Are borrowers required to apply SBA’s normal affiliation rules under existing U.S. SBA regulations?
Yes. All Borrowers must apply the affiliation rules set forth in the U.S. SBA’s Interim Final Rule on Affiliation.
That rule can be found here:
Borrowers must certify the following, after applying the affiliate rules::
It is eligible to receive a PPP Loan
Is a small business concern
It meets the applicable SBA employee based or revenue based size standard (or eets the alternative size standard.)
Linked here and pasted below is the text from the official question and answer document published by the Department of the Treasury on April 10, 2020, which you should reference:
Below is the official question from Q5 as of April 10, 2020
5. Question: Are borrowers required to apply SBA’s affiliation rules under 13 C.F.R. 121.301(f)?
Below is the official answer from Q5 as of April 10, 2020
Answer: Yes. Borrowers must apply the affiliation rules set forth in SBA’s Interim Final Rule on Affiliation. A borrower must certify on the Borrower Application Form that the borrower is eligible to receive a PPP loan, and that certification means that the borrower is a small business concern as defined in section 3 of the Small Business Act (15 U.S.C. 632), meets the applicable SBA employee-based or revenue-based size standard, or meets the tests in SBA’s alternative size standard, after applying the affiliation rules, if applicable. SBA’s existing affiliation exclusions apply to the PPP, including, for example the exclusions under 13 CFR 121.103(b)(2).
You just learned about:
Normal Affiliation Rules For more information, check out this related resource:
Funding a Business
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