On September 24, 2018, the U.S. Department of Veterans Affairs (VA) issued a final rule that alters its regulations governing the Veteran-Owned Small Business Verification Program.  The final rule, “VA Veteran-Owned Small Business (VOSB) Verification Guidelines,” will go into effect on October 1, 2018.  This new rule brings much awaited clarity and uniformity to the regulations governing the VA’s ownership and control requirements for VOSBs and Service-Disabled Veteran-Owned Small Businesses (SDVOSBs).

Details of the VA VOSB Verification Guidelines

The rule places exclusive authority to implement VOSB verification regulations in the Small Business Administration (SBA), and goes so far as to seek the removal of all references to “ownership” or “control” from VA regulations.  Additionally, the rule provides clarification on certain portions of the VA verification process, and outlines the circumstances that will allow a company to qualify as a VOSB or SDVOSB under a surviving spouse or active employee stock ownership plan (ESOP).

Continue Reading VA Concedes Sole Responsibility for Verifying Veteran Contractor Ownership and Control to the SBA

  •  Previously permissible activities must be wound down in 90 or 180 days
  • Non-U.S. companies at particular risk of enforcement action
  • Only limited guidance issued so far, unclear what authority U.S. companies have

On May 8, 2018, President Trump announced that the United States is leaving the Joint Comprehensive Plan of Action (JCPOA).  The U.S. Treasury, Office of Foreign Assets Control (OFAC), which administers most U.S. economic sanctions programs, has taken an initial stab at providing guidance in a set of Frequently Asked Questions (FAQs) released the same day as the President’s announcement.

Continue Reading President Snaps Iran Sanctions Back

In an article published by National Defense Magazine, Bass, Berry & Sims attorneys Richard Arnholt and Sylvia Yi provided insight on the significant changes affecting defense contractors from the National Defense Authorization Act (NDAA) for fiscal year 2018, specifically concerning bid protests.

There are two significant big protest changes in the new NDAA:

  1. the introduction of a new three-year pilot program in which large defense contractors will be required to pay the Department of Defense’s costs where a protest is denied by the Government Accountability Office (GAO); and
  2. the enhancement of post-award debriefing rights.

Continue Reading Richard Arnholt and Sylvia Yi Examine 2018 Changes in Challenges to Bid Protests from NDAA

Two Washington, D.C. area government contractors have agreed to pay the government for their respective roles in defrauding the U.S. Small Business Administration (SBA) in schemes to fraudulently obtain government contracts set aside for small businesses.  These two cases highlight the importance of small business compliance and the submission of accurate and complete certifications. Continue Reading Small Business Fraud Leads to Large Monetary Liability in Recent Cases

Our attorneys will be participating in a panel discussion on unique M&A issues in government contracts. The panel will address key M&A issues, including due diligence, differences in transactions with public and private companies, and solutions to common government contracts issues.

Sylvia Yi will moderate and Todd Overman will be a panelist for this event that will be held at Wiley Rein in Washington, D.C.

EVENT DETAILS:

Continue Reading Event: Due Diligence and Unique M&A Issues in Government Contracts

  • Many medical products can be exported to Iran – so long as a license is obtained
  • Imposition of successor liability underscores importance of pre-transaction due diligence
  • OFAC enforcement, as in the past, continues to take a long time

In December 2017, the U.S. Office of Foreign Assets Control (OFAC) announced a penalty of $1.2 million against DENTSPLY SIRONA Inc. (DSI), one of the world’s largest manufacturers of dental products, for violating U.S. sanctions on Iran.  DSI, which is publicly traded in the United States, is based in York, Pennsylvania, and maintains operations around the world.

Continue Reading U.S. Dental Supply Company Penalized for Violating Iran Sanctions

The Government recently indicted an Army veteran for allegedly using his status as a service-disabled veteran to help a company qualify as a service-disabled veteran-owned small business and falsely obtain nearly $40 million in healthcare facility construction task orders from the Department of Defense.

The indictment is an indication that the government is continuing to aggressively pursue small businesses that fail to comply with set-aside requirements, and is a reminder that businesses benefiting from small business programs must be fully compliant with the complex regulations governing those socio-economic programs. It is also a reminder that the consequences of failing to meet those requirements are real – the Army veteran, Joseph Dial Jr., is facing over a century in prison.

Continue Reading If You Don’t Do the Work, You Might Do Time Instead: Service-Disabled Veteran Faces Jail Time for Failing to Run Day-to-Day Operations

Sylvia Yi | Government Contracting | Mentor ProtegeI will be presenting the session SBA’s All Small Mentor-Protégé Program (One Year In) at the 2017 Annual Government Contracting Seminar in Knoxville, TN. The seminar will discuss the components you need to help ensure successful and compliant contracting in today’s challenging environment.

Session topics include:

  • Overview of the All Small Program
  • Background
  • Application, Approval and Appeals
  • Benefits and Obligations
  • Joint Ventures
  • Lessons Learned

The seminar will be held on Wednesday, November 8, 2017 from 8:00 a.m. to 4:30 p.m. EDT. It is being hosted by PDS Consulting Solutions and Strategic Consulting Solutions. Click here for more information and registration.

More Acquisitions May Be Blocked in the Future

Last month, asserting national security concerns, President Trump blocked a $1.3 billion acquisition of Oregon-based Lattice Semiconductor by a subsidiary of the Canyon Bridge Fund (Canyon Bridge), a private equity fund backed by Chinese investors.  This is one of the few instances to date in which a sale to a non-U.S. buyer of a U.S. company has been blocked under rules administered by the U.S. Committee on Foreign Investment in the United States (CFIUS).  Yet the facts of this matter suggest that more potential acquisitions are likely to be blocked in the future.

Continue Reading CFIUS, POTUS Block Chinese Acquisition of U.S. Semi-conductor Maker

We provided insight on opportunities in government contracting for women-owned small business (WOSB) owners in a September 22, 2017, article in the Nashville Business Journal.

Tennessee is among the 10 fastest-growing states for women-owned companies and currently has approximately 64,000 women-owned businesses. The U.S. Small Business Administration’s (SBA) women-owned small business program aims to provide eligible businesses a better shot at securing government contracting opportunities, and since it began in 2011, the program has been updated to eliminate barriers to entry, such as the removal of contract caps on set-aside awards and the authority to award sole-source contracts. These improvements helped lead the government to meet and exceed its 5% contracting goal to women-owned small businesses for the first time in fiscal year 2015.

Continue Reading Calling All Women-Owned Small Businesses: Self-Certify with Caution