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ment shall be furnished to that concern party, and accords that party an opporor individual in accordance with $ 1- tunity to present information in his be1.604-1. Except as precluded by statute, half to explain why the proposed similar a debarment may be removed or the debarment should not be imposed in period thereof may be reduced by the whole or in part. head of the agency or by his authorized (c) Scope of debarment. (1) A derepresentative, upon the submission of barment may include all known affiliates an application, supported by documen of a concern or individual. (See § 1-1.tary evidence, setting forth appropriate 603(a)). grourids for the granting of relief; such (2) Each decision to include a known as newly discovered material evidence, affiliate within the scope of a proposed reversal of a conviction, bona fide change debarment is to be made on a case by of ownership or management, or the case basis, after giving due regard to all elimination of the causes for which the the relevant facts and circumstances. debarment was imposed.

(3) The criminal, fraudulent, or seri(2) Debarment of a firm or individual ously improper conduct of an individual for failure to comply with the provisions may be imputed to the business concern of the Equal Opportunity clause gener with which he is connected, where such ally shall continue until removed by the grave impropriety was accomplished Director of the Office of Federal Contract within the course of his official duty or Compliance, Department of Labor, or by was effected by him with the knowledge the agency itself with the concurrence of or approval of that concern. Likewise, the Director of the Office of Federal Con. where a concern is involved in criminal, tract Compliance.

fraudulent, or seriously improper con(29 FR 10104, July 24, 1964, as amended at duct, any individual who was involved 37 FR 23337, Nov. 2, 1972)

in the commission of the grave impropri§ 1-1.604–) Procedural requirements ety may be debarred.

relating to the imposition of debar 8 1-1.605 Suspension of bidder
ment.

(a) Agencies electing to utilize a sus(a) Initiation of debarment action. An

pension procedure shall employ the proagency secking to debar a concern or in

cedure set forth in this section. dividual (or any affiliate thereof) for (b) Suspension is a drastic action and, cause shall furnish that party with & as such, shall not be based upon an unwritten notice: (1) stating that debar

supported accusation. In assessing ment is being considered, (2) setting whether adequate evidence exists for inforth the reasons for the proposed de voking a suspension, consideration barment, and (3) indicating that such

should be given to the amount of credible party will be accorded an opportunity evidence which is available, to the exfor a hearing if he so requests within a istence or absence of corroboration as stated period of time.

to important allegations, as well as to (b) Hearings. An opportunity for a the inferences which may properly be hearing conducted in a manner pre drawn from the existence or absence of scribed by agency regulations shall be affirmative facts. This assessment should accorded to any concern or individual include an examination of basic docuwhich the agency proposes to debar. Such ments, such as contracts, Inspection reregulations shall establish procedural ports, and correspondence. A suspension safeguards which satisfy the demands may be modified whenever it is deterof fairness, and which, at a mini mined to be in the interest of the Governmum, shall provide that information in ment to do so. opposition to the proposed action may

§ 1-1.605–) Causcs and conditions an. be presented, in person or in writing, and,

der which executive agencies may if desired, through an appropriate rep

suspend contractors. resentative. However, where one agency has imposed debarment upon a concern

(a) An agency may, in the interest of or individual, a second agency may also

the Government, suspend a firm or inImpose a similar debarment for a con

dividual: current period without according an op. (1) Suspected, upon adequate eviportunity for a hearing provided that dence, ofthe second agency furnishes notice of (1) Commission of fraud or a criminal the proposed similar debarment to that offense as an incident to obtaining, at

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tempting to obtain, or in the perform. continue until the legal proceedings are ance of a public contract:

completed. Upon removal of a suspen(il) Violation of the Federal antitrust sion, consideration may be given to destatutes arising out of the submission barment in accordance with $ 1.604 of of bids and proposals; or

this subpart. (iii) An act in violation of the Or. (b) Scope of suspension. (1) Suspenganized Crime Control Act of 1970, or sion may include all known afiliates of commission of embezzlement, theft, & concern (firm) or individual. forgery, bribery, falsification, or destruc (2) A decision to include known ain) tion of records, receiving stolen property, lates in a proposed suspension is an inor any other offense indicating a lack of dividual determination and, as such, business integrity or business honesty must be made on a case by case basis. which seriously and directly affects the (3) The criminal, fraudulent, or seriquestion of present responsibility as a ously improper conduct of an individual Government contractor; or

may be imputed to the business firm with (2) For other cause of such serious which he is connected when the imand compelling nature, affecting respon propriety involved was performed within sibility as a Government contractor, as the course of his official duty, or with may be determined by the agency to knowledge or approval of the business warrant suspension. However, suspen firm. sions related to matters involving the § 1-1.605–3 Notice of suspension. EEO clause shall be handled in accord

A firm or individual that has been susance with regulations which may be prescribed by the Secretary of Labor.

pended shall be furnished immediately (b) A suspension invoked by an

with a notice of the suspension, by regisagency for any of the causes set forth

tered mail, by the head of the agency or in (a) (1) and (2) of this § 1-1.605-1

his designee. The notice of suspension may be the basis for the imposition of a

shall state that: concurrent suspension by another

(a) The suspension is based on (1) an agency.

outstanding indictment, or (2) adequate 129 FR 10104, July 24, 1964, as amended at

evidence that the firm or individual has 37 FR 23338, Nov. 2, 1972; 39 FR 13777,

committed irregularities of a serious Apr. 17, 1974)

nature in business dealings with the

Government, or (3) adequate evidence of $ 1-1.605–2 Period and scope of se

irregularities which seriously reflect on pension.

the propriety of further dealings of the (a) Period of suspension. All suspen firm or individual with the Government. sions shall be for a temporary period (The notice shall identify the indictment pending the completion of an investiga or describe the nature of the irregulartion and such legal proceedings as may ities, in general terms, without disclosing ensue. In the event that prosecutive the Government's evidence); action has not been initiated by the De (b) The suspension is for a temporary partment of Justice within 12 months

period pending the completion of an from the date of the notice of suspen- investigation and such legal proceedings sion, the suspension shall be terminated as may ensue; unless an Assistant Attorney General

(c) Bids and proposals will not be requests continuance of the suspension,

solicited from the firm or individual and, If such a request is received the suspen if received, will not be considered, and sion may be continued for an additional awards of contracts may not be made six months. Notice of the proposed re

unless it is determined by the head of the moval of the suspension shall be given to

agency or his authorized representhe Department of Justice 30 days prior tative to be in the best interest of to the expiration of the 12-month period.

the Government; In no event shall a suspension continue (d) The firm or individual will not be beyond 18 months unless prosecutive eligible for the award of a subcontract action has been initiated within that and whenever the firm or individual is period. Whenever prosecutive action proposed as a subcontractor, the conhas been initiated, the suspension may tracting officer will decline to approve

subcontracting with that firm or individual in any instance in which consent is required of the Government before the subcontract is made, unless it is determined by the agency to be in the best interest of the Government to grant approval;

(e) The suspension is effective throughout the agency; and

(f) A request for hearing will be considered unless the suspension is based upon an outstanding indictment or upon advice from either the Department of Justice or the Department of Labor that such a hearing would prejudice the substantial interests of the Government, and the hearing will be held within 20 calendar days if the request is granted. (39 FR 13777, Apr. 17, 1974) $ 1-1.605–4 Hearings.

(a) Request for hearing. A hearing may be requested upon receipt of the notice of suspension unless the basis for suspension is an outstanding indictment against the firm or individual.

(b) Coordination with Department of Justice. The formal advice of the Department of Justice concerning the impact of release of evidentiary material on possible civil or criminal action against a firm or individual shall be requested upon receipt of a request for a hearing, except when the basis for suspension is already known to involve possible civil or criminal prosecution against the firm or individual. If such advice is orally given, the Department of Justice shall be requested to promptly confirm the advice in writing. The agency head or his designee shall grant the request and hold a hearing or deny the request, as provided in paragraphs (d) and (e) of this § 1-1.605-4.

(c) Coordination with the Department of Labor. The formal advice of the Associate Solicitor (for General Legal Services) of the Department of Labor shall be sought concerning the possible impact of the release of evidentiary material on Department of Labor proceedings against a firm or individual when a suspension is based upon a contractor's violations of labor standards subject to legal proceedings before administrative law judges of the Department of Labor. The agency head or his designee shall grant the request and hold a hearing

or shall deny the request, as provided in paragraphs (d) and (e) of this § 1-1.6054.

(d) Hearing granted. If a decision is made to grant a hearing, the firm or individual shall be immediately informed and the hearing shall be held not later than 20 calendar days after receipt of the request. The head of the agency or his authorized representative shall promptly decide after the hearing whether to continue or terminate the suspension and shall promptly notify the firm or individual of this decision by registered mail.

(e) Hearing denied. If it is determined, based upon the advice received from the Department of Justice or the Department of Labor, that to hold a hearing would adversely affect possible civil or criminal prosecution or possible Labor proceedings against the firm or individual, this determination will be reduced to writing and made a part of the formal record. Notice shall then be furnished to the firm or individual within 20 calendar days after receipt of the request for a hearing that substantial interests of the Government would be prejudiced if a hearing were held but that any information or argument in opposition to the suspension may be presented in person, in writing, or through representation. Any information or argument submitted will be promptly considered by the head of the agency or his authorized representative and, if such action is deemed warranted, the suspension shall be terminated. The firm or individual shall promptly be notified by registered mail whether the suspension is to be continued or terminated. 139 FR 13777, Apr. 17, 1974) § 1-1.605-5 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 sub- Subpart 1-1.7—Small Business ject to the provisions of § 1-1.603(e) re

Concerns garding restrictions on subcontractors. (39 FR 13777, Apr. 17, 1974)

§ 1-1.700 General. 8 1-1.606 Agency procedure.

(a) This subpart, which implements

programs developed cooperatively with Each agency shall:

the Small Business Administration (a) Establish internal procedures and

(SBA) and the Government agencies methods for giving effect to this Subpart

having procurement responsibility, sets 1-1.6.

forth (1) procurement policy with ref(b) Notify the General Services Ad erence to small business concerns; (2) ministration (GSA) of the name and

policy governing the relationship of proaddress of its central office where de curement agencies with SBA; (3) SBA barment information should be sent.

certificate of competency program; (4) (c) Furnish to GSA a copy of the

small business set-aside procedures; (5) notice of debarment (at time of issu small business subcontracting policies; ance) on those debarments made under and (6) information concerning SBA's provisions of $ 1-1.604(a), or the Buy size standards. American Act, and provide GSA with (b) This subpart applies only in the information as to any removals of such United States. As used in this subpart debarments.

the term United States means the States. (d) Check the list of debarred bid. its territories and possessions, Puerto ders furnished by GSA, and consider Rico, the Trust Territory of the Pacific firms or individuals listed thereon for Islands, and the District of Columbia. inclusion upon its own list, in accordance (29 FR 10104, July 24, 1964, as amended at with the provisions of this Subpart 1-1.6. 35 F.R. 8482, June 2, 1970) (e) As needed, request from GSA a

§ 1-1.701 Definitions. copy of the notice on any debarment case appearing on the list herein provided to The definitions in this section apply be compiled and distributed by GSA. I throughout this Subpart 1-1.7. Those desired, direct inquiry concerning any definitions relating to SBA size standdebarment case may be made of the ards for procurement purposes are based agency which originated the action.

on the governing regulations of SBA on (f) Make Its list available to all con the subject (13 CFR Part 121). tracting oficers within the agency.

§ 1-1.701-1 Small business concern (for 81-1.607 General Servlocs Administra. Government procurement). tion responsibility.

(a) General. A small business concern In addition to the agency procedure

for the purpose of Government procureprovided in § 1-1.606, GSA will:

ment is a concern, including its aifliates, (a) Compile and distribute to the des

which is independently owned and operIgnated central office address of each

ated, is not dominant in the field of

operation in which it is bidding on Govagency a listing of the administrative

ernment contracts, and can further debarments and debarments under the

qualify under the criteria set forth in Buy American Act made by the agencies, this § 1-1.701. “Concem" means any including the basis of action, in order business entity organized for profit with that each executive agency may be in a place of business located in the United formed of actions taken by each other States which makes a significant conagency. In general application, this Ust- tribution to the U.S. economy through ing will be for information purposes only payment of taxes and/or use of Ameriand it is not intended to take the place can products, material, and/or labor, etc. of, or be an addition to, the lists main- . “Concern" includes but is not limited to tained by the various agencies.

an individual, partnership, corporation, (b) Furnish to any agency, on specific joint venture, association, or cooperative. request, a copy of the notice reflecting For the purpose of making affiliation the basis for debarment action taken by findings (see § 1-1.701-2) any business another agency for causes contained in entity, whether organized for profit or § 1-1.604(a) or under the Buy American not, and any foreign entity; i.e., any Act.

entity located outside the United States,

shall be included. “Annual receipts" means the gross income (less returns and allowances, sales of fixed assets, and interaffiliate transactions) of a concern (and its domestic and foreign affiliates) from sales of products and services, in terest, rents, fees, commissions, and/or from whatever other source derived, as entered on its regular books of account for its most recently completed fiscal year (whether on a cash, accrual, completed contracts, percentage of completion, or other acceptable accounting basis) and, in the case of a concern subject to U.S. Federal income taxation, reported or to be reported to the Depart. ment of the Treasury, Internal Revenue Service, for Federal income tax purposes. If a concern has been in business less than a year its annual receipts shall be computed by determining its average weekly receipts for the period in which it has been in business and multiplying such figure by 52. If a concern has acquired an affiliate during the applicable accounting period, it is necessary in computing the concern's annual receipts to include the affiliate's receipts during the accounting period, rather than only its receipts during the period in which it has been an affiliate. The receipts of a former affiliate are not included even if such concern had been an affiliate during a portion of the applicable accounting period.

(1) If a procurement calls for more than one item and the bidder can bid on any or all items, the bidder must meet the size standard for each item on which it submits a bid. If a procurement calls for more than one item and a bidder is required to bid on all or none of such items, the bidder can qualify as a small business for such procurement if it meets the size standard for the item accounting for the greatest percentage of the total contract value. (For size standard purposes, a product or service is classified into only one industry, even though, for other purposes, it could be classified into more than one industry.)

(2) If no standard for an industry, field of operation, or activity (e.g., animal specialty; fin fish; mar.agementlogistics support to be performed outside the United States) 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 operations

in which it is bidding on Government contracts, and has 500 employees or less.

(b) Construction. Any concern bidding on a Government contract for construction, alteration, or repair (including painting and decorating) of buildings, bridges, or other real property, or other work which is classified in Division C, Contract Construction of the Standard Industrial Classification Manual, as amended, prepared and published by the Office of Management and Budget (formerly Bureau of the Budget), Executive Office of the President, is classified:

(1) General. As small if its average annual receipts for its preceding 3 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) Dredging. As small if it is bidding on a contract for dredging and its average annual receipts for its preceding 3 fiscal years do not exceed $5 million (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 Codes 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.

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