Big Changes To Small Business '50 Percent Rule'

Law360, New York (April 15, 2013, 1:33 PM EDT) -- The National Defense Authorization Act of 2013 made important changes to the limitation on subcontracting, colloquially known as the “50 percent rule.” The changes may make compliance easier to calculate but harder to achieve. They may also stymie plans by the U.S. Small Business Administration to apply the rule to individual orders under “indefinite-delivery, indefinite-quantity” contracts. Finally, the odd structure of the provision seems to impose two separate tests for compliance.

The Small Business Act has long required that when a federal contract is set aside...
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