On November 15, 2024, DoD issued a final rule to amend the DFARS to implement Section 865 of the NDAA for FY 2024. The final rule requires DoD contracting officers to “consider relevant past performance of affiliate companies of small business concerns during the evaluation of past performance in response to a competitive solicitation.” On a go-forward basis, offerors will be able to submit past performance information for affiliates, which the government will now consider during the evaluation process. DFARS 215.305 has been revised to align with the November 15 final rule, which can be found here.

On December 19, 2024, the Small Business Administration (SBA) issued a proposed rule designed to “encourage faster payments to small business subcontractors and streamline the reporting process for prime contracts.” The proposed rule addresses provisions included in Section 862 of the NDAA for FY 2024. If implemented, this rule would place additional responsibilities and requirements on prime contractors when they fail to make timely payments to subcontractors, including the following: 

• Notify the contracting officer in writing if the prime contractor does not make payments to subcontractors within 30 days past due;
• Cooperate with contracting officers to correct the issue until payment is made; and
• Enable contracting officers to modify prime contractors’ past performance.

The proposed rule also references additional measures designed to simplify the subcontracting reporting process, including aligning commercial subcontracting plans with the government’s fiscal year and modifying how contractors determine a subcontractor’s size status. Comments on the December 19 proposed rule, which can be found here, must be received on or before February 18, 2025.

On January 3, 2025, DoD, GSA, and NASA issued a final rule found here amending the FAR to “implement regulatory changes made by the [SBA] to order-level size and socioeconomic status rerepresentation requirements.” The final rule, which became effective on January 17, 2025, follows a proposed rule issued on September 29, 2023. According to the final rule, contractors that represented their size and socioeconomic status prior to contract award will, in certain circumstances, need to recertify their size and socioeconomic status when bidding on orders under a multiple-award contract. The final rule emphasizes that set-asides for small businesses under multiple-award contracts are to be awarded to entities that qualify based on size and/or socioeconomic status. Conversely, an entity that no longer qualifies as a small business based on its size and/or socioeconomic status may not be eligible for orders placed under multiple-award contracts. Contracting officers will be required to validate the size and/or socioeconomic status of small businesses prior to issuing orders under multiple-award contracts.

On January 15, 2025, DoD, GSA, and NASA issued a proposed rule found here to implement recommendations set forth in the Office of Federal Procurement Policy’s January 25, 2024 memo titled Increasing Small Business Participation on Multiple Award Contracts. Most notably, the proposed rule would amend the FAR with the goal of “expand[ing] the use of small business set-asides for orders against multiple-award contracts” while revising language related to market research, acquisition planning, and small business specialist coordination.