New FAR Council Proposed Rule Will Require Women-Owned Concerns to Be Certified by the Small Business Administration

5 min

On October 7, 2021, the U.S. Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA) proposed to amend the Federal Acquisition Regulation (FAR) to implement section 825(a)(1) of the Carl Levin and Howard P. ''Buck'' McKeon National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2015. Section 825 requires women-owned small business (WOSB) concerns and economically disadvantaged women-owned small business (EDWOSB) concerns to be certified by the Small Business Administration (SBA), a federal agency, a state government, or a national certifying entity approved by SBA in the WOSB Program to be eligible for set-aside or sole-source awards. The SBA previously implemented Section 825 through the issuance of final rule 85 FR 27650, in which the SBA amended 13 CFR part 127 to require WOSBs and EDWOSBs to be certified by the SBA or a third-party certifier as set forth in Section 825 before becoming eligible for set-aside or sole-source awards.

The proposed rule amends numerous FAR sections to effect Section 825. Upon issuance of the final rule, the following changes, among others, will be implemented:

  • Within FAR 2.101, the definitions of "Economically disadvantaged women-owned small business concern" and "Women-owned small business concern" will be amended to add a requirement that the concern be certified by the SBA or an approved third-party certifier in accordance with 13 CFR 127.300 prior to being considered eligible under the WOSB Program.
  • FAR 19.308(d), "Protesting a firm's status as an EDWOSB concern or WOSB concern eligible under the WOSB Program," will be amended to require a protest be submitted by email to SBA at wosbprotest@sba.gov. FAR 19.308 will also require protesters challenging the status of an EDWOSB or WOSB to present evidence that the concern is not at least 51 percent owned and controlled by one or more economically disadvantaged women who are United States citizens, based on the requirements of 13 CFR part 127.
  • FAR 19.1503, "Status," will be amended to require contracting officers to verify a concern's designation as a certified WOSB or EDWOSB in the Dynamic Small Business Search (DSBS) at https://web.sba.gov/pro-net/search/dsp_dsbs.cfm. The designation will also appear in the System for Award Management (SAM) after issuance of the final rule.
  • FAR 19.1505, "Set-aside procedures," will be amended to allow an offeror to submit an offer while awaiting SBA or third-party certification under the WOSB Program. FAR 19.1505 will also provide the contracting officer with guidance if an apparently successful offeror's certification is pending under the WOSB Program. Specifically, prior to the award the contracting officer shall verify that the apparently successful offeror is certified in SAM or DSBS. If the apparently successful offeror's EDWOSB or WOSB certification is pending in DSBS, the contracting officer will be required to notify SBA's Director/Government Contracting and request SBA's eligibility determination. Within 15 days from the date of the contracting officer's notification, SBA is expected to make a determination regarding the offeror's eligibility status as an EDWOSB or WOSB. If the contracting officer does not receive a determination from SBA within that period, the contracting officer, at their discretion, may provide SBA additional time to make a determination, or proceed with the award to the next-highest evaluated offeror. Contracting officers will be prohibited from making award to an offeror that is not a certified EDWOSB or WOSB concern eligible under the WOSB program.
  • FAR 19.1506, "Women-Owned Small Business Program sole-source awards," will reflect that a contracting officer can make a sole-source award only to a concern that has been certified pursuant to 13 CFR 127.300 as an EDWOSB or WOSB. FAR 19.1506 will also prohibit contracting officers from requesting an eligibility determination from SBA on pending certification applications for EDWOSB or WOSB sole-source awards.
  • FAR 52.212–3, "Offeror Representations and Certifications Commercial Items," will be amended to remove the representation for WOSB concerns and EDWOSB concerns eligible under the WOSB Program.
  • FAR 52.219–28, "Post-Award Small Business Program Re-representation," will be amended to remove the re-representation for WOSB concerns and EDWOSB concerns eligible under the WOSB Program.

These changes will apply to all EDWOSB and WOSB set-asides and sole-source awards, including those below the simplified acquisition threshold (SAT) and contracts for the acquisition of commercial items, including commercially available off-the-shelf (COTS) items.

One of the largest ramifications of these changes is that contracting officers will be required to affirmatively check SAM or DSBS to determine if an EDWOSB or WOSB concern is certified or has a pending application for certification in DSBS instead of checking that all required documentation has been submitted to the now defunct WOSB Repository.

Furthermore, contracting officers for set-aside procurements will have to contact SBA should the apparently successful offeror have a pending application for certification. SBA is expected to make a determination regarding the offeror's status as an EDWOSB or WOSB eligible under the WOSB program within 15 days. If the contracting officer does not receive a determination from SBA within 15 days, the contracting officer may either (1) provide SBA additional time to make a determination or (2) proceed with the award to the next-highest evaluated offeror. For EDWOSB or WOSB set-asides and sole-source awards, the award can be made only to an EDWOSB or WOSB certified concern.

The proposed rule increases the importance for all EDWOSBs and WOSBs to receive SBA or third-party certification as soon as possible, preferably by the time of proposal submission, in order to remain eligible for set-aside and sole-source awards.