05-17585. Small Business Size Standards: Waiver of the Nonmanufacturer Rule

AGENCY:

Small Business Administration.

ACTION:

Notice to terminate waiver of the Nonmanufacturer Rule for Sporting and Athletic Goods Manufacturing.

SUMMARY:

The U.S. Small Business Administration (SBA) is terminating the waiver of the Nonmanufacturer Rule for Sporting and Athletic Goods Manufacturing based on our recent discovery of a small business manufacturer for this class of products. Terminating this waiver will require recipients of contracts set aside for small businesses, service-disabled veteran-owned small businesses, or SBA's 8(a) Business Development Program to provide the products of small business manufacturers or processors on such contracts.

DATES:

This waiver is effective September 20, 2005.

FOR FURTHER INFORMATION CONTACT:

Edith Butler, Program Analyst, by telephone at [phone]; by FAX at [phone]; or by e-mail at [e-mail].

SUPPLEMENTARY INFORMATION:

Section 8(a)(17) of the Small Business Act, (Act) 15 U.S.C. 637(a)(17), requires that recipients of Federal contracts set aside for small businesses, service-disabled veteran-owned small businesses, or SBA's 8(a) Business Development Program provide the product of a small business manufacturer or processor, if the recipient is other than the actual manufacturer or processor of the product. This requirement is commonly referred to as the Nonmanufacturer Rule.

The SBA regulations imposing this requirement are found at 13 CFR 121.406(b). Section 8(a)(17)(b)(iv) of the Act authorizes SBA to waive the Nonmanufacturer Rule for any “class of products” for which there are no small business manufacturers or processors available to participate in the Federal market.

As implemented in SBA's regulations at 13 CFR 121.1204, in order to be considered available to participate in the Federal market for a class of products, a small business manufacturer must have submitted a proposal for a contract solicitation or received a contract from the Federal government within the last 24 months. The SBA defines “class of products” based on six digit coding systems. The first coding system is the Office of Management and Budget North American Industry Classification System (NAICS). The second is the Product and Service Code established by the Federal Procurement Data System.

The SBA received a request on July 15, 2004 to waive the Nonmanufacturer Rule for Sporting and Athletic Goods Manufacturing. In response, on July 30, 2004, SBA published in the Federal Register a notice of intent to the waiver of the Nonmanufacturer Rule for Sporting and Athletic Goods Manufacturing. SBA explained in the notice that it was soliciting comments and sources of small business manufacturers of this class of products. In response to this notice, comments were received from interested parties. SBA had determined from these sources that there were no small business manufacturers of this class of products, and therefore granted the waiver of the Nonmanufacturer Rule for Sporting and Athletic Goods Manufacturing, NAICS 339920.

Recently, SBA discovered the existence of a small business manufacturer of this class of products. Accordingly, based on the available information, SBA has determined that there is a small business manufacturer of this class of products, and is therefore terminating the class waiver of the Nonmanufacturer Rule for Sporting and Athletic Goods Manufacturing, NAICS 339920.

Authority: 15 U.S.C. 637(a)(17).

Dated: August 25, 2005.

Nancyellen Gentile,

Acting Associate Administrator for Government Contracting.