Ostensible Subcontractor Rule
An affiliation rule that treats a prime and its subcontractor as joint venturers when the sub performs the primary work.
The ostensible subcontractor rule is a form of affiliation that applies when a subcontractor performs the primary and vital requirements of a contract, or when the prime is unusually reliant on the subcontractor. In that case the SBA treats the prime and subcontractor as joint venturers — and therefore affiliates — for size purposes, which can disqualify a nominally small prime. The rule prevents large firms from using a small 'front' to capture set-aside work.
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