Data sourced from SAM.gov, USAspending, FPDS, Grants.gov. 110+ supplementary federal data feeds. View methodology →
100M+ government records · 110+ gov/news sources · Synced from live federal sources
Explore 100M+ federal records across SAM.gov, Grants.gov, USAspending, FPDS, and 110+ federal sources.
Search all opportunities →Most government contracts are won by teams, not solo companies. This guide explains how to structure teaming relationships, what clauses to include in your agreements, and how to decide when teaming makes strategic sense.
100M+ government records · 110+ gov/news sources · Synced from live federal sources
A teaming agreement (TA) is a pre-award arrangement between two or more companies to collaborate on a specific government contract pursuit. The agreement typically establishes one company as the prospective prime contractor and the others as prospective subcontractors, though the actual subcontract is negotiated separately if the team wins the contract.
Teaming is extremely common in government contracting. Few companies possess every capability, certification, past performance record, and geographic presence required by complex federal solicitations. By teaming, companies combine complementary strengths to present a more competitive proposal than either could submit alone.
The teaming agreement governs the pre-award relationship: how the team will pursue the opportunity, who contributes what to the proposal, how costs are shared during the proposal phase, and the general terms of the anticipated subcontract. It is distinct from — and typically precedes — the formal subcontract that governs post-award performance.
Teaming agreements are referenced in FAR 9.6, which describes contractor team arrangements and notes that the government generally recognizes the integrity and validity of contractor team arrangements. However, the FAR does not prescribe specific requirements for teaming agreements — the terms are negotiated between the parties.
There are two primary structures for teaming on government contracts: prime- subcontractor arrangements and joint ventures. Each has distinct legal, operational, and strategic implications.
In this structure, the prime contractor submits the proposal, holds the contract with the government, and bears primary responsibility for performance. The prime issues a subcontract to the teammate(s) for defined portions of the work. The government's contractual relationship is solely with the prime — subcontractors have no privity of contract with the government.
Advantages: simpler to structure, no new entity creation, clear roles and responsibilities, the prime controls the customer relationship. Disadvantages: the subcontractor has limited visibility and control, the prime takes most of the risk and reward, and the subcontractor's past performance accrues primarily to the prime.
A joint venture creates a new legal entity (typically an LLC) owned by two or more member companies. The JV entity submits the proposal and holds the contract. Both members contribute resources and share in management, risk, and reward according to the JV operating agreement.
Joint ventures are particularly valuable for small business contracting. Under SBA rules, a joint venture between a small business and a large business can qualify as a small business if structured under an approved mentor-protege agreement. This allows small businesses to access the capabilities and past performance of their large business mentor while maintaining small business eligibility for set-aside contracts.
| Factor | Prime-Sub | Joint Venture |
|---|---|---|
| Setup Complexity | Low | High (new legal entity) |
| Past Performance | Prime's record used | Both members' records available |
| Small Business Eligibility | Prime must qualify | Can qualify via mentor-protege |
| Risk Sharing | Prime bears most risk | Shared per agreement |
| Revenue Share | Sub gets subcontract value only | Shared per ownership/agreement |
| Customer Relationship | Prime owns | Both members engage |
A well-drafted teaming agreement protects both parties and minimizes disputes. While every agreement should be reviewed by legal counsel experienced in government contracting, here are the essential clauses.
Identify the specific opportunity (solicitation number, agency, title) the team is pursuing. Limit the agreement to that opportunity unless you intend a broader relationship.
Define which company serves as prime and which as subcontractor(s). Specify who leads proposal development, who provides which subject matter experts, and who manages the customer relationship during capture.
Specify the anticipated percentage of work (by dollar value or labor hours) each party will perform. This is especially important for small business set-asides where the prime must perform a minimum percentage of the work (typically 50% for services under FAR 52.219-14).
Define how subcontract pricing will be established. Will rates be fixed now or negotiated later? Who bears proposal costs? What happens to shared bid and proposal expenses if the team loses?
Specify whether team members are prohibited from teaming with other companies on the same opportunity. Exclusivity protects against teammates joining a competing team but limits your options if the relationship deteriorates.
Define the duration of the agreement (typically through contract award and execution of the subcontract) and the conditions under which either party can terminate. Include what happens to shared work product if the agreement is terminated.
State the prime's obligation to negotiate and award a subcontract to the teammate in good faith if the team wins. Without this clause, the prime could win using the teammate's capabilities and then not subcontract to them. Include specifics on subcontract type, terms, and negotiation timeline.
Specify how disputes will be resolved — negotiation, mediation, arbitration, or litigation. Include the governing jurisdiction and applicable law.
A Non-Disclosure Agreement (NDA) should be executed before or simultaneously with the teaming agreement. The NDA protects confidential information exchanged during teaming discussions, proposal development, and any pre-award collaboration.
Most teaming NDAs should be mutual (both parties agree to protect the other's confidential information) because both sides share proprietary data during proposal development. A one-way NDA may be appropriate in situations where only one party is disclosing sensitive information, but this is rare in genuine teaming relationships.
Some teams include confidentiality provisions directly in the teaming agreement rather than executing a separate NDA. This simplifies the documentation but creates a risk: if the teaming agreement is terminated, the confidentiality obligations may also terminate unless the agreement explicitly states that confidentiality survives termination. A standalone NDA that is cross-referenced in the teaming agreement provides cleaner protection.
Teaming introduces management complexity, shared margins, and partnership risk. It should be a strategic choice, not a default. Here is a framework for making the decision.
Finding the right teaming partner is critical. Start by researching who has relevant past performance using USAspending and FPDS data. Look for companies with complementary (not overlapping) capabilities. Check contractor profiles on Bureauify to understand potential partners' federal portfolios, agency relationships, and contract history. Attend industry days and pre-solicitation conferences where agencies encourage contractor networking.
Before entering a teaming agreement, assess the potential partner's financial stability, reputation, relevant past performance, organizational conflicts of interest, and cultural compatibility. Check the SAM.gov exclusions database to verify they are not debarred or suspended. Ask for references from their other teaming relationships. A bad teammate is worse than no teammate at all.
Bureauify's contractor data helps you identify potential teaming partners with complementary capabilities, relevant past performance, and the right agency relationships.
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