Novation or Change-of-Name Agreements?

[Rodolfo]

Good morning,

I would need your valuable advice suggestions regarding this existing scenario.

An American firm formed a JV with an Italian firm in order to participate in a tender for a MATOC in Italy as it would not have had the requisites to participate (for example SOA certifications which in Italy are certifications that qualify a company to participate in public contracts in categories of works and rankings of amount, both commensurate with the skills and experience that the company has shown to the Certification Body). Keep in mind that all the documentation that had to be sent for evaluation by the government was provided by the Italian company. The American firm only provided the bid bond in the form of a bank letter. The contract was outsourced to the JV. After a few months, the American firm expressed its desire to leave the JV for logistical and commercial reasons; the Italian company, on the other hand, would like to continue with the contract and would be able to provide all the guarantees required by the contract. The Italian firm would like to ask the government for a novation so that the contract is entrusted to it and no longer to the JV as it is about to dissolve. However, the Italian company is not able to clearly understand whether it will have to request an Agreement to recognize contractor's change of name or a Recognition of a successor in interest to Government contracts. The latter would not seem to the Italian firm the right way as the JV does not intend to transfer the contract to a third party but simply to continue the performance as a single entity without the American firm; the request for a change name would seem more logical, ie from the name of the JV to the name of the remaining law, namely the Italian one, which among other things already has other contracts in place with the Italian government. I hope I have explained myself well as English is not my mother tongue. Could someone kindly provide us with some suggestions? Thanks in advance.

[C Culham]

4 hours ago, Rodolfo said:

Could someone kindly provide us with some suggestions?

Many details are missing that would dictate what the Government may think is the correct approach to the matter.   Noting this I suggest that you contact the Contracting Officer (CO) of MATOC advise them of the matter and get their view and advice on how to proceed as it will be the CO's opinion and direction that matters.   Engaging your own legal is suggested as well.  

[Acquirer]

I would do a Novation (changing the name), after the JV and both entities sign off that they transferred all performance assets and responsibilities to the Italian firm and attesting that they release all claims to each other and the USG (to avoid issues if they disagree about this later on).  That's assuming you did your standard due diligence (Responsibility Determination, etc.) on the Italian firm.

[ji20874]

Rodolfo,

I think you need an attorney.  We don't know if your joint venture was formed under European Union rules or the rules common for states in the U.S.  

But, for me (I am not an attorney), it seems you need a novation rather than a change-of-name. 

[C Culham]

A great example of why contacting legal counsel and conferring directly with the contracting officer on the matter is the best and should I say the only approach.........