New Regulations for Women Owned Small Businesses
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New Regulations for Women Owned Small Businesses

by | Nov 19, 2021 | Firm News

By Jon M. DeVore

The Women-Owned Small Business (WOSB) program began in December of 2000. Public Law 106-554 established this program to help the federal government meet its goal of awarding at least 5% of all contracting dollars to women-owned small businesses. The U.S. Small Business Administration (SBA) has been slow in setting up and administering the WOSB program and Congress has pressured every administration for the last 20 years to get something implemented. However, the reality is that there are distinct advantages for WOSB in the Federal procurement realm, and the regulations discussed below are, at long last, the final steps for women owned small businesses to be formally certified. Warning—Self certification will no longer be sufficient.

Final Regulations related to Women Owned Small Business Certification.

The Federal Acquisition Regulations (FAR) regulation changes bring the FAR into harmony with a final rule issued last year by the SBA (which was issued to comply with Section 825(a)(1) of the National Defense Authorization Act for the Fiscal Year of 2015). In short, it changes the WOSB and Economically Disadvantaged Women Owned Small Businesses (EDWOSB) programs’ status for businesses from a self-certification standard to one that is certified by the SBA or approved third parties. In theory, rather than needing to provide supporting documentation at any request, the individual businesses can now provide the documentation to prove its status and the contract officers can more efficiently check the certification status which, in return, speeds up the award process and lessens the burden on the government.

On May 11, 2020 the SBA published a final rule implementing a statutory requirement that WOSB and EDWOSB obtain certification from the SBA or other authorized third parties.[1] On October 7, 2021 the Department of Defense, General Services Administration, and National Aeronautics and Space Administration published a proposed rule in the federal register seeking to amend the FAR in order to update its rules to reflect and comply with the SBA’s regulatory changes in its 2020 final rule. The proposed rule is open for public comment for 60 days until December 6, 2021. We always encourage people and businesses to submit comments especially on provisions you consider good or bad. The agencies do read the comments and often modify what they will do based on them.

The basic changes are:

  • Definitions. The definition of EDWOSB and WOSB concerns eligible under the WOSB Program is updated adding language requiring that the concern be certified by the SBA or an approved third-party certifier in accordance with 13 CFR 127.300. (at FAR 2.101 and 52.219-1). The Proposed Rule also removes section 19.1501’s definition of the WOSB Program repository as it no longer is the source for verifying eligibility after the SBA’s rule change.
  • Changes to Filing a Protest. The proposed rule revises FAR 19.308 which governs the process to protest a business’s status as WOSB or EDWOSB. Firstly, the proposal now requires that any protests be submitted through email to the SBA. Secondly, the proposed rule removes the requirement that the SBA consider protests when the successful offeror fails to provide all required documents. Finally, the proposed rule adds additional language that the SBA will consider protests only “when presented with evidence that the concern is not owned by economically disadvantaged women who are United States Citizens.” Previously the FAR language did not require 51% ownership be by women who are US citizens.
  • WOSB and ESWOSB Status. Contract officers now must verify that WOSB and ESWOSB concerns seeking set-aside or sole-source contracts be certified by the SBA or approved third parties rather than its prior self-certification. Similarly, joint ventures seeking such status now require the WOSB or ESWOSB to have obtained certification rather than self-certifying. (FAR 19.1506 adds language requiring contracting officers only award sole-source contracts to certified EDWOSB or WOSB businesses).
  • Set-aside Procedures. The proposed rule adds a provision amending the set-aside procedures in FAR 19.505 and allows offerors to submit an offer while waiting for certification under the WOSB Program. If an apparent successful offeror’s certification is pending, the contract officer shall notify the SBA and request the eligibility determination. If the SBA does not provide a decision within those 15 days, the contract officer may choose between providing the SBA additional time to make the determination or proceed to issue the award to the next highest evaluated offeror. No award may actually be issued to an offeror that is not certified as an EDWSOB or WOSB concern.

The certification and representing oneself as a WOSB in the SAM system are two distinct issues. Be prepared to do both. There is a percentage of small business contacts for which there are WOSB goals and there may be options for sole source contracts as well. Ultimately, Compliance with the regulations is especially important. We sincerely hope that you will find this information useful. If you have any questions, please do not hesitate to contact the firm or other women owned small business advocates or associations.

1 Women-Owned Small Business and Economically Disadvantaged Women-Owned Small Business Certification, Final Rule, 95 Fed. Reg. 27650, (May 11, 2020) available at https://www.federalregister.gov/documents/2020/05/11/2020-09022/women-owned-small-business-and-economically-disadvantaged-women-owned-small-business-certification

2 Federal Acquisition Regulation: Certification of Women-Owned Small Businesses, Proposed Rule, 86 Fed. Reg. 55769 (Oct. 7, 2021), available at https://www.federalregister.gov/documents/2021/10/07/2021-21343/federal-acquisition-regulation-certification-of-women-owned-small-businesses

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