FAR 37.108—Small business Certificate of Competency.
Plain-English Summary
FAR 37.108 addresses a narrow but important exception to the Small Business Administration’s Certificate of Competency (COC) process in certain service procurements. It applies when the Government needs the highest level of competence obtainable and signals that need in the solicitation by requiring a technical/management proposal, followed by a technical evaluation and source selection. In that situation, the normal small business referral and COC procedures in FAR subpart 19.6 may not apply. The practical effect is that a contracting officer may not be required to refer a small business’s responsibility issue to SBA for a COC determination when the procurement is structured as a highly competitive, technically evaluated service acquisition. This section matters because it affects how responsibility determinations are handled, how small business offerors are evaluated, and when SBA gets the opportunity to review a small business’s capability to perform. It is a limited carve-out, not a general waiver of small business protections, and it should be applied only when the solicitation and acquisition method clearly fit the described circumstances.
Key Rules
Applies to certain service contracts
This section is limited to service contracts where the Government requires the highest competence obtainable. It is not a blanket rule for all service acquisitions or all responsibility determinations involving small businesses.
Technical proposal required
The exception is tied to solicitations that request a technical/management proposal. That solicitation structure indicates the agency is evaluating more than price and is using a competitive technical source selection process.
Source selection must include evaluation
A technical evaluation and source selection must actually occur. The mere presence of a proposal request is not enough; the procurement must use the evaluated proposal process described in the section.
COC procedures may not apply
When the conditions are met, the small business Certificate of Competency procedures in FAR subpart 19.6 may be inapplicable. That means SBA referral for a COC is not necessarily required before the agency proceeds.
Narrow exception, not default
This is an exception to the normal small business responsibility review process. Contracting officers should not assume it applies unless the acquisition clearly fits the stated criteria.
Responsibilities
Contracting Officer
Determine whether the service acquisition falls within this narrow category before relying on the exception. If the solicitation requires a technical/management proposal and uses technical evaluation and source selection for the highest competence obtainable, the contracting officer may proceed without applying the COC procedures in subpart 19.6, but should ensure the record supports that conclusion.
Small Business Offeror
Understand that in these procurements, a responsibility issue may not be referred to SBA for a COC determination. The offeror must therefore compete on the technical and management criteria established in the solicitation and cannot assume SBA review will be available.
SBA
Administer COC procedures under FAR subpart 19.6 in the normal course, but recognize that this section identifies a category of service contracts where those procedures may not apply. SBA’s role is limited when the acquisition properly falls within this exception.
Agency/Source Selection Team
Structure and document the acquisition consistently with the need for the highest competence obtainable if the agency intends to use this exception. The evaluation and source selection approach should clearly show that the procurement is a technical/management competition rather than a routine responsibility review.
Practical Implications
This section can change whether a small business gets an SBA COC review, so the solicitation structure matters a great deal.
A common pitfall is treating any technically complex service procurement as exempt; the exception is tied to a specific solicitation and evaluation approach, not just complexity.
Contracting officers should make sure the file shows why the procurement required the highest competence obtainable and how the technical/management proposal process was used.
Small businesses should watch solicitations for language requiring technical/management proposals and understand that responsibility issues may be resolved through source selection rather than SBA referral.
Because this is a narrow carve-out, agencies should apply it carefully to avoid improperly bypassing the normal COC process.
Official Regulatory Text
In those service contracts for which the Government requires the highest competence obtainable, as evidenced in a solicitation by a request for a technical/management proposal and a resultant technical evaluation and source selection, the small business Certificate of Competency procedures may not apply (see subpart 19.6 ).