be presented, in person or in writing, and, if desired, through an appropriate representative. However, where one agency has imposed debarment upon a concern or individual, a second agency may also impose a similar debarment for a concurrent period without according an opportunity for a hearing provided that the second agency furnishes notice of the proposed similar debarment to that party, and accords that party an opportunity to present information in his behalf to explain why the proposed similar debarment should not be imposed in whole or in part.

(c) Scope of debarment. (1) A debarment may include all known affiliates of a concern or individual. (See § 1-1.603 (a)).

(2) Each decision to include a known affiliate within the scope of a proposed debarment is to be made on a case by case basis, after giving due regard to all the relevant facts and circumstances.

(3) The criminal, fraudulent, or seriously improper conduct of an individual may be imputed to the business concern with which he is connected, where such grave impropriety was accomplished within the course of his official duty or was effected by him with the knowledge or approval of that concern. Likewise, where a concern is involved in criminal, fraudulent, or seriously improper conduct, any individual who was involved in the commission of the grave impropriety may be debarred.

§ 1-1.605

Suspension of bidders.

(a) Agencies electing to utilize a suspension procedure shall employ the procedure set forth in this section.

(b) Suspension is a drastic action and, as such, shall not be based upon an unsupported accusation. In assessing whether adequate evidence exists for invoking a suspension, consideration should be given to the amount of credible evidence which is available, to the existence or absence of corroboration as to important allegations, as well as to the inferences which may properly be drawn from the existence or absence of affirmative facts. This assessment should include an examination of basic documents, such as contracts, inspection reports, and correspondence. A suspension may be modified whenever it is determined to be in the interest of the Government to do so.

§ 1-1.605-1 Causes and conditions under which executive agencies may suspend contractors.

(a) An agency may, in the interest of the Government, suspend a firm or individual:

(1) Suspected, upon adequate evidence, of

(i) Commission of fraud or a criminal offense as an incident to obtaining, attempting to obtain, or in the performance of a public contract:

(ii) Violation of the Federal antitrust statutes arising out of the submission of bids and proposals; or

embezzlement,

(iii) Commission of theft, forgery, bribery, falsification or destruction of records, receiving stolen property, or any other offense indicating a lack of business integrity or business honesty, which seriously and directly affects the question of present responsibility as a Government contractor; or

(2) For other cause of such serious and compelling nature, affecting responsibility as a Government contractor, as may be determined by the agency to warrant suspension.

(b) A suspension invoked by an agency for any of the causes set forth in (a) (1) and (2) of this § 1-1.605-1 may be the basis for the imposition of a concurrent suspension by another agency.

§ 1-1.605-2 Period and scope of suspension.

(a) Period of suspension. All suspensions shall be for a temporary period pending the completion of an investigation and such legal proceedings as may ensue. In the event that prosecutive action has not been initiated by the Department of Justice within 12 months from the date of the notice of suspension, the suspension shall be terminated unless an Assistant Attorney General requests continuance of the suspension. If such a request is received the suspension may be continued for an additional six months. Notice of the proposed removal of the suspension shall be given to the Department of Justice 30 days prior to the expiration of the 12-month period. In no event shall a suspension continue beyond 18 months unless prosecutive action has been initiated within that period. Whenever prosecutive action has been initiated, the suspension may continue until the legal proceedings are

completed. Upon removal of a suspension, consideration may be given to debarment in accordance with § 1.604 of this subpart.

(b) Scope of suspension. (1) Suspension may include all known affiliates of a concern (firm) or individual.

(2) A decision to include known affiliates in a proposed suspension is an individual determination and, as such, must be made on a case by case basis.

(3) The criminal, fraudulent, or seri- ously improper conduct of an individual may be imputed to the business firm with which he is connected when the impropriety involved was performed within the course of his official duty, or with knowledge or approval of the business firm.

§ 1-1.605-3 Restrictions during period of suspension.

During a period of suspension of a firm or individual, the following policies and procedures shall be applicable:

(a) Bids and proposals shall not be solicited from suspended contractors. If received, bids and proposals shall not be considered and awards for contracts shall not be made to suspended contractors unless it is determined by the agency to be in the best interest of the Government.

(b) Suspended contractors will be subject to the provisions of § 1-1.603 (f) regarding restrictions on subcontractors. § 1-1.605-4 Notice of suspension.

(a) The firm or individual concerned shall be furnished a written notice of the suspension by the agency within 10 days after the effective date. The notice shall state as follows:

(1) The suspension is based (i) on the information that the firm or individual has committed irregularities of a serious nature in business dealings with the Government or (ii) on irregularities which seriously reflect on the propriety of further dealings of the firm or individual with the Government. (The Sirregularities should be described in general terms without disclosing the Government's evidence);

(2) The suspension is for a temporary period pending the completion of an investigation and such legal proceedings as may ensue;

(3) Bids and proposals will not be solicited from the firm or individual and,

if received, will not be considered for award unless determined by the agency to be in the best interest of the Government. (4) The suspension is effective throughout the agency. All inquiries concerning suspended contractors shall be handled in accordance with agency procedures. Where a matter has been referred to the Department of Justice, the agency shall not give further information to the firm or individual concerning the reasons for suspension beyond that stated in the notice of suspension set forth in this § 1-1.605-4 until the Department of Justice has been advised of the inquiry and acquiesces in any such disclosure.

(a) Establish internal procedures and methods for giving effect to this Subpart 1-1.6.

(b) Notify the General Services Administration (GSA) of the name and address of its central office where debarment information should be sent.

(c) Furnish to GSA a copy of the notice of debarment (at time of issuance) on those debarments made under provisions of §1-1.604 (a), or the Buy American Act, and provide GSA with information as to any removals of such debarments.

(d) Check the list of debarred bidders furnished by GSA, and consider firms or individuals listed thereon for inclusion upon its own list, in accordance with the provisions of this Subpart 1-1.6.

(e) As needed, request from GSA a copy of the notice on any debarment case appearing on the list herein provided to be compiled and distributed by GSA. If desired, direct inquiry concerning any debarment case may be made of the agency which originated the action.

(f) Make its list available to all contracting officers within the agency.

§ 1-1.607 General Services Administration responsibility.

In addition to the agency procedure provided in § 1-1.606, GSA will:

(a) Compile and distribute to the designated central office address of each agency a listing of the administrative debarments and debarments under the Buy American Act made by the agencies, including the basis of action, in order that each executive agency may be in

§ 1-1.701-1

Small business concern (for Government procurement). (a) General. A small business concern for the purpose of Government procurement is a concern, including its affiliates, which is independently owned and operated, is not dominant in the field of operation in which it is bidding on Government contracts, and can further qualify under the criteria set forth in this section. ("Concern" means any business entity organized for profit with a place of business located in the United States, its possessions, and Puerto Rico, including but not limited to, an individual, partnership, corporation, joint venture, association, or cooperative. "Annual receipts" means the annual receipts less returns and allowances of a concern and its affiliates.) For the purpose of a procurement of a product classified into two or more industries with different size standards, the smallest of such size standards shall be used in determining a bidder's size status. If no standard for an industry, field of operation, or activity (e.g., animal specialty; fin fish; anthracite mining; management-logistics support to be performed outside of the several States, Puerto Rico, Virgin Islands, or the District of Columbia) has been set forth in this § 1-1.701-1, a concern bidding on a Government contract is a small business if, including its affiliates, it is independently owned and operated, is not dominant in the field of operation in which it is bidding on Government contracts, and has 500 employees or less.

(b) Construction. Any concern bidding on a contract for construction, alteration, or repair (including painting and decorating) of buildings, bridges, roads, or other real property is classified:

(1) As small if its average annual receipts for its preceding three fiscal years do not exceed $7,500,000 (except that if the concern is located in Alaska, such receipts do not exceed $9,375,000).

(2) As small if it is bidding on a contract for dredging and its average annual receipts for its preceding three fiscal years do not exceed $5,000,000 (except that if the concern is located in Alaska, such receipts do not exceed $6,250,000).

(c) Manufacturing. Any concern bidding on a contract for a product it manufactured is classified:

(1) Food canning and preserving. As small if it is bidding on a contract for food canning and preserving and its number of employees does not exceed 500 persons, exclusive of agricultural labor as defined in the Federal Unemployment Tax Act, 26 U.S.C. 3306(k).

(2) Pneumatic tires. As small if it is bidding on a contract for pneumatic tires within Census Classification Codes 30111 and 30112: Provided, That (i) the value of the pneumatic tires within Census Classification 30111 and 30112 which it manufactured in the United States during the preceding calendar year is more than 50 percent of the value of its total worldwide manufacture, (ii) the value of the pneumatic tires within Census Classification Codes 30111 and 30112 which it manufactured worldwide during the preceding calendar year was less than 5 percent of the value of all such tires manufactured in the United States during said period, and (iii) the value of the principal products which it manufactured or otherwise produced or sold worldwide during the preceding calendar year is less than 10 percent of the total value of such products manufactured or otherwise produced or sold in the United States during said period.

(3) Manufacturing industries listed in §1-1.701-1 (h). As small if it is bidding on a contract for a product classified within an industry set forth in paragraph (h) of this section and its number of employees does not exceed the size standard established for that industry.

(4) Manufacturing industries not listed in § 1-1.701-1 (h). As small if it is bidding on a contract for a product classified within an industry not set forth in paragraph (h) of this section and its number of employees does not exceed 500 persons.

(5) Passenger cars. As small if it is bidding on a contract for passenger cars within Census Classification Code 37171: Provided, That (i) the value of the passenger cars within Census Classification Code 37171 which it manufactured or otherwise produced in the United States during the preceding calendar year is more than 50 percent of the value of its

total worldwide manufacture or production of such passenger cars, (ii) the value of the passenger cars within Census Classification Code 37171, which it manufactured or otherwise produced during the preceding calendar year was less than 5 percent of the total value of all such cars manufactured or produced in the United States during the said period, and (iii) the value of the principal products which it manufactured or otherwise produced or sold during the preceding calendar year is less than 10 percent of the total value of such products manufactured or otherwise produced or sold in the United States during said period.

(d) Small business nonmanufacturer. Any concern which submits a bid or offer in its own name, other than for a construction or service contract, but which proposes to furnish a product not manufactured by itself, is deemed to be a small business concern when:

(1) It is a small business concern within the meaning of § 1-1.701-1(a);

(2) Its number of employees does not exceed 500 persons; and

(3) In the case of Government procurement reserved for or involving the preferential treatment of small business concerns (including equal low bids), such nonmanufacturer shall furnish in the performance of the contract the products of a small business manufacturer or producer which products are manufactured or produced in the United States, its possessions, or Puerto Rico. However, if the goods to be furnished are woolen, worsted, knitwear, duck, and webbing, dealers and converters shall furnish such products which have been manufactured or produced by a small weaver (small knitter for knitwear) and, if finishing is required, by a small finisher. If the procurement is for thread, dealers and converters shall furnish such products which have been finished by a small finisher. (Finishing of thread is defined as all "dyeing, bleaching, glazing, mildew proofing, coating, waxing, and other applications required by the pertinent specification, but excluding mercerizing, spinning, throwing, or twisting operations.") If the procurement is for a refined petroleum product, other than a product classified in Standard Industrial Classification Industries No. 2951, Pav

ing mixtures and blocks, No. 2952, Asphalt felts and coatings, No. 2992, Lubricating oils and greases, or No. 2999, Products of petroleum and coal, not elsewhere classified, paragraph (i) of this section is for application. ("Nonmanufacturer" means any concern which in connection with a specific Government procurement contract, other than a construction or service contract, does not manufacture or produce the products required to be furnished by such procurement. Nonmanufacturer includes a concern which can manufacture or produce the products referred to in the specific procurement but does not do so in connection with that procurement.)

(e) Research, development, and testing. Any concern bidding on a contract for research, development, and/or testing is classified:

(1) As small if it is bidding on a contract for research and/or development which requires delivery of a manufactured product and (i) it qualifies as a small business manufacturer within the meaning of § 1-1.701-1(c) for the industry into which the product is classified, or (ii) it qualifies as a small business nonmanufacturer within the meaning of § 1-1.701-1 (d).

(2) As small if it is bidding on a contract for research and/or development which does not require delivery of a manufactured product or on a contract for testing and its number of employees does not exceed 500 persons.

(f) Services. Any concern bidding on a contract for services is classified: (1) As small if it is bidding on a contract for services not otherwise defined in this § 1-1.701-1 and its average annual sales or receipts for its preceding three fiscal years do not exceed $1,000,000 ($1,250,000 if the concern is located in Alaska).

(2) As small if it is bidding on a contract for engineering services other than marine engineering services and its average annual sales or receipts for the preceding 3 fiscal years do not exceed $5 million ($6,250,000 if the concern is located in Alaska).

(3) As small if it is bidding on a contract for motion picture production or motion picture services and its average