TITLE:  Associated Aircraft Manufacturing & Sales, Inc., B-293529, March 22, 2004
BNUMBER:  B-293529
DATE:  March 22, 2004
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Associated Aircraft Manufacturing & Sales, Inc., B-293529, March 22, 2004

   DOCUMENT FOR PUBLIC RELEASE                                                
The decision issued on the date below was subject to a GAO Protective      
Order.  This redacted version has been approved for public release.        

   Decision
    
Matter of:   Associated Aircraft Manufacturing & Sales, Inc.
    
File:            B-293529
    
Date:           March 22, 2004
    
John J. Fausti, Esq., John J. Fausti & Associates, for the protester.
Richard Ferguson, Esq., Defense Logistics Agency, for the agency.
Mary G. Curcio, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
    
Protest that agency improperly awarded contract to an unapproved source is
denied where awardee purchased company identified in solicitation as an
approved source, and agency activity responsible for source approval
sanctioned the award.
DECISION
    

   Associated Aircraft Manufacturing & Sales, Inc. protests the award of a
contract to Signal Technology Corp. under solicitation No.
SP0920-03-R-X723, issued by the Defense Logistics Agency (DLA) for radio
frequency detectors for use by the Department of the Navy. Associated
principally asserts that the award was improper because Signal was not
listed in the solicitation as an approved source.
    

   We deny the protest.
    
The solicitation called for an indefinite quantity of radio frequency
detectors, NSN 5895-00-122-1556, a critical application item.  The
solicitation listed three approved sources--Associated, BAE Systems, Inc.
and ST Innowave--that were eligible for award, and provided for award on a
*best value* basis.  Two offerors--Associated and Signal--responded to the
solicitation.  Signal requested in its proposal that it be assigned the
approved source status of Innowave, because it had purchased Innowave. 
DLA forwarded the request to the Navy*s Engineering Support Activity (ESA)
for approval.  The ESA initially approved the request subject to Signal*s
product receiving first article test (FAT) approval, but subsequently
agreed to waive the FAT requirement.  Thereafter, the agency selected
Signal for award. 
    
Associated maintains that the award was improper because Signal was not
listed in the solicitation as an approved source.  This argument is
without merit.  An agency may award a contract to the successor of an
approved source where the successor purchases all aspects of the approved
source that are required for contract performance.  Magneco Inc.,
B-235338, Sept. 1, 1989, 89-2 CPD P: 207 at 7-8.  DLA explains that,
although Signal itself was not listed as an approved source, in purchasing
Innowave Signal obtained all aspects of the company that were required for
contract performance.  The protester has not shown otherwise.
    
Associated argues that Signal lacked proper approval because, according to
Associated, under the standard solicitation provision at Federal
Acquisition Regulation (FAR) S: 52.209-1, when a contractor acquires an
approved source product of another manufacturer--essentially the situation
here--and the location or ownership of the facility where the product was
manufactured will change, the acquiring company must undergo source
approval testing.
    
The protester*s argument is based on a misreading of FAR S: 52.209-1.  The
plain language of that provision requires only *reevaluation of a
qualification* where the location or ownership of the manufacturing
facility of an approved source changes; it does not require that the
purchasing entity undergo testing or be formally re‑approved, as the
protester suggests.  The FAR does contemplate that firms will request
reevaluation of their approved status for a product where the location or
ownership of the manufacturing facility has changed, and FAR S: 9.207
(a)(3) addresses the situation where a firm fails to do so, providing as
follows: 
    
The contracting officer shall promptly report to the agency activity which
established the qualification requirement any conditions which may merit
removal or omission . . . or affect whether a source should continue to be
otherwise identified as meeting the requirement.  These conditions exist
when--
    . . . .   
(3) A supplier fails to request reevaluation following change of location
or ownership of the plant where the product that met the qualification
requirement was manufactured (see the clause at 52.209‑1,
Qualification Requirements). 
Signal*s request in its proposal that it be given Innowave*s source
approval status appears to have served this purpose.  In response to that
request, DLA reported the change in ownership to the ESA responsible for
source approval, and the ESA agreed that Signal could rely upon Innowave*s
source status.  This is all that was required by the FAR.
    
Associated claims that Signal had to be formally re-approved in order to
be eligible for award, because Innowave has not manufactured the item
since 1988, and Signal itself has not manufactured the item since it
purchased Innowave in 1993.  This argument is untimely.  Innowave was
listed in the solicitation as an approved source.  Thus, if Associated
believed that Innowave should not be considered approved due to its years
of inactivity, it was required to protest on this basis prior to the
closing time for receipt of proposals.  See  4 C.F.R. S: 21.2(a)(1)
(2003).
    
The protest is denied.
    
Anthony H. Gamboa
General Counsel