Federal Acquisition Regulation 52.219–14: Limitations on Subcontracting
Summary
Federal Acquisition Regulation 52.219–14, Limitations on Subcontracting (OCT 2022), in 48 CFR Ch. 1 (10–1–25 Edition), on a page that also carries 52.219–12 Special 8(a) Subcontract Conditions and 52.219–13 Notice of Set-Aside of Orders (MAR 2020). Under paragraph (e) of the clause the contractor agrees that for services (except construction) it will not pay more than 50 percent of the amount paid by the Government to subcontractors that are not similarly situated entities, and not more than 50 percent for supplies, excluding the cost of materials. For construction by special trade contractors it will not pay more than 75 percent. Paragraph (g) says a small business protégé in an approved joint venture shall perform at least 40 percent of the work performed by the joint venture.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“Federal Acquisition Regulation 52.219–14: Limitations on Subcontracting.”
Original at www.govinfo.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/cfr-2025-title48-vol2-sec52-219-14-2026-09-19-1b981cd263/
, SHA-256 82247307c29fa85a81b9ce355d32de4fa4d2bfe421966b91f56f245cc7322d5b.Full text
Federal Acquisition Regulation 52.219–14
(End of clause) NOTICE OF SET-ASIDE OF ORDERS (MAR 2020)
(a) The Contracting Officer may set aside
[48 FR 42478, Sept. 19, 1983, as amended at 54 orders for the small business concerns identi-
FR 46009, Oct. 31, 1989; 55 FR 3888, Feb. 5, 1990; fied in 19.000(a)(3).
61 FR 67422, Dec. 20, 1996; 82 FR 4731, Jan. 13, (b) The Contracting Officer will give notice
2017] of the order or orders, if any, to be set aside
for small business concerns identified in
52.219–12 Special 8(a) Subcontract 19.000(a)(3) and the applicable small business
Conditions. program. This notice, and its restrictions,
will apply only to the specific orders that
As prescribed in 19.811–3(b), insert the have been set aside for any of the small busi-
following clause: ness concerns identified in 19.000(a)(3).
SPECIAL 8(a) SUBCONTRACT CONDITIONS (OCT (End of clause)
2019)
(a) The Small Business Administration Alternate I (MAR 2020). As prescribed
(SBA) has entered into Contract No. ____ in 19.507(f)(2), substitute the following
[insert number of contract] with the ____ [insert paragraph (a) for paragraph (a) of the
name of contracting agency] to furnish the basic clause:
supplies or services as described therein. A (a) The Contracting Officer will set aside
copy of the contract is attached hereto and orders for the small business concerns identi-
made a part hereof. fied in 19.000(a)(3) when the conditions of
(b) The ____ [insert name of subcontractor], FAR 19.502–2 and the specific program eligi-
hereafter referred to as the subcontractor, bility requirements are met, as applicable.
agrees and acknowledges as follows:
[76 FR 68036, Nov. 2, 2011, as amended at 85
(1) That it will, for and on behalf of the FR 11770, Feb. 27, 2020]
SBA, fulfill and perform all of the require-
ments of Contract No. ___ [insert number of 52.219–14 Limitations on Subcon-
contract] for the consideration stated therein tracting.
and that it has read and is familiar with
each and every part of the contract. As prescribed in 19.507(e), insert the
(2) That the SBA has delegated responsi- following clause:
bility, except for novation agreements, for
LIMITATIONS ON SUBCONTRACTING (OCT 2022)
the administration of this subcontract to the
___ [insert name of contracting agency] with (a) This clause does not apply to the unre-
complete authority to take any action on be- stricted portion of a partial set-aside.
half of the Government und_d conditions of (b) Definition. Similarly situated entity, as
this subcontract. used in this clause, means a first-tier sub-
(3) That it will notify the [insert name of contractor, including an independent con-
contracting agency] Contracting Officer in tractor, that—
writing immediately upon entering an agree- (1) Has the same small business program
ment (either oral or written) to transfer all status as that which qualified the prime con-
tractor for the award (e.g., for a small busi-
or part of its stock or other ownership inter-
ness set-aside contract, any small business
est to any other party.
concern, without regard to its socioeconomic
(c) Payments, including any progress pay- status); and
ments under this subcontract, will be made (2) Is considered small for the size standard
directly to the subcontractor by the ____ under the North American Industry Classi-
[insert name of contracting agency]. fication System (NAICS) code the prime con-
tractor assigned to the subcontract.
(End of clause) (c) Applicability. This clause applies only
to—
[48 FR 42478, Sept. 19, 1983, as amended at 54 (1) Contracts that have been set aside for
FR 34757, Aug. 21, 1989; 54 FR 46009, Oct. 31, any of the small business concerns identified
1989; 55 FR 3889, Feb. 5, 1990; 55 FR 38518, in 19.000(a)(3);
Sept. 18, 1990; 61 FR 67422, Dec. 20, 1996; 82 FR (2) Part or parts of a multiple-award con-
4731, Jan. 13, 2017; 84 FR 47864, Sept. 10, 2019] tract that have been set aside for any of the
small business concerns identified in
52.219–13 Notice of Set-Aside of Or- 19.000(a)(3);
ders. (3) Contracts that have been awarded on a
sole-source basis in accordance with subparts
skersey on DSK4WB1RN3PROD with CFR
As prescribed in 19.507(f)(1), insert the 19.8, 19.13, 19.14, and 19.15;
following clause: (4) Orders expected to exceed the simplified
acquisition threshold and that are—
177
VerDate Sep<11>2014 08:12 May 21, 2026 Jkt 265223 PO 00000 Frm 00187 Fmt 8010 Sfmt 8010 Y:\SGML\265223.XXX 265223
52.219–15 48 CFR Ch. 1 (10–1–25 Edition)
(i) Set aside for small business concerns tract performance, excluding the cost of ma-
under multiple-award contracts, as described terials, to subcontractors that are not simi-
in 8.405–5 and 16.505(b)(2)(i)(F); or larly situated entities. Any work that a
(ii) Issued directly to small business con- similarly situated entity further sub-
cerns under multiple-award contracts as de- contracts will count towards the prime con-
scribed in 19.504(c)(1)(ii); tractor’s 75 percent subcontract amount that
(5) Orders, regardless of dollar value, that cannot be exceeded.
are— (f) The Contractor shall comply with the
(i) Set aside in accordance with subparts limitations on subcontracting as follows:
19.8, 19.13, 19.14, or 19.15 under multiple-
(1) For contracts, in accordance with para-
award contracts, as described in 8.405–5 and
16.505(b)(2)(i)(F); or graphs (c)(1), (2), (3) and (6) of this clause—
(ii) Issued directly to concerns that qualify [Contracting Officer check as appropriate.]
for the programs described in subparts 19.8, ____By the end of the base term of the con-
19.13, 19.14, or 19.15 under multiple-award tract and then by the end of each subsequent
contracts, as described in 19.504(c)(1)(ii); and option period; or
(6) Contracts using the HUBZone price ____By the end of the performance period
evaluation preference to award to a for each order issued under the contract.
HUBZone small business concern unless the (2) For orders, in accordance with para-
concern waived the evaluation preference. graphs (c)(4) and (5) of this clause, by the end
(d) Independent contractors. An independent of the performance period for the order.
contractor shall be considered a subcon- (g) A joint venture agrees that, in the per-
tractor. formance of the contract, the applicable per-
(e) Limitations on subcontracting. By sub- centage specified in paragraph (e) of this
mission of an offer and execution of a con- clause will be performed by the aggregate of
tract, the Contractor agrees that in perform-
the joint venture participants.
ance of a contract assigned a North Amer-
ican Industry Classification System (NAICS) (1) In a joint venture comprised of a small
code for— business protégé and its mentor approved by
(1) Services (except construction), it will the Small Business Administration, the
not pay more than 50 percent of the amount small business protégé shall perform at least
paid by the Government for contract per- 40 percent of the work performed by the joint
formance to subcontractors that are not venture. Work performed by the small busi-
similarly situated entities. Any work that a ness protégé in the joint venture must be
similarly situated entity further sub- more than administrative functions.
contracts will count towards the prime con- (2) In an 8(a) joint venture, the 8(a) partici-
tractor’s 50 percent subcontract amount that pant(s) shall perform at least 40 percent of
cannot be exceeded. When a contract in- the work performed by the joint venture.
cludes both services and supplies, the 50 per- Work performed by the 8(a) participants in
cent limitation shall apply only to the serv- the joint venture must be more than admin-
ice portion of the contract; istrative functions.
(2) Supplies (other than procurement from
a nonmanufacturer of such supplies), it will (End of clause)
not pay more than 50 percent of the amount
paid by the Government for contract per- [86 FR 44245, Aug. 11, 2021, as amended at 87
formance, excluding the cost of materials, to FR 58226, Sept. 23, 2022]
subcontractors that are not similarly situ-
ated entities. Any work that a similarly sit-
uated entity further subcontracts will count
52.219–15 [Reserved]
towards the prime contractor’s 50 percent
subcontract amount that cannot be exceed- 52.219–16 Liquidated Damages—Sub-
ed. When a contract includes both supplies contracting Plan.
and services, the 50 percent limitation shall As prescribed in 19.708(b)(2), insert
apply only to the supply portion of the con- the following clause:
tract;
(3) General construction, it will not pay LIQUIDATED DAMAGES—SUBCONTRACTING
more than 85 percent of the amount paid by PLAN (SEP 2021)
the Government for contract performance,
excluding the cost of materials, to sub- (a) Failure to make a good faith effort to com-
contractors that are not similarly situated ply with the subcontracting plan, as used in
entities. Any work that a similarly situated this clause, means a willful or intentional
entity further subcontracts will count to- failure to perform in accordance with the re-
wards the prime contractor’s 85 percent sub- quirements of the subcontracting plan ap-
contract amount that cannot be exceeded; or proved under the clause in this contract en-
skersey on DSK4WB1RN3PROD with CFR
(4) Construction by special trade contrac- titled ‘‘Small Business Subcontracting
tors, it will not pay more than 75 percent of Plan,’’ or willful or intentional action to
the amount paid by the Government for con- frustrate the plan.
178
VerDate Sep<11>2014 08:12 May 21, 2026 Jkt 265223 PO 00000 Frm 00188 Fmt 8010 Sfmt 8010 Y:\SGML\265223.XXX 265223
File and source
- File
- CFR-2025-title48-vol2-sec52-219-14_2026-09-19.pdf
- Size
- 219,022 bytes
- SHA-256
- 82247307c29fa85a81b9ce355d32de4fa4d2bfe421966b91f56f245cc7322d5b
- Original
- www.govinfo.gov