Is the use of foreign subcontractors allowed?

Subcontractors must also be in the United States. In very rare circumstances, a Government contracting officer (CO) may approve the use of a foreign subcontractor, but it would have to be well documented as to why the foreign subcontractor is the only one capable of meeting a requirement and requires pre-approval in writing from the CO. The SBIR Policy Directive states, “The R/R&D work must be performed in the United States. However, based on a rare and unique circumstance, agencies may approve a particular portion of the R/R&D work to be performed or obtained in a country outside of the United States, for example, if a supply or material or other item or project requirement is not available in the United States. The funding agreement officer must approve each such specific condition in writing.”

An offer would not be declined due to proposing a foreign subcontractor; however, it should be thoroughly explained within the offer as to why a foreign subcontractor is proposed. If the particular offer is chosen for award based on the evaluation, then further details and approval by the CO to utilize the foreign subcontractor will be worked out during the negotiation/award process.