For SBA lenders
Short answer
Affiliation arises when individuals or entities serving as officers, directors, or managing members of one business also hold similar positions or influence in another, indicating common control.
Common management exists when the CEO or President of one concern controls the board of directors and/or the management of another concern. Overlapping officers, directors, or key employees can indicate that the businesses operate under common control, requiring their financials to be aggregated for SBA size standard determination. This applies regardless of direct ownership ties.
Mr. Smith is the CEO of Company X, the applicant for a 7(a) loan. He is also the Chairman of the Board for Company Y, a separate entity. Even without owning shares in Company Y, his leadership roles in both suggest common management, which could trigger affiliation between Company X and Company Y, requiring combined size testing.
SOP 50 10 - Lender and Development Company Loan Programs
13 CFR Part 121 - Small Business Size Regulations
Affiliation and Lending Criteria for SBA Business Loan Programs - Final Rule
Last checked 2026-06-13. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-13 · SBA sources checked through 2026-06-13. DealRoom analysis of public SBA 7(a) lending records (FY2020–present). Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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