“For years, it had been difficult for joint ventures to get Facility Security Clearances to go after DoD contracts where a facility clearance was required. The DoD and many contracting officers had long required that the joint venture entity itself, rather than each individual joint venture member, have the FCL. SBA thought it had fixed this problem when it updated its joint venture rules in November 2020 to eliminate the need for the joint venture to have an FCL, as we wrote at that time. But DoD contracting officers had been ignoring this rule, setting up a showdown at GAO to decide if the SBA’s rule did actually apply to the DoD…”
“GAO rejected the Air Force’s arguments, noting that ‘the plain language of the 2020 NDAA states that DOD “may not” require that a joint venture hold a facility clearance where the members of the joint venture hold the required facility clearances.’ Similarly, SBA’s rules allowing the joint venture to not hold an FCL is SBA ‘is consistent with the 2020 NDAA with regard to the issue raised by the protester–whether DOD may require a joint venture to hold a facility clearance even where the members of the joint venture individually hold the required facility clearances.’ Thus, SBA’s rules constitute an additional reason to grant the protest.
Bottom line, GAO affirmed that a joint venture does not have to hold the facility clearance where its members do hold the required facility clearance. This is a strong affirmation of SBA’s rules and Congressional intent regarding joint ventures. It should make it easier for small businesses joint ventures to go after awards requiring facility clearances, which is a good result for small businesses…” Read the full article here.
Source: GAO Affirms SBA Rule: Only Joint Venture Members, not the JV, Need Facility Clearance – By Shane McCall, September 21, 2021. SmallGovCon.
