GAO Dismisses Thales Protest Over Subcontract Procurement Due to Lack of Jurisdiction

The recent GAO decision in Thales LAS France SAS (B-422805) addresses a protest brought by Thales concerning a subcontract procurement conducted by BAE Systems under a U.S. Space Force solicitation. Thales argued that BAE, as the prime contractor, had improperly refused to sign an end-user certificate, preventing Thales from submitting a complete proposal for the subcontract.

In its decision, the GAO dismissed the protest due to a lack of jurisdiction. This outcome hinged on the fact that the procurement was not conducted by a federal agency but by BAE, a private contractor. Under the Competition in Contracting Act (CICA), the GAO only has jurisdiction over protests concerning solicitations and contract awards issued directly by federal agencies. The GAO explained that it does not typically review subcontractor procurements unless it can be shown that the federal agency in question controlled every meaningful aspect of the procurement.

The GAO found that BAE had handled all substantive aspects of the subcontract procurement, including issuing the solicitation, evaluating the proposals, and making the selection decision. Although the U.S. Space Force had issued a task order request for proposals (RFP) to BAE, the federal agency had not played a direct role in selecting the subcontractor. Thales pointed to emails from BAE representatives that seemed to suggest the agency had made the final supplier decision. However, the GAO, after reviewing declarations from BAE employees and a contracting officer, determined that the federal agency's involvement was limited to approving or disapproving BAE's task order proposal, not directing the choice of subcontractors.

This decision is significant because it reaffirms the GAO’s limits on jurisdiction over subcontractor protests. The case clarifies that federal agencies must exert significant control over a subcontract procurement for the GAO to intervene. Merely approving a task order or providing a list of potential subcontractors is insufficient. The ruling thus underscores the autonomy of prime contractors in conducting subcontractor procurements, so long as the federal agency does not assume control of key decisions.