An August 2016 bid protest decision highlights the importance of government contractors having, and being able to demonstrate, an effective export controls compliance program.
As described in the U.S. Government Accountability Office’s (GAO) decision in Microwave Monolithics, Inc., B-413088 (Aug. 11, 2016), the Army eliminated Microwave Monolithics’ (MM) proposal from competition due to MM’s failure to meet the solicitation’s requirements pertaining to compliance with the International Traffic in Arms Regulations (ITAR).
The solicitation at issue required that offerors and their subcontractors demonstrate ITAR compliance, or have a viable plan to become ITAR compliant prior to contract award. Specifically, the solicitation required that the contractor show that it had appointed an employee to be responsible for ITAR compliance and had established written policies and procedures for employees performing activities subject to ITAR.
Offerors’ proposals also had to show that the contractor had established procedures for the receipt, handling, storing, implementation, and testing of ITAR-controlled items and data, procedures for the restriction of access by foreign nationals to ITAR-controlled items or data, an auditing procedure for ITAR compliance, and procedures for actions to be taken if violations were discovered.
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Download the GAO decision here: http://www.gao.gov/assets/680/679029.pdf
As more U.S. small businesses participate in the global marketplace, they are facing new questions and challenges. Lack of knowledge about government programs available to support overseas investment, limited access to private sector-capital to pursue opportunities abroad, or concern over political risks in emerging markets can prevent small business from expanding overseas.