Question 1

Can SDVOSBs form a consortium to bid on contracts?

Accepted Answer

SDVOSBs can form consortia, but they must meet the same regulatory requirements as joint ventures for SDVOSB set-aside purposes. A consortium acting as a prime on an SDVOSB set-aside must have an SDVOSB as the managing entity, meet the limitations on subcontracting rules, and comply with JV agreement requirements. Some contract vehicles explicitly allow or disallow consortium bids — review each solicitation carefully.

Question 2

Can an SDVOSB form a joint venture to pursue set-aside contracts?

Accepted Answer

Yes. SDVOSBs can form joint ventures (JVs) to pursue set-aside contracts. The JV must be controlled by the SDVOSB member — meaning the SDVOSB must be the managing venturer and must perform at least 40% of the work. The SDVOSB must also be responsible for managing the JV on a day-to-day basis. The JV agreement must be in writing and meet SBA regulatory requirements.

Question 3

What is the difference between a teaming agreement and a joint venture?

Accepted Answer

A teaming agreement is a pre-proposal arrangement between a prime and subcontractor(s) for a specific bid, but the prime remains solely responsible for the contract. A joint venture creates a separate legal entity that bids and performs as the prime. JVs are more complex but offer greater flexibility for combining past performance and resources. For SDVOSB set-asides, the prime (or JV managing venturer) must be an SDVOSB — a large business cannot be the prime.

Can SDVOSBs form a consortium to bid on contracts?

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