[Protest of DLA Requirements Contract Award]

B-208035: Mar 22, 1983

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A small business concern protested a Defense Logistics Agency (DLA) contract award for medical devices. The protester asserted that it was the low responsible offeror, but was improperly rejected as nonresponsible by DLA without the requisite referral of the matter to the Small Business Administration (SBA) for consideration under the Certificate of Competency (COC) procedures. DLA referred the quality assurance portion of its preaward survey to the Food and Drug Administration (FDA) under an interagency agreement, and FDA could not recommend the protester for the procurement since it was not manufacturing the product at the time of the DLA survey. Based on the FDA recommendation, DLA determined that the protester was nonresponsible and that the determination was exempted from referral to SBA for COC consideration. FDA continued to review the protester's product and found it acceptable after the award for this procurement was made. SBA acknowledged that it could not supplant the FDA finding, but stated that it should have been able to ensure that the small business firm was afforded procedural due process in the evaluation. GAO agreed with the protester and SBA that the responsibility determination should have been referred to SBA as mandated by the Small Business Act. The protester's rejection was based on the DLA contracting officer's nonresponsibility determination which had been derived from a FDA statement that was not binding on the contracting officer. Accordingly, GAO sustained the protest. Since award to the protester under this solicitation was not possible because the contract had been substantially performed, a claim for proposal preparation costs was not considered, and the protester's contentions concerning several minor ancillary issues were also not addressed.