• R.D. Lieberman,Consultant

Even if Not Set Aside for Small Business, Sometimes a Contractor May Appeal the NAICS Code

A recent appeal of a North American Industry Classification System (“NAICS”) code demonstrates that there are certain circumstances where a contractor may appeal the code, even if it is contained in a procurement that is not set aside for small business. Keystone Turbine Servs, LLC, SBA No. NAICS-A5996, April 5, 2019. In Keystone, the appellant appealed a NAICS code of 488190 (Other Support Activities for Air Transportation with a size standard of $32.5 million in average annual receipts), urging that the correct NAICS code was 336412 (Aircraft Engine and Parts Manufacturing, size standard 1,500 employees). The procurement was issued on a full-and-open basis and was not restricted to small business.

The Contracting officer suggested that Keystone was not adversely affected by the NAICS code, and therefore lacked standing to appeal, because the procurement was not set aside for small business. The Office of Hearings and Appeals (OHA-which considered this appeal), rejected this argument, noting that SBA regulations permit a prospective offeror to challenge an assigned NAICS code “regardless of whether the procurement is reserved for small businesses or unrestricted.” 13 CFR § 1103(a)(1). OHA cited Milani Constr, LLC, SBA No. NAICS-5749 (2016), which states that “NAICS code appeals may be filed on unrestricted procurements if the appellant is seeking a change in NAICS code designation which would render it a small business for the subject procurement.”

OHA found that Keystone, the Appellant, had standing to bring this NAICS appeal, even though the procurement is unrestricted.

Takeaway. Even if a procurement is not set aside for small business, a company may appeal a NAICS code if a change to the proper code would render that company a small business for that procurement.

For other helpful suggestions on government contracting, visit:

Richard D. Lieberman’s FAR Consulting & Training at https://www.richarddlieberman.com/, and Mistakes in Government Contracting at https://richarddlieberman.wixsite.com/mistakes

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The website of Richard Donald Lieberman, a government contracts consultant and retired attorney who is the author of both "The 100 Worst Mistakes in Government Contracting" (with Jason Morgan) and "The 100 Worst Government Mistakes in Government Contracting." Richard Lieberman concentrates on Federal Acquisition Regulation (FAR) consulting and training, including  commercial item contracting (FAR Part 12), compliance with proposal requirements (FAR Part 15 negotiated procurement), sealed bidding (FAR Part 14), compliance with solicitation requirements, contract administration (FAR Part 42), contract modifications and changes (FAR Part 43), subcontracting and flowdown requirements (FAR Part 44), government property (FAR Part 45), quality assurance (FAR Part 46), obtaining invoiced payments owed to contractors,  and other compliance with the FAR. Mr.Lieberman is also involved in numerous community service activities.  See LinkedIn profile at https://www.linkedin.com/in/richard-d-lieberman-3a25257a/.This website and blog are for educational and information purposes only.  Nothing posted on this website constitutes legal advice, which can only be obtained from a qualified attorney. Website Owner/Consultant does not engage in the practice of law and will not provide legal advice or legal services based on competence and standing in the law. Legal filings and other aspects of a legal practice must be performed by an appropriate attorney. Using this website does not establish an attorney-client relationship. Although the author strives to present accurate information, the information provided on this site is not guaranteed to be complete, correct or up-to-date.  The views expressed on this blog are solely those of the author. FAR Consulting & Training, Bethesda, Maryland, Tel. 202-520-5780, rliebermanconsultant@gmail.com

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