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    Government Contracting Database

    Certificate of Competency

    The Small Business Act was amended in 1977 to ensure that all findings of nonresponsibility are referred to the SBA for consideration under the Certificate of Competency (COC) program. See Pub.L. 95-89, amending 15 U.S.C. 637(b)(7). 

    The legislative history of Public Law 95-89 indicates that Congress broadened the concept of responsibility “to abate continuing discrimination against small businesses `solely because of their smallness and disabilities allegedly resulting from that fact.’ Siller Brothers, Incorporated v. United States, 655 F.2d 1039, 1044 (Ct.Cl. 1981)….” Rmtc Sys., Inc., GSBCA No. 12346-P-R, 93-3 B.C.A. (CCH) ¶ 26199 (June 21, 1993). It is undeniable that small businesses generally are at a severe disadvantage in competing with larger, established firms, particularly regarding their financial resources and ability to obtain bonding. Congress, therefore, expanded the scope of SBA authority to ensure that procuring agencies do not brand small firms as nonresponsible without resort to the Certificate of Competency program. H.R. Rep. No. 95-1, 95th Cong., 1st Sess. 13, reprinted in 1977 U.S. Code Cong. and Ad. News 821, 833. 

    Where the SBA finds a referred contractor to be responsible for the purpose of receiving and performing a specific government contract, it will issue a Certificate of Competency which is conclusive on the procuring agency. 15 U.S.C. § 637(b)(7)(C) (Supp. 1989); Youngdale Construction Co., Comp.Gen.Dec. B-219439, 85-2 C.P.D. 473 (1985). In this event, the contracting officer must award the contract to the small business offeror. Id.; 48 C.F.R. 19.602-4(b) (1988). 

    Neither the SBA nor the procuring agency may create exceptions to the statutory requirement for referral of responsibility determinations to the SBA for consideration under the Certificate of Competency program. 15 U.S.C. 637(b)(7) (Supp. 1989); Sess Construction Co., 64 Comp.Gen. 355, 85-1 C.P.D. 319 (1985); Small Business Administration, Comp.Gen.Dec. B-219654.3, 86-1 C.P.D. 420 (1986). Because the determination of the SBA on such matters is binding on the procuring agency and conclusive with respect to all elements of responsibility of prospective small business contractors, a contracting officer’s failure to comply with the relevant statute and regulations denies the contractor the full and impartial consideration to which it is entitled in the bid evaluation process. 

    Updated: June 1, 2018 

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