C.F.R. » Title 13 » CHAPTER I—SMALL BUSINESS ADMINISTRATION › PART 125—GOVERNMENT CONTRACTING PROGRAMS

13 C.F.R. § 125.13

What restrictions apply to fees for representatives of applicants and participants in SBA's 8(a) BD, HUBZone, WOSB and VetCert programs?

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(a) The compensation received by any packager, agent, or representative of a concern applying for 8(a) BD, HUBZone, WOSB/EDWOSB, or VOSB/SDVOSB certification in exchange for assisting the applicant in obtaining such certification must be reasonable in light of the service(s) performed by the packager, agent, or representative.

(b) The compensation received by any packager, agent, or representative of a certified 8(a) BD, HUBZone small business concern, WOSB/EDWOSB, or VOSB/SDVOSB in exchange for assisting the concern in obtaining any small business contracts, orders, BPAs, BAs, or BOAs must be reasonable in light of the service(s) performed by the packager, agent, or representative, and cannot be a fee that is a percentage of the gross value of the contract, order, BPA, BA or BOA.

(c) For good cause, SBA may initiate proceedings to suspend or revoke a packager's, agent's, or representative's privilege to assist applicants obtain SBA certification and assist certified small business concerns obtain contracts, orders, or any other assistance to support participation in the 8(a) BD, HUBZone, WOSB or VetCert programs. Good cause is defined in § 103.4 of this chapter.

(1) SBA may send a “show cause” letter requesting the agent or representative to demonstrate why the agent or representative should not be suspended or proposed for revocation, or may immediately send a written notice suspending or proposing revocation, depending upon the evidence in the administrative record. The notice will include a discussion of the relevant facts and the reason(s) why SBA believes that good cause exists.

(2) Unless SBA specifies a different time in the notice, the agent or representative must respond to the notice within 30 calendar days of the date of the notice with any facts or arguments showing why good cause does not exist. The agent or representative may request additional time to respond, which SBA may grant in its discretion.

(3) After considering the agent's or representative's response, SBA will issue a final determination, setting forth the reasons for this decision and, if a suspension continues to be effective or a revocation is implemented, the term of the suspension or revocation.

(d) The relevant SBA program office may refer a packager, agent, or other representative to SBA's Suspension and Debarment Official for possible Government-wide suspension or debarment where appropriate, including where it appears that the packager, agent, or representative assisted an applicant or certified small business concern to submit information to SBA that the packager, agent, or representative knew to be false or materially misleading.

[89 FR 102495, Dec. 17, 2024]
Notes of Decisions
Cited in 11 cases (4 in the last 5 years), 2017–2024 · leading case: Xotech, LLC v. United States
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Xotech, LLC v. United States (2020) cafc · cites it 3× “Because we agree with the Claims Court that service-disa- bled veterans do not control “all decisions” of XOtech as re- quired by 13 C.F.R. § 125.13 (d), we affirm. BACKGROUND I “In an effort to encourage small businesses, Congress has mandated that federal agencies restrict…”
United States v. Strock (2020) ca2 “” 13 C.F.R. § 125.13 (a). “At the time that a service-disabled veteran-owned small business concern submits its offer” to perform government contracting work, “it must represent to the contracting officer that it is a [SDVOSB].”
Veterans Contracting Group, Inc. v. United States (2017) uscfc “Montano from controlling the corporation, as required by 13 C.F.R. § 125.13 . See AR 2-8 to -10. Veterans has stated that it appealed SBA’s decision on August 1, 2017.”
Xotech, LLC v. United States (2019) uscfc · cites it 6× “determination that XOtech is ineligible to compete for contracts set aside for service- disabled-veteran-owned (“SDVO”) contractors because XOtech does not satisfy the regulatory requirement that a service-disabled veteran control “all decisions of the limited liability company”…”
United States v. NEARY (2021) njd · cites it 5× “” 13 C.F.R. § 125.13 (a). Relevant here, “[i]n the case of a limited liability company, one or more service-disabled veterans .”
Veterans Contracting Group, Inc. v. United States (2017) uscfc · cites it 4× “” 13 C.F.R. § 125.13 (a). In the specific case of corporations, “service- disabled veterans .”
Superior Optical Labs, Inc. v. United States (2022) uscfc · cites it 2× “Bodart’s ability to make all business decisions and exercise complete control over Superior under 13 C.F.R. § 125.13 , as Mr. Bodart would have to obtain the consent of Essilor, a non-SDVOSB, before implementing these decisions.”
Scollick v. Narula (2017) dcd “13 C.F.R. § 125.13 (a). Furthermore, A service-disabled veteran .”
Metro Tristate, Inc. v. The Public Service Commission of West Virginia and Community Pastor Care, LLC. (2021) wva “In the instant case, Metro similarly points out that VA regulations require a contractor to “obtain and keep current any and all required permits, licenses, and charters, required to operate the business,” 13 C.F.R. § 125.13 (g), and that the VA contract requires CPC to “meet…”
United States v. Ricky Anthony Lanier (2024) ca6 “106 and SDVSOB Program found in 13 CFR § 125.13 , then the required element of intent has been met by the government .”
Hansen v. African Contract Solutions Inc (2020) txnd “The defendants argue that the federal issue is “a substantial issue in the case” because it “is dispositive of the issues,” specifically “whether a temporary restraining order that alters the control requirements of 13 C.F.R. § 125.13 can be entered and whether a state-law…”
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