Small Business Size Standards; Waiver of the Nonmanufacturer Rule

SMALL BUSINESS ADMINISTRATION

13 CFR Part 121

Small Business Size Standards; Waiver of the Nonmanufacturer Rule

AGENCY: Small Business Administration.

ACTION: Waiver of the Nonmanufacturer Rule for television receiving

sets and compact disc players.

-----------------------------------------------------------------------

SUMMARY: The Small Business Administration (SBA) is establishing a

waiver of the Nonmanufacturer Rule for television receiving sets and

compact disc players. The basis for a waiver for these classes of

products is that there are no small business manufacturers or

processors available to supply them to the Federal Government. The

effect of these waivers is to allow otherwise qualified regular dealers

to supply the products of any domestic manufacturer on a Federal

contract set aside for small businesses or awarded through the SBA 8(a)

Program for television receiving sets or compact disc players.

EFFECTIVE DATE: July 27, 1994. This class waiver applies to all

solicitations dated on or after July 27, 1994.

FOR FURTHER INFORMATION CONTACT:

James Parker, Procurement Analyst, U.S. Small Business Administration,

409 3rd Street, SW., Washington DC, 20416, Tel: (202) 205-6465.

SUPPLEMENTARY INFORMATION: Public Law 100-656, enacted on November 15,

1988, incorporated into the Small Business Act the previously existing

regulation that recipients of Federal contracts set aside for small

businesses or the SBA 8(a) Program must provide the products of a small

business manufacturer or processor, if the recipient is other than the

actual manufacturer or processor. This requirement is commonly referred

to as the Nonmanufacturer Rule. The SBA regulations which implement

this requirement are found at 13 CFR 121.906(b) and 121.1106(b).

Section 8(a)(17)(B)(iv)(II), 15 U.S.C. 637(a)(17)(B)(iv)(II), provides

for waiver of this requirement by SBA for any ``class of products'' for

which there are no small business manufacturers or processors available

to participate in the Federal procurement market. To be considered

available to participate in the Federal procurement market on these

classes of products, a small business manufacturer must have submitted

a proposal for a contract solicitation or received a contract from the

Federal Government within the last 24 months. The SBA defines ``class

of products'' based on two coding systems. The first is the Office of

Management and Budget Standard Industrial Classification Manual, and

the second is the Product and Service Code established by the Federal

Procurement Data System.

The SBA was originally asked to process 15 class waivers of these

Nonmanufacturer Rule, and sources were found for all but these

remaining two classes: (1) Television receiving sets and (2) compact

disc players.

Regarding television receiving sets, the SBA sought small business

sources by contacting the General Services Administration's Federal

Supply Service in Fort Worth, Texas. The SBA also researched its

Procurement Automated Source System (PASS) and the Thomas Register. In

addition, SBA published a notice seeking potential sources in the May

6, 1994, Commerce Business Daily and an intent to grant a class waiver

in the April 22, 1994, Federal Register, 59 FR 19150. After a 15-day

comment period, two comments were received received.

Both comments regarded the existence of a small business

manufacturer of health care televisions. These televisions are wall- or

ceiling-mounted and are normally used in hospitals, nursing homes and

dialysis facilities. Although health care televisions may be purchased

and used by individuals in their homes, these televisions are not

normally used in households for home entertainment. Two marketing firms

for these televisions confirmed that these televisions are not

considered household items and are not marketed to individuals for home

entertainment. After reviewing the marketing information for health

care televisions, it has become apparent that they are in a different

category from household television receiving sets.

Based on the absence of small business manufacturers, SBA is

establishing a class waiver for television receiving sets (SIC code

3651, PSC code 7730) pursuant to Section 8(a)(17)(B)(iv)(ii) of the

Small Business Act, 15 U.S.C. 637(a)(17)(B)(iv)(II). The effect of this

class waiver is to allow otherwise qualified regular dealers to supply

the products of any domestic manufacturer on a Federal contract set

aside for small businesses or awarded through the SBA 8(a) Program for

household television receiving. This waiver will be in effect

indefinitely, but is subject to review by SBA.

Regarding compact disc players, the SBA sought small business

sources by contacting the General Services Administration's Federal

Supply Service in Fort Worth, Texas. The SBA also researched the PASS

and the Thomas Register. In addition, SBA published a notice seeking

potential sources in the May 9, 1994, Commerce Business Daily and an

intent to grant a class waiver in the April 22, 1994, Federal Register,

59 FR 19150. After a 15-day comment period, no comments were received.

Based on the absence of small business manufacturers, SBA is

establishing a class waiver for compact disc players (SIC code 3651,

PSC code 7730) pursuant to the statutory authority cited above. The

effect of this class waiver is to allow otherwise qualified regular

dealers to supply the products of any domestic manufacturer on a

Federal contract set aside for small businesses or awarded through the

SBA 8(a) Program for compact disc players. This waiver will be in

effect indefinitely, but is subject to review by SBA.

Dated: July 19, 1994.

Thomas A. Dumaresq,

Associate Administrator for Government Contracting.

[FR Doc. 94-18066 Filed 7-26-94; 8:45 am]

BILLING CODE 8025-01-M