United States Code
USC most recently checked for updates: May 16, 2025
§ 631.
Declaration of policy
(a)
Aid, counsel, assistance, etc., to small business concerns
The essence of the American economic system of private enterprise is free competition. Only through full and free competition can free markets, free entry into business, and opportunities for the expression and growth of personal initiative and individual judgment be assured. The preservation and expansion of such competition is basic not only to the economic well-being but to the security of this Nation. Such security and well-being cannot be realized unless the actual and potential capacity of small business is encouraged and developed. It is the declared policy of the Congress that the Government should aid, counsel, assist, and protect, insofar as is possible, the interests of small-business concerns in order to preserve free competitive enterprise, to insure that a fair proportion of the total purchases and contracts or subcontracts for property and services for the Government (including but not limited to contracts or subcontracts for maintenance, repair, and construction) be placed with small-business enterprises, to insure that a fair proportion of the total sales of Government property be made to such enterprises, and to maintain and strengthen the overall economy of the Nation.
(b)
Assistance to compete in international markets
(1)
It is the declared policy of the Congress that the Federal Government, through the Administrator of the Small Business Administration, acting through the Associate Administrator for International Trade, and in cooperation with the Department of Commerce and other relevant State and Federal agencies, should aid and assist small businesses, as defined under this chapter, to increase their ability to compete in international markets by—
(A)
enhancing their ability to export;
(B)
facilitating technology transfers;
(C)
enhancing their ability to compete effectively and efficiently against imports;
(D)
increasing the access of small businesses to long-term capital for the purchase of new plant and equipment used in the production of goods and services involved in international trade;
(E)
disseminating information concerning State, Federal, and private programs and initiatives to enhance the ability of small businesses to compete in international markets; and
(F)
ensuring that the interests of small businesses are adequately represented in bilateral and multilateral trade negotiations.
(2)
The Congress recognizes that the Department of Commerce is the principal Federal agency for trade development and export promotion and that the Department of Commerce and the Small Business Administration work together to advance joint interests. It is the purpose of this chapter to enhance, not alter, their respective roles.
(c)
Aid for agriculturally related industries; financial assistance
It is the declared policy of the Congress that the Government, through the Small Business Administration, should aid and assist small business concerns which are engaged in the production of food and fiber, ranching, and raising of livestock, aquaculture, and all other farming and agricultural related industries; and the financial assistance programs authorized by this chapter are also to be used to assist such concerns.
(d)
Use of assistance programs to establish, preserve, and strengthen small business concerns
(1)
The assistance programs authorized by sections 636(i) and 636(j) of this title are to be utilized to assist in the establishment, preservation, and strengthening of small business concerns and improve the managerial skills employed in such enterprises, with special attention to small business concerns (1) located in urban or rural areas with high proportions of unemployed or low-income individuals; or (2) owned by low-income individuals; and to mobilize for these objectives private as well as public managerial skills and resources.
(2)
(A)
With respect to the programs authorized by section 636(j) of this title, the Congress finds—
(i)
that ownership and control of productive capital is concentrated in the economy of the United States and certain groups, therefore, own and control little productive capital;
(ii)
that certain groups in the United States own and control little productive capital because they have limited opportunities for small business ownership;
(iii)
that the broadening of small business ownership among groups that presently own and control little productive capital is essential to provide for the well-being of this Nation by promoting their increased participation in the free enterprise system of the United States;
(iv)
that such development of business ownership among groups that presently own and control little productive capital will be greatly facilitated through the creation of a small business ownership development program, which shall provide services, including, but not limited to, financial, management, and technical assistance.1
1
So in original. The period probably should be a semicolon.(v)
that the power to let Federal contracts pursuant to section 637(a) of this title can be an effective procurement assistance tool for development of business ownership among groups that own and control little productive capital; and
(vi)
that the procurement authority under section 637(a) of this title shall be used only as a tool for developing business ownership among groups that own and control little productive capital.
(B)
It is therefore the purpose of the programs authorized by section 636(j) of this title to—
(i)
foster business ownership and development by individuals in groups that own and control little productive capital; and
(ii)
promote the competitive viability of such firms in the marketplace by creating a small business and capital ownership development program to provide such available financial, technical, and management assistance as may be necessary.
(e)
Assistance to victims of floods, etc., and those displaced as result of federally aided construction programs
Further, it is the declared policy of the Congress that the Government should aid and assist victims of floods and other catastrophes, and small-business concerns which are displaced as a result of federally aided construction programs.
(f)
Findings; purpose
(1)
with 2 respect to the Administration’s business development programs the Congress finds—
2
So in original. Probably should be capitalized.(A)
that the opportunity for full participation in our free enterprise system by socially and economically disadvantaged persons is essential if we are to obtain social and economic equality for such persons and improve the functioning of our national economy;
(B)
that many such persons are socially disadvantaged because of their identification as members of certain groups that have suffered the effects of discriminatory practices or similar invidious circumstances over which they have no control;
(C)
that such groups include, but are not limited to, Black Americans, Hispanic Americans, Native Americans, Indian tribes, Asian Pacific Americans, Native Hawaiian Organizations, and other minorities;
(D)
that it is in the national interest to expeditiously ameliorate the conditions of socially and economically disadvantaged groups;
(E)
that such conditions can be improved by providing the maximum practicable opportunity for the development of small business concerns owned by members of socially and economically disadvantaged groups;
(F)
(G)
that such procurements also benefit the United States by encouraging the expansion of suppliers for such procurements, thereby encouraging competition among such suppliers and promoting economy in such procurements.
(2)
It is therefore the purpose of section 637(a) of this title to—
(A)
promote the business development of small business concerns owned and controlled by socially and economically disadvantaged individuals so that such concerns can compete on an equal basis in the American economy;
(B)
promote the competitive viability of such concerns in the marketplace by providing such available contract, financial, technical, and mangement 3 assistance as may be necessary; and
3
So in original. Probably should be “management”.(C)
clarify and expand the program for the procurement by the United States of articles, supplies, services, materials, and construction work from small business concerns owned by socially and economically disadvantaged individuals.
(g)
Assistance to disaster victims under disaster loan program
In administering the disaster loan program authorized by section 636 of this title, to the maximum extent possible, the Administration shall provide assistance and counseling to disaster victims in filing applications, providing information relevant to loan processing, and in loan closing and prompt disbursement of loan proceeds and shall give the disaster program a high priority in allocating funds for administrative expenses.
(h)
Assistance to women owned business
(1)
With respect to the programs and activities authorized by this chapter, the Congress finds that—
(A)
women owned business has become a major contributor to the American economy by providing goods and services, revenues, and jobs;
(B)
over the past two decades there have been substantial gains in the social and economic status of women as they have sought economic equality and independence;
(C)
despite such progress, women, as a group, are subjected to discrimination in entrepreneurial endeavors due to their gender;
(D)
such discrimination takes many overt and subtle forms adversely impacting the ability to raise or secure capital, to acquire managerial talents, and to capture market opportunities;
(E)
it is in the national interest to expeditiously remove discriminatory barriers to the creation and development of small business concerns owned and controlled by women;
(F)
the removal of such barriers is essential to provide a fair opportunity for full participation in the free enterprise system by women and to further increase the economic vitality of the Nation;
(G)
increased numbers of small business concerns owned and controlled by women will directly benefit the United States Government by expanding the potential number of suppliers of goods and services to the Government; and
(H)
programs and activities designed to assist small business concerns owned and controlled by women must be implemented in such a way as to remove such discriminatory barriers while not adversely affecting the rights of socially and economically disadvantaged individuals.
(2)
It is, therefore, the purpose of those programs and activities conducted under the authority of this chapter that assist women entrepreneurs to—
(A)
vigorously promote the legitimate interests of small business concerns owned and controlled by women;
(B)
remove, insofar as possible, the discriminatory barriers that are encountered by women in accessing capital and other factors of production; and
(C)
require that the Government engage in a systematic and sustained effort to identify, define and analyze those discriminatory barriers facing women and that such effort directly involve the participation of women business owners in the public/private sector partnership.
(i)
Prohibition on use of funds for individuals not lawfully within United States
None of the funds made available pursuant to this chapter may be used to provide any direct benefit or assistance to any individual in the United States if the Administrator or the official to which the funds are made available receives notification that the individual is not lawfully within the United States.
(j)
Contract bundling
In complying with the statement of congressional policy expressed in subsection (a), relating to fostering the participation of small business concerns in the contracting opportunities of the Government, each Federal agency, to the maximum extent practicable, shall—
(1)
comply with congressional intent to foster the participation of small business concerns as prime contractors, subcontractors, and suppliers;
(2)
structure its contracting requirements to facilitate competition by and among small business concerns, taking all reasonable steps to eliminate obstacles to their participation; and
(3)
avoid unnecessary and unjustified bundling of contract requirements that precludes small business participation in procurements as prime contractors.
(Pub. L. 85–536, § 2[2], July 18, 1958 , 72 Stat. 384; Pub. L. 87–70, title III, § 305(b), June 30, 1961 , 75 Stat. 167; Pub. L. 87–305, § 6, Sept. 26, 1961 , 75 Stat. 667; Pub. L. 93–386, § 2(a)(1), Aug. 23, 1974 , 88 Stat. 742; Pub. L. 94–305, title I, § 112(a), June 4, 1976 , 90 Stat. 667; Pub. L. 95–507, title II, §§ 201, 203, Oct. 24, 1978 , 92 Stat. 1760, 1763; Pub. L. 96–302, title I, § 118(a), July 2, 1980 , 94 Stat. 840; Pub. L. 99–272, title XVIII, § 18015(a), Apr. 7, 1986 , 100 Stat. 370; Pub. L. 100–418, title VIII, § 8002, Aug. 23, 1988 , 102 Stat. 1553; Pub. L. 100–533, title I, § 101, Oct. 25, 1988 , 102 Stat. 2689; Pub. L. 100–590, title I, § 118, Nov. 3, 1988 , 102 Stat. 2999; Pub. L. 100–656, title II, §§ 204, 207(b), Nov. 15, 1988 , 102 Stat. 3859, 3861; Pub. L. 101–37, § 6(c), June 15, 1989 , 103 Stat. 72; Pub. L. 103–403, title VI, § 609, Oct. 22, 1994 , 108 Stat. 4204; Pub. L. 105–135, title IV, § 411, Dec. 2, 1997 , 111 Stat. 2617; Pub. L. 111–240, title I, § 1203(d), Sept. 27, 2010 , 124 Stat. 2522.)
cite as: 15 USC 631
