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Panoptic Enterprises' FEDERAL CONTRACTS DISPATCH

DATE: November 16, 2004

SUBJECT: Small Business Administration; Waiver of the Nonmanufacturer Rule for Other Communications Equipment Manufacturing

SOURCE: Federal Register, November 16, 2004, Vol. 69, No. 220, page 67201

AGENCIES: Small Business Administration (SBA)

ACTION: Waiver of the Nonmanufacturer Rule

SUMMARY: The SBA is granting a waiver of the nonmanufacturer rule for other communications equipment manufacturing under North American Industry Classification System (NAICS) code 334290 because no small business manufacturers are currently supplying this class of products to the federal government. This waiver allows otherwise qualified nonmanufacturers to supply the products of any domestic manufacturer on a federal contract set aside for small businesses, service-disabled veteran-owned small businesses, or awarded through the SBA's 8(a) Business Development Program.

EDITOR'S NOTE: For more on the proposed waiver of the nonmanufacturer rule for other communications equipment manufacturing, see the July 28, 2004, FEDERAL CONTRACTS DISPATCH "Small Business Administration; Waiver of the Nonmanufacturer Rule for Other Communications Equipment Manufacturing."

The SBA regulation on the nonmanufacturer rule is in Title 13 of the Code of Federal Regulations (CFR), Business and Credit Administration, Part 121, Small Business Size Standards, under paragraph (b) of 121.406, How Does a Small Business Concern Qualify to Provide Manufactured Products Under Small Business Set-Aside or MED [Minority Enterprise Development] Procurements? The SBA regulation on the waiver of the nonmanufacturer rule is 13 CFR 121.1202, When Will a Waiver of the Nonmanufacturer Rule Be Granted for a Class of Products?

A complete list of products for which the nonmanufacturer rule has been waived is available at http://www.sba.gov/GC/approved.html.

EFFECTIVE DATE: November 30, 2004.

FOR FURTHER INFORMATION CONTACT: Edith Butler, Program Analyst, 202-619-0422; fax: 202-205-7280.

SUPPLEMENTAL INFORMATION: Public Law 100-656, enacted November 15, 1988, requires recipients of federal contracts that are set-aside for small businesses or are awarded through the SBA's 8(a) program for disadvantaged small businesses to provide the product of a small business manufacturer or processor if the recipient is not the actual manufacturer or processor. This is called the "nonmanufacturer rule" (see paragraph (f) of Federal Acquisition Regulation (FAR) 19.102, Size Standards). However, the law permits SBA to waive this requirement for any "class of products" if there are no small business manufacturers or processors in the federal market. SBA considers a small business manufacturer or processor to be in the federal market if it submitted a proposal or received a contract from the federal government within the last 24 months.

SBA published a notice on July 28, 2004, of its intent to grant a waiver for other communications equipment manufacturing under NAICS code 334290 unless information on potential small business sources was provided. Though comments were received in response to this notice, SBA determined that there are no potential small business sources for these items, so SBA is granting the waiver.

FOR FURTHER INFORMATION CONTACT: Panoptic Enterprises at 703-451-5953 or by e-mail to Panoptic@FedGovContracts.com.

Copyright 2004 by Panoptic Enterprises. All Rights Reserved.

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