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‘‘(C) invite the participation of the appro-
priate procurement center representative in all 
acquisition planning processes and provide that 
representative access to all acquisition plans in 
development.’’. 
PART 
II—GOALS 
FOR 
PROCUREMENT 
CON-
TRACTS 
AWARDED 
TO 
SMALL 
BUSINESS 
CONCERNS 
SEC. 1631. GOALS FOR PROCUREMENT CONTRACTS AWARD-
ED TO SMALL BUSINESS CONCERNS. 
(a) IN GENERAL.—Section 15(g) of the Small Busi-
ness Act (15 U.S.C. 644(g)) is amended by striking the 
subsection enumerator and inserting the following: 
‘‘(g) 
GOALS
FOR
PROCUREMENT
CONTRACTS 
AWARDED TO SMALL BUSINESS CONCERNS.—’’. 
(b) GOVERNMENTWIDE GOALS.—Paragraph (1) of 
section 15(g) of such Act (15 U.S.C. 644(g)) is amended 
to read as follows: 
‘‘(1) GOVERNMENTWIDE
GOALS.—The Presi-
dent shall annually establish Governmentwide goals 
for procurement contracts awarded to small business 
concerns, small business concerns owned and con-
trolled 
by 
service-disabled 
veterans, 
qualified 
HUBZone small business concerns, small business 
concerns owned and controlled by socially and eco-
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nomically disadvantaged individuals, and small busi-
ness concerns owned and controlled by women in ac-
cordance with the following: 
‘‘(A) The Governmentwide goal for partici-
pation by small business concerns shall be es-
tablished at not less than 25 percent of the 
total value of all prime contract awards for each 
fiscal year and 40 percent of the total value of 
all subcontract awards for each fiscal year. 
‘‘(B) The Governmentwide goal for partici-
pation by small business concerns owned and 
controlled by service-disabled veterans shall be 
established at not less than 3 percent of the 
total value of all prime contract and at not less 
than 3 percent of the total value of all sub-
contract awards for each fiscal year. 
‘‘(C) The Governmentwide goal for partici-
pation by qualified HUBZone small business 
concerns shall be established at not less than 3 
percent of the total value of all prime contract 
and at not less than 3 percent of the total value 
of all subcontract awards for each fiscal year. 
‘‘(D) The Governmentwide goal for partici-
pation by small business concerns owned and 
controlled by socially and economically dis-
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advantaged individuals shall be established at 
not less than 5 percent of the total value of all 
prime contract and at not less than 5 percent 
of the total value of all subcontract awards for 
each fiscal year. 
‘‘(E) The Governmentwide goal for partici-
pation by small business concerns owned and 
controlled by women shall be established at not 
less than 5 percent of the total value of all 
prime contract and at not less than 5 percent 
of the total value of all subcontract awards for 
each fiscal year.’’. 
(c) AGENCY GOALS.—Paragraph (2) of section 15(g) 
of such Act (15 U.S.C. 644(g)) is amended to read as fol-
lows: 
‘‘(2) AGENCY GOALS.— 
‘‘(A) ESTABLISHMENT.—The head of each 
Federal agency shall annually establish, for the 
agency that individual heads, goals for procure-
ment contracts awarded to small business con-
cerns, small business concerns owned and con-
trolled by service-disabled veterans, qualified 
HUBZone small business concerns, small busi-
ness concerns owned and controlled by socially 
and economically disadvantaged individuals, and 
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small business concerns owned and controlled 
by women. 
‘‘(B) RELATIONSHIP
TO
GOVERNMENT-
WIDE GOALS.— 
‘‘(i) SCOPE.—The goals established by 
the head of a Federal agency under sub-
paragraph (A) shall be in the same format 
as the goals established by the President 
under paragraph (1) and shall address 
both prime contract and subcontract 
awards. 
‘‘(ii) REQUIREMENT
PERTAINING
TO 
AGENCY
GOALS.—With respect to each 
goal for a fiscal year established under 
subparagraph (A) for a category of small 
business concern, the participation percent-
age applicable to such goal may not be less 
than the participation percentage applica-
ble to the Governmentwide goal for such 
fiscal year established under paragraph (1) 
for such category. 
‘‘(C) CONSULTATION REQUIRED.— 
‘‘(i) IN
GENERAL.—.In establishing 
goals under subparagraph (A), the head of 
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each Federal agency shall consult with the 
Administrator. 
‘‘(ii) 
DISAGREEMENTS.—Except 
as 
provided by clause (iii), if the Adminis-
trator and the head of a Federal agency 
fail to agree on a goal established under 
subparagraph (A), the disagreement shall 
be submitted to the Administrator for Fed-
eral Procurement Policy for final deter-
mination. 
‘‘(iii) AGENCY
GOALS
OF
THE
DE-
PARTMENT OF DEFENSE.—In the case of a 
goal proposed by the Secretary of Defense 
that is lower than a goal established dur-
ing the preceding fiscal year for the De-
partment of the Defense and for which the 
Administrator does not agree, the disagree-
ment shall be submitted to the Adminis-
trator for Federal Procurement Policy for 
final determination. 
‘‘(D) PLAN FOR ACHIEVING GOALS.—After 
establishing goals under subparagraph (A) for a 
fiscal year, the head of each Federal agency 
shall develop a plan for achieving such goals, 
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which shall apportion responsibilities among the 
agency’s acquisition executives and officials. 
‘‘(E) EXPANDED PARTICIPATION.—In es-
tablishing goals under subparagraph (A), the 
head of each Federal agency shall make a con-
sistent effort to annually expand participation 
by small business concerns from each industry 
category in procurement contracts of such agen-
cy, including participation by small business 
concerns owned and controlled by service-dis-
abled veterans, qualified HUBZone small busi-
ness concerns, small business concerns owned 
and controlled by socially and economically dis-
advantaged individuals, and small business con-
cerns owned and controlled by women. 
‘‘(F) CONSIDERATION.—The head of each 
Federal agency, in attempting to attain ex-
panded participation under subparagraph (E), 
shall consider— 
‘‘(i) contracts awarded as the result of 
unrestricted competition; and 
‘‘(ii) contracts awarded after competi-
tion restricted to eligible small business 
concerns under this section and under the 
program established under section 8(a). 
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‘‘(G) 
COMMUNICATION
REGARDING 
GOALS.— 
‘‘(i) 
IMPORTANCE
OF
ACHIEVING 
GOALS.—Each procurement employee or 
program manager described in clause (ii) 
shall communicate to the subordinates of 
the procurement employee or program 
manager the importance of achieving goals 
established under subparagraph (A). 
‘‘(ii) PROCUREMENT
EMPLOYEES
OR 
PROGRAM MANAGERS DESCRIBED.—A pro-
curement employee or program manager 
described in this clause is a senior procure-
ment executive, senior program manager, 
or Director of Small and Disadvantaged 
Business Utilization of a Federal agency 
having contracting authority.’’. 
(d) ENFORCEMENT; DETERMINATIONS
OF
THE 
TOTAL VALUE OF CONTRACT AWARDS.—Section 15(g) of 
the Small Business Act (15 U.S.C. 644(g)), as amended 
by this part, is further amended by adding at the end the 
following: 
‘‘(3) ENFORCEMENT.—If the Administrator 
does not issue the report required in subsection 
(h)(2) on or before the date that is 120 days after 
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the end of the prior fiscal year, the Administrator 
may not carry out or establish any pilot program 
until the date on which the Administrator issues the 
report. 
‘‘(4) DETERMINATIONS OF THE TOTAL VALUE 
OF CONTRACT AWARDS.—For purposes of the goals 
established under paragraphs (1) and (2), the total 
value of contract awards for a fiscal year may not 
be determined in a manner that excludes the value 
of a contract based on— 
‘‘(A) where the contract is awarded; 
‘‘(B) where the contract is performed; 
‘‘(C) whether the contract is mandated by 
Federal law to be performed by an entity other 
than a small business concern; 
‘‘(D) whether funding for the contract is 
made available in an appropriations Act, if the 
contract is subject to competitive procedures 
under chapter 33 of title 41, United States 
Code; or 
‘‘(E) whether the contract is subject to the 
Federal Acquisition Regulation.’’. 
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SEC. 1632. REPORTING ON GOALS FOR PROCUREMENT 
CONTRACTS AWARDED TO SMALL BUSINESS 
CONCERNS. 
Subsection (h) of section 15 of the Small Business 
Act (15 U.S.C. 644) is amended to read as follows: 
‘‘(h) REPORTING
ON GOALS
FOR PROCUREMENT 
CONTRACTS
AWARDED
TO
SMALL
BUSINESS
CON-
CERNS.— 
‘‘(1) AGENCY REPORTS.—At the conclusion of 
each fiscal year, the head of each Federal agency 
shall submit to the Administrator a report describ-
ing— 
‘‘(A) the extent of the participation by 
small business concerns, small business con-
cerns owned and controlled by veterans (includ-
ing 
service-disabled 
veterans), 
qualified 
HUBZone small business concerns, small busi-
ness concerns owned and controlled by socially 
and economically disadvantaged individuals, and 
small business concerns owned and controlled 
by women in the procurement contracts of such 
agency during such fiscal year; 
‘‘(B) whether the agency achieved the 
goals established for the agency under sub-
section (g)(2)(A) with respect to such fiscal 
year; and 
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‘‘(C) any justifications for a failure to 
achieve such goals. 
‘‘(2) REPORTS BY ADMINISTRATOR.—Not later 
than 60 days after receiving a report from each Fed-
eral agency under paragraph (1) with respect to a 
fiscal year, the Administrator shall submit to the 
President and Congress, and to make available on a 
public website, a report that includes— 
‘‘(A) a copy of each report submitted to 
the Administrator under paragraph (1); 
‘‘(B) a determination of whether each goal 
established by the President under subsection 
(g)(1) for such fiscal year was achieved; 
‘‘(C) a determination of whether each goal 
established by the head of a Federal agency 
under subsection (g)(2)(A) for such fiscal year 
was achieved; 
‘‘(D) the reasons for any failure to achieve 
a goal established under paragraph (1) or 
(2)(A) of subsection (g) for such fiscal year and 
a description of actions planned by the applica-
ble agency to address such failure, including the 
Administrator’s comments and recommenda-
tions on the proposed remediation plan; 
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‘‘(E) for the Federal Government and each 
Federal agency, an analysis of the number and 
dollar amount of prime contracts awarded dur-
ing such fiscal year to— 
‘‘(i) small business concerns— 
‘‘(I) in the aggregate; 
‘‘(II) through sole source con-
tracts; 
‘‘(III) through competitions re-
stricted to small business concerns; 
and 
‘‘(IV) through unrestricted com-
petition; 
‘‘(ii) small business concerns owned 
and controlled by service-disabled vet-
erans— 
‘‘(I) in the aggregate; 
‘‘(II) through sole source con-
tracts; 
‘‘(III) through competitions re-
stricted to small business concerns; 
‘‘(IV) through competitions re-
stricted to small business concerns 
owned and controlled by service-dis-
abled veterans; and 
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‘‘(V) through unrestricted com-
petition; 
‘‘(iii) qualified HUBZone small busi-
ness concerns— 
‘‘(I) in the aggregate; 
‘‘(II) through sole source con-
tracts; 
‘‘(III) through competitions re-
stricted to small business concerns; 
‘‘(IV) through competitions re-
stricted to qualified HUBZone small 
business concerns; 
‘‘(V) through unrestricted com-
petition where a price evaluation pref-
erence was used; and 
‘‘(VI) through unrestricted com-
petition where a price evaluation pref-
erence was not used; 
‘‘(iv) small business concerns owned 
and controlled by socially and economically 
disadvantaged individuals— 
‘‘(I) in the aggregate; 
‘‘(II) through sole source con-
tracts; 
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‘‘(III) through competitions re-
stricted to small business concerns; 
‘‘(IV) through competitions re-
stricted to small business concerns 
owned and controlled by socially and 
economically disadvantaged individ-
uals; 
‘‘(V) through unrestricted com-
petition; and 
‘‘(VI) by reason of that concern’s 
certification as a small business 
owned and controlled by socially and 
economically disadvantaged individ-
uals; 
‘‘(v) small business concerns owned by 
an Indian tribe other than an Alaska Na-
tive Corporation— 
‘‘(I) in the aggregate; 
‘‘(II) through sole source con-
tracts; 
‘‘(III) through competitions re-
stricted to small business concerns; 
‘‘(IV) through competitions re-
stricted to small business concerns 
owned and controlled by socially and 
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economically disadvantaged individ-
uals; and 
‘‘(V) through unrestricted com-
petition; and 
‘‘(vi) small business concerns owned 
by Native Hawaiian Organization— 
‘‘(I) in the aggregate; 
‘‘(II) through sole source con-
tracts; 
‘‘(III) through competitions re-
stricted to small business concerns; 
‘‘(IV) through competitions re-
stricted to small business concerns 
owned and controlled by socially and 
economically disadvantaged individ-
uals; and 
‘‘(V) through unrestricted com-
petition; and 
‘‘(vii) small business concerns owned 
by an Alaska Native Corporation— 
‘‘(I) in the aggregate; 
‘‘(II) through sole source con-
tracts; 
‘‘(III) through competitions re-
stricted to small business concerns; 
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‘‘(IV) through competitions re-
stricted to small business concerns 
owned and controlled by socially and 
economically disadvantaged individ-
uals; and 
‘‘(V) through unrestricted com-
petition; and 
‘‘(viii) small business concerns owned 
and controlled by women— 
‘‘(I) in the aggregate; 
‘‘(II) through competitions re-
stricted to small business concerns; 
‘‘(III) through competitions re-
stricted using the authority under sec-
tion 8(m)(2); 
‘‘(IV) through competitions re-
stricted using the authority under sec-
tion 8(m)(2) and in which the waiver 
authority under section 8(m)(3) was 
used; and 
‘‘(V) through unrestricted com-
petition; and 
‘‘(F) for the Federal Government and each 
Federal agency, the number, dollar amount, 
and distribution with respect to the North 
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American Industry Classification System of 
subcontracts awarded during such fiscal year to 
small business concerns, small business con-
cerns owned and controlled by service-disabled 
veterans, qualified HUBZone small business 
concerns, small business concerns owned and 
controlled by socially and economically dis-
advantaged individuals, and small business con-
cerns owned and controlled by women.’’. 
SEC. 1633. SENIOR EXECUTIVES. 
(a) TRAINING.—Programs established for the devel-
opment of senior executives under section 3396(a) of title 
5, United States Code, shall include training with respect 
to Federal procurement requirements, including con-
tracting requirements under the Small Business Act (15 
U.S.C. 631 et seq.). 
(b) EVALUATION OF EXECUTIVES.—The head of an 
agency shall ensure that evaluations of members of the 
senior executive service, as defined under section 3396(a) 
of title 5, United States Code, responsible for acquisition, 
other senior officials responsible for acquisition, and other 
members of the senior executive service, as appropriate, 
include consideration of the agency’s success in achieving 
small business contracting goals and percentages. Such 
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evaluations shall, as a minimum, consider the extent to 
which the executive— 
(1) promotes a climate or environment that is 
responsive to small business concerns; 
(2) communicates the importance of achieving 
the agency’s small business contracting goals; and 
(3) encourages small business awareness, out-
reach, and support. 
(c) DEFINITIONS.—In this section the term ‘‘respon-
sible for acquisition’’, with respect to a member of the sen-
ior executive service or other senior official, means such 
a member or official who acquires services or supplies, di-
rects agency organizations to acquire services or supplies, 
oversees acquisition officials, including program managers, 
contracting officers, and other acquisition workforce per-
sonnel responsible for formulating and approving acquisi-
tion strategies and plans. 
PART III—MENTOR-PROTEGE PROGRAM 
SEC. 1641. MENTOR-PROTEGE PROGRAMS. 
The Small Business Act (15 U.S.C. 631 et seq.) is 
amended— 
(1) by redesignating section 45 as section 46; 
and 
(2) by inserting after section 44 the following: 
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‘‘SEC. 45. MENTOR-PROTEGE PROGRAMS. 
‘‘(a) ADMINISTRATION PROGRAM.— 
‘‘(1) AUTHORITY.—The Administrator is au-
thorized to establish a mentor-protege program for 
all small business concerns. 
‘‘(2) MODEL FOR PROGRAM.—The mentor-pro-
tege program established under paragraph (1) shall 
be identical to the mentor-protege program of the 
Administration for small business concerns that par-
ticipate in the program under section 8(a) of this 
Act (as in effect on the date of enactment of the Na-
tional Defense Authorization Act for Fiscal Year 
2013), except that the Administrator may modify 
the program to the extent necessary given the types 
of small business concerns included as proteges. 
‘‘(b) PROGRAMS OF OTHER AGENCIES.— 
‘‘(1) APPROVAL
REQUIRED.—Except as pro-
vided in paragraph (4), a Federal department or 
agency may not carry out a mentor-protege program 
for small business concerns unless— 
‘‘(A) the head of the department or agency 
submits a plan to the Administrator for the 
program; and 
‘‘(B) the Administrator approves such 
plan. 
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‘‘(2) BASIS
FOR
APPROVAL.—The Adminis-
trator shall approve or disapprove a plan submitted 
under paragraph (1) based on whether the program 
proposed— 
‘‘(A) will assist proteges to compete for 
Federal prime contracts and subcontracts; and 
‘‘(B) complies with the regulations issued 
under paragraph (3). 
‘‘(3) REGULATIONS.—Not later than 270 days 
after the date of enactment of the National Defense 
Authorization Act for Fiscal Year 2013, the Admin-
istrator shall issue, subject to notice and comment, 
regulations with respect to mentor-protege pro-
grams, which shall ensure that such programs im-
prove the ability of proteges to compete for Federal 
prime contracts and subcontracts and which shall 
address, at a minimum, the following: 
‘‘(A) Eligibility criteria for program par-
ticipants, including any restrictions on the num-
ber of mentor-protege relationships permitted 
for each participant. 
‘‘(B) The types of developmental assistance 
to be provided by mentors, including how the 
assistance provided shall improve the competi-
tive viability of the proteges. 
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‘‘(C) Whether any developmental assist-
ance provided by a mentor may affect the sta-
tus of a program participant as a small busi-
ness concern due to affiliation. 
‘‘(D) The length of mentor-protege rela-
tionships. 
‘‘(E) The effect of mentor-protege relation-
ships on contracting. 
‘‘(F) Benefits that may accrue to a mentor 
as a result of program participation. 
‘‘(G) Reporting requirements during pro-
gram participation. 
‘‘(H) Postparticipation reporting require-
ments. 
‘‘(I) The need for a mentor-protege pair, if 
accepted to participate as a pair in a mentor- 
protege program of any Federal department or 
agency, to be accepted to participate as a pair 
in all Federal mentor-protege programs. 
‘‘(J) Actions to be taken to ensure benefits 
for proteges and to protect proteges against ac-
tions by the mentor that— 
‘‘(i) may adversely affect the proteges 
status as a small business; or 
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‘‘(ii) provide disproportionate eco-
nomic benefits to the mentor relative to 
those provided the protege. 
‘‘(4) LIMITATION
ON
APPLICABILITY.—Para-
graph (1) does not apply to the following: 
‘‘(A) Any mentor-protege program of the 
Department of Defense. 
‘‘(B) Any mentoring assistance provided 
under a Small Business Innovation Research 
Program or a Small Business Technology 
Transfer Program. 
‘‘(C) Until the date that is 1 year after the 
date on which the Administrator issues regula-
tions under paragraph (3), any Federal depart-
ment or agency operating a mentor-protege pro-
gram in effect on the date of enactment of the 
National Defense Authorization Act for Fiscal 
Year 2013. 
‘‘(c) REPORTING.— 
‘‘(1) IN
GENERAL.—Not later than 2 years 
after the date of enactment of the National Defense 
Authorization Act for Fiscal Year 2013, and annu-
ally thereafter, the Administrator shall submit to the 
Committee on Small Business of the House of Rep-
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resentatives and the Committee on Small Business 
and Entrepreneurship of the Senate a report that— 
‘‘(A) identifies each Federal mentor-pro-
tege program; 
‘‘(B) specifies the number of participants 
in each such program, including the number of 
participants that are— 
‘‘(i) small business concerns; 
‘‘(ii) small business concerns owned 
and controlled by service-disabled veterans; 
‘‘(iii) qualified HUBZone small busi-
ness concerns; 
‘‘(iv) small business concerns owned 
and controlled by socially and economically 
disadvantaged individuals; or 
‘‘(v) small business concerns owned 
and controlled by women; 
‘‘(C) describes the type of assistance pro-
vided to proteges under each such program; 
‘‘(D) describes the benefits provided to 
mentors under each such program; and 
‘‘(E) describes the progress of proteges 
under each such program with respect to com-
peting for Federal prime contracts and sub-
contracts. 
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‘‘(2) PROVISION OF INFORMATION.—The head 
of each Federal department or agency carrying out 
a mentor-protege program shall provide to the Ad-
ministrator, on an annual basis, the information nec-
essary for the Administrator to submit a report re-
quired under paragraph (1). 
‘‘(d) DEFINITIONS.—In this section, the following 
definitions apply: 
‘‘(1) MENTOR.—The term ‘mentor’ means a 
for-profit business concern, of any size, that— 
‘‘(A) has the ability to assist and commits 
to assisting a protege to compete for Federal 
prime contracts and subcontracts; and 
‘‘(B) satisfies any other requirements im-
posed by the Administrator. 
‘‘(2) MENTOR-PROTEGE PROGRAM.—The term 
‘mentor-protege program’ means a program that 
pairs a mentor with a protege for the purpose of as-
sisting the protege to compete for Federal prime 
contracts and subcontracts. 
‘‘(3) PROTEGE.—The term ‘protege’ means a 
small business concern that— 
‘‘(A) is eligible to enter into Federal prime 
contracts and subcontracts; and 
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‘‘(B) satisfies any other requirements im-
posed by the Administrator. 
‘‘(e) CURRENT MENTOR PROTEGE AGREEMENTS.— 
Mentors and proteges with approved agreement in a pro-
gram operating pursuant to subsection (b)(4)(C) shall be 
permitted to continue their relationship according to the 
terms specified in their agreement until the expiration 
date specified in the agreement. 
‘‘(f) SUBMISSION OF AGENCY PLANS.—Agencies op-
erating mentor protege programs pursuant to subsection 
(b)(4)(C) must submit the plans specified in subsection 
(b)(1)(A) to the Administrator within 6 months of the pro-
mulgation of rules required by subsection (b)(3). The Ad-
ministrator shall provide initial comments on each plan 
within 60 days of receipt, and final approval or denial of 
each plan with 180 days of receipt.’’. 
SEC. 1642. GOVERNMENT ACCOUNTABILITY OFFICE RE-
PORT. 
Not later than the date that is 2 years after the agen-
cies operating subject to section 45(b)(4)(C) of the Small 
Business Act have their plans approved or denied by the 
Administrator, the Comptroller General of the United 
States shall conduct a study to— 
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(1) update the study required by section 1345 
of the Small Business Jobs Act of 2010 (Pub. Law 
111–240); 
(2) examine whether potential affiliation issues 
between mentors and proteges under the prior pro-
grams have been resolved by enactment of this Act; 
and 
(3) examine whether the regulations issued pur-
suant to section 45(b)(3)(I) of the Small Business 
Act have increased opportunities for mentor-protege 
pairs, and if they have decreased the paperwork re-
quired for such pairs participating in programs at 
multiple agencies. 
PART IV—TRANSPARENCY IN SUBCONTRACTING 
Subpart A—Limitations on Subcontracting 
SEC. 1651. LIMITATIONS ON SUBCONTRACTING. 
The Small Business Act (15 U.S.C. 631 et seq.) is 
amended— 
(1) by redesignating section 45 as section 47; 
and 
(2) by inserting after section 44 the following: 
‘‘SEC. 45. LIMITATIONS ON SUBCONTRACTING. 
‘‘(a) IN GENERAL.—If awarded a contract under sec-
tion 8(a), 8(m), 15(a), 31, or 36, a covered small business 
concern— 
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‘‘(1) in the case of a contract for services, may 
not expend on subcontractors more than 50 percent 
of the amount paid to the concern under the con-
tract; 
‘‘(2) in the case of a contract for supplies 
(other than from a regular dealer in such supplies), 
may not expend on subcontractors more than 50 
percent of the amount, less the cost of materials, 
paid to the concern under the contract; 
‘‘(3) in the case of a contract described in more 
than 1 of paragraphs (1) through (2)— 
‘‘(A) shall determine for which category of 
services or supplies, described in 1 of para-
graphs (1) through (4), the greatest percentage 
of the contract amount is awarded; 
‘‘(B) shall determine the amount awarded 
under the contract for that category of services 
or supplies; and 
‘‘(C) may not expend on subcontractors, 
with respect to the amount determined under 
subparagraph (B), more than— 
‘‘(i) 50 percent of that amount, if the 
category of services or supplies applicable 
under subparagraph (A) is described in 
paragraph (1); and 
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‘‘(ii) 50 percent of that amount, if the 
category of services or supplies applicable 
under subparagraph (A) is described in 
paragraph (2); and 
‘‘(4) in the case of a contract for supplies from 
a regular dealer in such supplies, shall supply the 
product of a domestic small business manufacturer 
or processor, unless a waiver of such requirement is 
granted— 
‘‘(A) by the Administrator, after reviewing 
a determination by the applicable contracting 
officer that no small business manufacturer or 
processor can reasonably be expected to offer a 
product meeting the specifications (including 
period for performance) required by the con-
tract; or 
‘‘(B) by the Administrator for a product 
(or class of products), after determining that no 
small business manufacturer or processor is 
available to participate in the Federal procure-
ment market. 
‘‘(b) SIMILARLY
SITUATED
ENTITIES.—Contract 
amounts expended by a covered small business concern on 
a subcontractor that is a similarly situated entity shall not 
be considered subcontracted for purposes of determining 
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whether the covered small business concern has violated 
a requirement established under subsection (a) or (d). 
‘‘(c) MODIFICATIONS OF PERCENTAGES.— 
‘‘(1) IN
GENERAL.—The Administrator may 
change, by rule (after providing notice and an oppor-
tunity for public comment), a percentage specified in 
paragraphs (1) through (4) of subsection (a) if the 
Administrator determines that such change is nec-
essary to reflect conventional industry practices 
among business concerns that are below the numer-
ical size standard for businesses in that industry 
category. 
‘‘(2) UNIFORMITY.—A change to a percentage 
under paragraph (1) shall apply to all covered small 
business concerns. 
‘‘(d) OTHER CONTRACTS.— 
‘‘(1) IN GENERAL.—With respect to a category 
of contracts to which a requirement under sub-
section (a) does not apply, the Administrator is au-
thorized to establish, by rule (after providing notice 
and an opportunity for public comment), a require-
ment that a covered small business concern may not 
expend on subcontractors more than a specified per-
centage of the amount paid to the concern under a 
contract in that category. 
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‘‘(2) UNIFORMITY.—A requirement established 
under paragraph (1) shall apply to all covered small 
business concerns. 
‘‘(3) CONSTRUCTION PROJECTS.—The Adminis-
trator shall establish, through public rulemaking, re-
quirements similar to those specified in paragraph 
(1) to be applicable to contracts for general and spe-
cialty construction and to contracts for any other in-
dustry category not otherwise subject to the require-
ments of such paragraph. The percentage applicable 
to any such requirement shall be determined in ac-
cordance with paragraph (2). 
‘‘(e) DEFINITIONS.—In this section, the following 
definitions apply: 
‘‘(1) COVERED SMALL BUSINESS CONCERN.— 
The term ‘covered small business concern’ means a 
business concern that— 
‘‘(A) with respect to a contract awarded 
under section 8(a), is a small business concern 
eligible to receive contracts under that section; 
‘‘(B) with respect to a contract awarded 
under section 8(m)— 
‘‘(i) is a small business concern owned 
and controlled by women (as defined in 
that section); or 
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