[Protest of Navy Contract Award Alleging Improper Denial of COC]

A firm protested the award of a contract for sea sheds under a request for proposals issued by the Navy. Although the protester was the low offerer, the contracting officer found it nonresponsible on the basis of a preaward survey. The matter was referred to a regional office of the Small Business Administration (SBA), which recommended issuance of a Certificate of Competency (COC); however, SBA headquarters, which was required to approve the COC, declined to do so. The protester contended that: (1) in not accepting the regional office's recommendation to issue the COC, SBA headquarters acted either fraudulently or in bad faith; (2) Navy officials and SBA headquarters made a deal to deny it the COC; and (3) SBA failed to notify it of financial data missing from its application. GAO will not review SBA decisions regarding the issuance of a COC unless there is a showing of fraud or bad faith on the part of Government officials. GAO found that: (1) the denial of the COC by SBA headquarters, despite the regional office's recommendation that one should be issued, did not show fraud or bad faith on the part of the officials; (2) the fact that Navy officials met with SBA officials was not evidence that a deal had been made to deny the protester the COC; and (3) there is no requirement that SBA provide COC applicants with an opportunity to provide information other than that contained in their initial applications. Accordingly, the protest was dismissed.