Small Business Size Standards: Waiver of the Nonmanufacturer Rule

AGENCY:

Small Business Administration.

ACTION:

Notice of termination of waiver of the Nonmanufacturer Rule for Power-Driven Handtools Manufacturing.

SUMMARY:

The U.S. Small Business Administration (SBA) is terminating the waiver of the Nonmanufacturer Rule for Power-Driven Handtools 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, SBA's Very Small Business Program or 8(a) businesses to provide the products of small business manufacturers or process on such contracts.

DATES:

This termination of waiver is effective on November 18, 2004.

FOR FURTHER INFORMATION CONTACT:

Edith Butler, Program Analyst, by telephone at (202) 619-0422; by FAX at (202) 481-1788; or by e-mail at edith.butler@sba.gov.

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, SBA's Very Small Business Program 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 June 29, 2004 to waive the Nonmanufacturer Rule for Power-Driven Handtools Manufacturing. In response, on July 28, 2004, SBA published in the Federal Register, and FedBizOpps notices of intent to the waiver of the Nonmanufacturer Rule for Power-Driven Handtools Manufacturing.

In responses to these notices, SBA discovered the existence of a small business manufacturer of that 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 Power-Driven Handtools Manufacturing, NAICS 333991.

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