(a) Ownership. Ownership is determined in accordance with 13 CFR part 125. However, where 13 CFR part 125 is limited to SDVOSBs, CVE applies the same ownership criteria to firms seeking verified VOSB status.
(b) Change of ownership. (1) A participant may remain eligible after a change in its ownership or business structure, so long as one or more veterans own and control it after the change. The participant must file an updated VA Form 0877 and supporting documentation identifying the new veteran owners or the new business interest within 30 days of the change.
(2) Any participant that is performing contracts and desires to substitute one veteran owner for another shall submit a proposed novation agreement and supporting documentation in accordance with FAR subpart 42.12 to the contracting officer prior to the substitution or change of ownership for approval.
(3) Where the transfer results from the death or incapacity due to a serious, long-term illness or injury of an eligible principal, prior approval is not required, but the concern must file an updated VA Form 0877 with CVE within 60 days of the change. Existing contracts may be performed to the end of the instant term. However, no options may be exercised.
(4) Continued eligibility of the participant with new ownership requires that CVE verify that all eligibility requirements are met by the concern and the new owners.
[83 FR 48230, Sept. 24, 2018]
Notes of Decisions
Miles Constr., Llc v. United States, 108 Fed. Cl. 792 (Fed. Cl. 2013).
· cites it 14× “Pre-award bid protest; disparate intra-agen-cy decisions regarding the unconditional nature of a service-disabled veteran’s ownership of a small business; evidence of “ownership” within the meaning of 38 C.F.R. § 74.3 ; prejudice; remedy *795 OPINION AND ORDER 1 LETTOW, Judge.”
Ambuild Co., LLC v. United States, 119 Fed. Cl. 10 (Fed. Cl. 2014).
· cites it 11× “” 38 C.F.R. § 74.3 . Section 74.3 elaborates that [ojwnership must not be “subject to conditions precedent, conditions subsequent, ex-ecutory agreements, voting trusts, restrictions on assignments of voting rights, or other arrangements causing or potentially causing ownership…”
Vets. Contracting Grp., Inc. v. United States, 133 Fed. Cl. 613 (Fed. Cl. 2017).
· cites it 6× “Under 38 C.F.R. § 74.3 , “[a]n applicant or participant must be at least 51 percent unconditionally and directly owned by one or more .”
Miles Constr., LLC v. United States, 113 Fed. Cl. 174 (Fed. Cl. 2013).
· cites it 8× “On August 27, 2012, OSDBU rendered its decision, finding that although the grounds of the protest were not valid, Miles was nevertheless ineligible for SDVOSB status because its majority shareholder did not have “unconditional ownership” as required by VA’s regulation found at…”
United States v. Gorski, 880 F.3d 27 (1st Cir. 2018).
· cites it 4× “See 38 C.F.R. § 74.3 (2010); 38 C.F.R. § 74.3 (2008); 13 C.”
Precise Sys., Inc. v. United States, 120 Fed. Cl. 586 (Fed. Cl. 2015).
· cites it 2× “(citing VA regulation, 38 C.F.R. § 74.3 (a) (2013)). Lastly, the OHA acknowledged Precise’s concerns that the AD/GC’s determination is “poor policy” as it would “discourage other, would-be SDVO SBCs from creating ESOPs,” but the OHA observed that it “has no authority to…”
Precise Sys., Inc. v. United States, 122 Fed. Cl. 263 (Fed. Cl. 2015).
· cites it 2× “(citing the VA’s ESOP exception, 38 C.F.R. § 74.3 (a)). The “SBA’s program contains no such exemption, and there is no legal basis for OHA to read in such an exception.”
United States v. Gorski, 807 F.3d 451 (1st Cir. 2015).
“9 ; 38 C.F.R. § 74.3 . The entity must also be controlled by one or more service-disabled veterans, meaning that both long-term decision-making and day-to-day management are conducted by service-disabled veterans.”
BlueStar Energy Servs., Inc. v. United States, 100 Fed. Cl. 607 (Fed. Cl. 2011).
· cites it 2× “” 38 C.F.R. § 74.3 . Moreover, the service-disabled owner must control the “day-to-day management and long-term decisionmaking” of the entity.”
United States v. Gorski, 36 F. Supp. 3d 256 (D. Mass. 2014).
“38 C.F.R. § 74.3 ; 13 C.F.R. § 125.9 . The entity must also be controlled by one or more service-disabled veterans.”
Vets. Contracting Grp., Inc. v. United States (Fed. Cl. 2017).
· cites it 6× “The government asserted that that provision of the Operating Agreement was an executory agreement that violated 38 C.F.R. § 74.3 (b) “because it prevent[ed the] owner from acting [unilaterally] upon his ownership interest.”
— 38 C.F.R. § 74.3(b) — 2 cases
Miles Constr., Llc v. United States, 108 Fed. Cl. 792 (Fed. Cl. 2013).
“Pre-award bid protest; disparate intra-agen-cy decisions regarding the unconditional nature of a service-disabled veteran’s ownership of a small business; evidence of “ownership” within the meaning of 38 C.F.R. § 74.3 ; prejudice; remedy *795 OPINION AND ORDER 1 LETTOW, Judge.”
Ambuild Co., LLC v. United States, 119 Fed. Cl. 10 (Fed. Cl. 2014).
“” 38 C.F.R. § 74.3 . Section 74.3 elaborates that [ojwnership must not be “subject to conditions precedent, conditions subsequent, ex-ecutory agreements, voting trusts, restrictions on assignments of voting rights, or other arrangements causing or potentially causing ownership…”
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