Federal Contracting Made Easy's Podcast

All government contractors need to understand the ostensible subcontractor rule and how SBA makes the determination.  This is especially true for new government contractors who lack past performance.  Even if a prime contractor is following the limitations on subcontracting, it does not mean that SBA cannot find affiliation between them.  Small business government contractors that rely too much on another business for subcontracting could raise concern for affiliation under the Ostensible Subcontractor Rule. What is Ostensible Subcontractor Rule? Ostensible contractor affiliate happens when a small business holds a prime contract, but a subcontractor ends up controlling the work.  SBA will review whether the subcontractor performed the primary and vital work of the contract.  If the subcontractor performs the primary and vital work on the contract, then SBA will deem that the small prime contractor is affiliated with the subcontractor based on the ostensible subcontractor rule.  The Ostensible subcontractor R