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DoD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation (FAR) to implement the statutory requirements at 15 U.S.C. 644(e)(4)(B)(i) and 15 U.S.C. 644(q)(1)(B) as implemented by the Small Business Administration (SBA) final rule published on October 16, 2020 (85 FR 66146). The statute requires contracting officers to consider the capabilities and past performance of first-tier subcontractors for bundled or consolidated contracts, and to consider the capabilities and past performance of first-tier subcontractors for multiple award contracts valued above the substantial bundling threshold of the Federal agency.  SBA’s final rule also gives contracting officers discretion to consider past performance and experience of first-tier subcontractors for other procurements where the first-tier subcontractors are specifically identified in the proposal where appropriate.

Additionally this rule will implement section 868 of the National Defense Authorization Act for fiscal year 2021 as implemented in SBA’s final rule published on July 22, 2022 (87 FR 43731). Section 868 provided two methods for small businesses to obtain past performance: (1) a small business may use the past performance of a joint venture of which it is a member, provided the small business worked on the joint venture’s contract(s), and (2) a small business may use past performance it obtained as a first-tier subcontractor from a prime contractor when specifically identified under a subcontracting plan for the contract. This rule promotes equity in Federal procurement.