Set-asides for overseas work

      Under a new proposed rule, the Federal Acquisition Regulation Council officially endorsed allowing federal contracting officers to use their discretion in using set-asides and sole-source procedures for small business contracts performed overseas.

      Comments are due by Oct. 11.

      The rule aims to clarify a point of confusion in overseas contracts.

      While there is language in FAR part 19 subpart 19.6 that applies only within the U.S. or its outlying areas, some contracting officers interpret that language broadly to mean no set-asides or sole-source procedures for overseas procurements.

      “This proposed rule will clarify that contracting officers are allowed, but not required, to use the set-aside and sole-source procedures of FAR part 19 for overseas procurements,” the Federal Register notice states.

      While Small Business Administration regulations do not explicitly state that such set-asides are discretionary, the SBA made its position known in documents in 2013 and 2016.

     The proposed rule may help stimulate more overseas work by small vendors, but it is not a sure thing.

     Currently, small firms are awarded less than 1% of the 1.6 million overseas contract awards a year, the notice said.

      Set-asides for small firms can only be used when there is a reasonable expectation that at least two small vendors will submit offers at a fair market price. Sole-source awards must be at a fair and reasonable price.

More Information:
Federal Register proposed rule: https://bit.ly/2N4CQc9

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