Misuse of CTA Agreements Under FAR 9.6 Can Lead to Losing Your Contracts in a Size Protest, False Claims Act and Contract Fraud. Avoid These Mistakes at All Costs.
Federal government contractor teaming arrangement attorneys. We help to avoid costly legal mistakes with contractor teaming agreements under FAR 9.601, joint ventures and the various forms of team arrangements used by federal prime contractors.
Our small business government contract teaming arrangement lawyers help companies to avoid or defend against criminal False Claims Act charges for improper use of CTA agreements. Avoid Dangerous SBA Affiliation landmines associated with improper teaming arrangements that can get your contract taken away in a small business size protest.
Many small businesses attempt to use generic contract teaming agreement templates. However, they may not quite understand the underlying SBA small business affiliation regulations that can cost them a lucrative government contract for failure to comply with the rules. The FAR team arrangement lawyers at Watson & Associates, LLC help clients comply with the rules and minimize the chances of getting adverse results from small business size protests or indicted for False Claims Act and or government contract fraud.
Your Team Agreement is Still Subject to the FAR Limitations on Subcontracting Clause
When you enter into a teaming contract relationship, you must be mindful of the various limitations on subcontracting regulations and your obligation either as a prime or subcontractor. Otherwise, you can find yourself litigating or defending an SBA size protest against the company. As government contractor FAR government contractor teaming attorneys, we help you to align your prime and subcontractor relationships based on the fact that disputes may occur. Our clients are aware that the teaming agreement is not by itself enforceable in court. There are other potential documents needed to protect your rights.
FAR 9.601 Government Contractor CTA Agreement Legal Services
When you are awarded the prime contract, or even during the bidding stages, our government contract joint ventures and contractor teaming agreement lawyers can help you with a vast amount of CTA agreement and small business contracting legal services:
- Minimizing the chance of forfeiting an awarded contract because of an SBA size protest
- Drafting and review of contractor teaming arrangements
- Addressing disputes about government contract
- Complying with federal government subcontractor contract law under FAR 9.601 (GSA general avoids FAR Subpart 9.601)
- Avoiding limitations on subcontracting violations between teaming members
- Legal advice on new SBA affiliation rules 13 CFR 121.103 when to use a contractor teaming agreement
- Some prime and subcontractor teaming arrangements CTA and joint venture agreement disputes
- Small Business Size protest litigation and appeals to SBA Office of Hearings and Appeals (SBA OHA)
Call our Federal CTA Agreement Lawyers for Immediate Help. 1.866.601.5518
What are the Different Types of Teaming Arrangements Under FAR 9.6?
Teaming agreements are contracts between two or more companies in which they agree to jointly pursue a contract and coordinate their efforts in doing so. There are three main types of FAR teaming agreements: 1) Joint venture, 2) Mentor Protege relationships, and 3) Prime/subcontractor relationships.
GSA CTA – Contractor Teaming Arrangement Attorneys
A GSA CTA – GSA Schedule Contractor Team Arrangement (CTA) provides for an arrangement where two or more GSA contractors team or consolidate their resources together to provide a solution to meet a government’s needs. Under Schedule CTAs, contractors complement each other and it allows teams to compete for orders for which they may not qualify independently. GSA encourages the use of GSA CTAs to meet buyer’s requirements.
FAR 9.6, Contractor Team Arrangements, does not apply to GSA CTA teaming. Under GSA Schedule regulations, government contractors can use their individual GSA Schedules to develop a solution for the government.
Also. A GSA CTA does not create a separate legal entity, but allows contractors to meet end-user requirements by combining the supplies and/or services from each team member’s separate Schedule contract in response to a buyer’s Request for Quote.
FAR CTA Contracting Agreements Pros and Cons
Understand Government contractor teaming agreement pros and cons:
Pros of Contractor Teaming Agreements
- When deciding your approach to bidding on a federal contract, your company can reach larger contracts if you utilize a contractor teaming agreement correctly.
- If you have a similarly situated company as your teaming partner, you may be able to get some legal benefit when it comes to the limitations on subcontracting laws.
Cons of ContractTeaming Arrangements
- Your FAR CTA contracting agreement, by itself, may not be an enforceable contract.
- (Differences between teaming contracts and joint ventures) The teaming contract has legal penalties and violations can originate from 13 CFR 121.103 but joint venture regulations stem from 13 CFR 124.513.
13 CFR 121.103 & FAR Subpart 9.6 CTA Agreement Rules
If you are a small business seeking to take advantage of another company’s resources, you must be very familiar with the procurement team arrangement rules under FAR 9.6. The basic issue that prime contractors must be aware of is that they cannot let the teaming partner/subcontractor perform the primary and vital parts of the contract ( See 13 CFR 121.103 ). They also cannot let the subcontractor control the project or be liable for violating SBA affiliations rules.
How Can An Improper FAR Teaming Agreement Impact Your Small Business Size Status Under 13 CFR 121.103?
Under the rules set in 13 CFR 121.103, improper FAR teaming agreements, particularly those that let subcontractors take on primary and vital roles, can lead to a small business size status being lost or challenged. This is because such agreements can be seen as evidence of an affiliation between the prime contractor and their subcontractor, which would then lead to the two companies being treated as one entity when it comes to size status determinations.
In addition, such agreements can also be seen as evidence of excessive subcontracting, which is prohibited under 13 CFR 121.101. As a result, if you have an improper teaming agreement on a contract, your small business size status could be challenged or revoked. This could lead to significant penalties and loss of future opportunities.
Contractor Teaming Arrangement – FAQs
Can I use contractor teaming arrangements to hire an incumbent as my subcontractor? This is considered risky business when you enter into a team agreement. If the incumbent could not have bid on the contract itself, the SBA may find a violation of the Ostensible Subcontractor Rule or some other form of unusual reliance or affiliation.
Can I hire all of the incumbent employees? SBA Office of Hearings and Appeals has long recognized it is a common practice in government services contracts for successor companies to hire employees from the incumbent. However, hiring a large number of employees (en masse hiring of incumbent workforce and management personnel ) is often looked at unfavorably and the SBA could find unusual reliance on the incumbent subcontractor. The courts look at the contractor teaming arrangements and the language in them. See also Size Appeal of Human Learning Systems, LLC, SBA No. SIZ-5785 (2016).)
Do I violate the procurement regulations if I team with a large business? Simply teaming with a large business does not by itself violate the 13 CFR 121.103 and FAR. 9.6 CTA teaming agreement regulations, even if the teaming partner is a large business and is the incumbent, a challenge to your teaming relationship must show more than just the relationship. Courts will use the Dover Staffing analysis primarily to assess the teaming relationship.
If I find a reliable teaming partner? Can I continue to use that company as long as I like? When two companies have a history of teaming and working together for Federal government contracts, that relationship could potentially give rise to a finding of affiliation under 13 CFR 121.103 SBA rules. While acting as a prime, the courts will look to see if the small business depends on a large business for a substantial portion of its income.
Call our teaming agreement lawyers and government subcontracting attorneys for immediate representation. 1.866.602.5518.
Avoid Criminal Liability and OIG DOJ Government Contract Fraud Investigations Resulting from Unlawful Contractor Teaming Agreements or Pass Through Violations
One of the many ways that small businesses expose themselves to civil and criminal liability when using contractor teaming arrangements is to violate SBA affiliation rules and FAR limitations on subcontracting pass-through rules. The DOJ and SBA OIG will initiate investigations for procurement fraud and False Claims Act charges. They will issue a subpoena or civil investigative demand for documents, emails, and bank records.
The OIG or DOJ will investigate the prime contractor and subcontractor relationship and look for unlawful control of the business, whether the prime contractor is performing according to the limitations on subcontracting rule, and more. If your company is under a civil or criminal investigation for use of your contractor teaming arrangement, call our contractor CTA agreement lawyers for immediate legal advice and representation.
Additional Information about FAR 9.6 Teaming Agreements
Find out whether your contracts are enforceable in Court.
Call Our CTA Agreement Attorneys
For help assessing the award of a subcontract with your contractor teaming arrangement for government contracts (CTA agreement legal services. under FAR 9.601) structure, team agreements pros and cons, joint venture agreements, or compliance with federal subcontract agreement or regulations, call Watson’s government small business team arrangement and subcontracting attorneys.
Call 1.866.601.5518. Speak to High Profile Attorney Theodore P. Watson, Esq.