small business size or socioeconomic status can determine its eligibility for lucrative set-aside contracts. For competitors and interested parties, the ability to challenge a company’s claimed size or status is a critical tool for ensuring compliance with the Small Business Act and maintaining the

The Department of Justice (DOJ) recently announced that it obtained more than $2.68 billion in False Claims Act (FCA) settlements and judgments in the fiscal year ending September 23, 2023. DOJ reports that “matters that involved the health care industry” again comprised the largest portion of these FCA recoveries, but that “pandemic fraud” recoveries also

Section 864 of the National Defense Authorization Act for Fiscal Year 2022 authorized the U.S. Small Business Administration’s (SBA) Office of Hearings and Appeals (OHA) to decide all appeals from Historically Underutilized Business Zone (HUBZone) status protest determinations, which are currently decided by SBA’s associate administrator of Government Contracting and Business Development. The SBA recently