FAR 19.701—Definitions.
Plain-English Summary
FAR 19.701 provides the core definitions used in the small business subcontracting subpart, and those definitions control how agencies, prime contractors, and subcontractors apply the subcontracting plan requirements. It covers the meanings of Alaska Native Corporation (ANC), Indian tribe, commercial plan, individual subcontracting plan, master subcontracting plan, eSRS, subcontract, total contract dollars, reduced payment, untimely payment, and failure to make a good faith effort to comply with a subcontracting plan. These definitions matter because they determine who qualifies for special socioeconomic treatment, what kind of subcontracting plan is required, how subcontracting performance is reported, and when payment problems or plan noncompliance become significant. In practice, the section sets the baseline for evaluating subcontracting obligations, measuring plan goals, and enforcing reporting and payment requirements. Contractors need these definitions to draft compliant plans and track performance correctly, while contracting officers need them to determine applicability, approve plans, and assess compliance. Because several terms incorporate statutory definitions outside the FAR, users must read this section together with the cited U.S. Code provisions when eligibility or status is in question.
Key Rules
ANC definition is statutory
An Alaska Native Corporation includes Regional, Village, Urban, and Group Corporations organized under Alaska law under the Alaska Native Claims Settlement Act, as well as qualifying ANC subsidiaries, joint ventures, and partnerships. The definition depends on the statutory criteria in 43 U.S.C. 1626(e), so eligibility is not just a matter of corporate form.
Indian tribe definition is broad
An Indian tribe includes federally recognized tribes, bands, groups, pueblos, communities, native villages, and certain Alaska Native entities, plus Indian-owned economic enterprises that meet the cited statutory requirements. The key requirement is federal recognition or statutory qualification under the referenced law.
Commercial plan covers company-wide commercial work
A commercial subcontracting plan applies to the offeror’s fiscal year and covers the entire production of commercial products and performance of commercial services sold by all or part of the company. It is used when subcontracting goals can be set across a commercial business base rather than a single contract.
Individual plan is contract-specific
An individual subcontracting plan applies to one specific contract and covers the entire contract period, including options. Its goals must be based on the offeror’s planned subcontracting for that contract, although certain indirect costs may be prorated to the contract.
Master plan is a reusable framework
A master subcontracting plan contains all required elements of an individual plan except the goals, and it may be incorporated into individual plans if approved. It is a template-like structure that can streamline preparation, but it does not replace the need for contract-specific goals.
eSRS is the reporting system
The Electronic Subcontracting Reporting System is the Governmentwide web-based system used for small business subcontracting program reporting. Reporting obligations under this subpart are generally tied to eSRS submissions, so accurate and timely use of the system is essential.
Subcontract has a broad meaning
A subcontract is any agreement, other than an employer-employee relationship, entered into by a prime contractor or subcontractor for supplies or services needed to perform the contract, modification, or subcontract. This broad definition captures lower-tier arrangements that support contract performance.
Payment terms define compliance risk
Reduced payment means paying less than the subcontract amount due for supplies or services after the Government has paid the prime, and untimely payment means payment more than 90 days past due under the subcontract terms. These terms are important because they identify subcontractor payment problems that can affect subcontracting compliance.
Good faith effort has a strict meaning
Failure to make a good faith effort means willful or intentional nonperformance of subcontracting plan requirements or intentional actions that frustrate the plan. This is more than ordinary poor performance; it focuses on deliberate disregard or obstruction of the plan.
Total contract dollars includes options
Total contract dollars means the final anticipated dollar value of the contract, including all option values. This definition matters when determining whether subcontracting plan thresholds or reporting requirements apply.
Responsibilities
Contracting Officer
Use these definitions to decide whether subcontracting plan requirements apply, determine whether a plan is commercial, individual, or master, and evaluate whether reported subcontracting performance and payment behavior indicate compliance issues. The contracting officer also relies on the definitions when reviewing ANC or Indian tribe status, approving plans, and assessing whether a contractor may have failed to make a good faith effort.
Prime Contractor
Identify the correct type of subcontracting plan, calculate goals using the proper contract value and plan scope, report subcontracting activity through eSRS when required, and ensure subcontractors are paid according to subcontract terms. The prime contractor must also avoid conduct that could be viewed as willful noncompliance or intentional frustration of the subcontracting plan.
Subcontractor
Understand whether its agreement qualifies as a subcontract under this subpart, track payment terms, and document reduced or untimely payments when they occur. Lower-tier subcontractors may also need to support reporting or compliance efforts if they are part of a prime’s subcontracting plan structure.
Agency Small Business Specialist / Procurement Staff
Support the contracting officer in applying the definitions correctly, especially for plan type selection, socioeconomic status questions, and subcontracting reporting oversight. They may also help identify patterns of payment problems or plan noncompliance that require follow-up.
ANC or Indian Tribe Entity
Demonstrate that it meets the statutory and regulatory criteria for ANC or Indian tribe status, including any requirements for subsidiaries, joint ventures, partnerships, or Indian-owned economic enterprises. These entities must be able to substantiate eligibility when seeking treatment under the subcontracting program.
System Users of eSRS
Submit subcontracting reports accurately and on time through the Governmentwide electronic system, using the correct plan type and contract data. Users must ensure the information entered reflects the actual subcontracting activity and payment status.
Practical Implications
These definitions drive whether a contractor must prepare a commercial plan, an individual plan, or may use a master plan, so getting the classification wrong can make the entire subcontracting compliance process defective.
The broad subcontract definition means contractors should not limit their compliance review to first-tier suppliers only; lower-tier arrangements and service/supply agreements tied to performance may also matter.
Payment issues are not just accounting problems: reduced payments and payments more than 90 days late can signal subcontracting compliance risk and may trigger scrutiny of whether the prime is honoring its plan.
The good faith effort standard is intentionally strict and focuses on willful or intentional conduct, so contractors should document subcontracting outreach, goal-setting, reporting, and payment practices to show compliance.
Because ANC and Indian tribe status depends on cited statutes, contractors and contracting officers should verify eligibility carefully rather than relying on labels in a proposal or subcontracting plan.
Official Regulatory Text
As used in this subpart- Alaska Native Corporation (ANC) means any Regional Corporation, Village Corporation, Urban Corporation, or Group Corporation organized under the laws of the State of Alaska in accordance with the Alaska Native Claims Settlement Act, as amended ( 43 U.S.C. 1601 , et seq .) and which is considered a minority and economically disadvantaged concern under the criteria at 43 U.S.C. 1626(e)(1) . This definition also includes ANC direct and indirect subsidiary corporations, joint ventures, and partnerships that meet the requirements of 43 U.S.C. 1626(e)(2) . Commercial plan means a subcontracting plan (including goals) that covers the offeror’s fiscal year and that applies to the entire production of commercial products and performance of commercial services sold by either the entire company or a portion thereof ( e.g., division, plant, or product line). Electronic Subcontracting Reporting System (eSRS) means the Governmentwide, electronic, web-based system for small business subcontracting program reporting. Failure to make a good faith effort to comply with the subcontracting plan means willful or intentional failure to perform in accordance with the requirements of the subcontracting plan, or willful or intentional action to frustrate the plan. Indian tribe means any Indian tribe, band, group, pueblo, or community, including native villages and native groups (including corporations organized by Kenai, Juneau, Sitka, and Kodiak) as defined in the Alaska Native Claims Settlement Act (43 U.S.C.A. 1601 et seq .), that is recognized by the Federal Government as eligible for services from the Bureau of Indian Affairs in accordance with 25 U.S.C. 1452(c) . This definition also includes Indian-owned economic enterprises that meet the requirements of 25 U.S.C. 1452(e) . Individual subcontracting plan means a subcontracting plan that covers the entire contract period (including option periods), applies to a specific contract, and has goals that are based on the offeror’s planned subcontracting in support of the specific contract, except that indirect costs incurred for common or joint purposes may be allocated on a prorated basis to the contract. Master subcontracting plan means a subcontracting plan that contains all the required elements of an individual subcontracting plan, except goals, and may be incorporated into individual subcontracting plans, provided the master subcontracting plan has been approved. Reduced Payment means a payment that is for less than the amount agreed upon in a subcontract in accordance with its terms and conditions, for supplies and services for which the Government has paid the prime contractor. Subcontract means any agreement (other than one involving an employer-employee relationship) entered into by a Government prime contractor or subcontractor calling for supplies and/or services required for performance of the contract, contract modification, or subcontract. Total contract dollars means the final anticipated dollar value, including the dollar value of all options. Untimely Payment means a payment to a subcontractor that is more than 90 days past due under the terms and conditions of a subcontract for supplies and services for which the Government has paid the prime contractor.