Who is considered “disadvantaged” for purpose of a Disadvantaged Business Enterprise (DBE) and Minority Business Enterprise (MBE) Certification? The answer may surprise you.

October 19, 2020
By Danielle Dietrich
Posted in Business Services, Women and Diverse-Owned Businesses

For purposes of Disadvantaged Business Enterprise (otherwise known as “DBE”) Certification, the Code of Federal Regulations, 49 C.F.R. §§ 26.5 and 26.67(a)(1) provide that there is a rebuttable presumption of disadvantage for United States citizens (or lawful admitted permanent residents) who are:

  • Women;
  • Black Americans;
  • Hispanic Americans (persons of Mexican, Puerto Rican, Cuban, Dominican, Central or South American, or other Spanish or Portuguese culture or origin);
  • Native Americans (persons who are enrolled members of a federally or state recognized Indian tribe, Alaska Natives or Native Hawaiians);
  • Asian-Pacific Americans (persons whose origins are from Japan, China, Taiwan, Korea, Burma (Myanmar), Vietnam, Laos, Cambodia (Kampuchea), Thailand, Malaysia, Indonesia, the Philippines, Brunei, Samoa, Guan, the U.S. Trust Territories of the Pacific Islands, Samoa, Macao, Fiji, Tonga, Kirbati, Tuvalu, Nauru, Federated States of Micronesia or Hong Kong);
  • Subcontinent Asian Americans (persons whose origins are from India, Pakistan, Bangladesh, Bhutan, the Maldives Islands, Nepal or Sri Lanka); or
  • Other minorities found to be disadvantaged by the SBA.

It may be a surprise to some that persons of Middle Eastern and North African origin are not considered disadvantaged by the DBE program.  In fact, the U.S. Department of Transportation has found that “[p]ersons of Lebanese and other Middle Eastern origins are not presumed disadvantaged under the regulations.”    In re SanUVAire, LLC, No. 20-0029, March 30, 2020.

Persons of Middle Eastern origins may also not be eligible for certain Minority Business Enterprise certifications, though it can be inconsistent from group to group.  While the Southern Region Minority Supplier Development Council allows certification of persons of Middle Eastern origin, the Eastern Minority Supplier Development Council does not, even though both are affiliated with the National Minority Supplier Diversity Council.

If your company needs advice regarding DBE or MBE certification, please contact Danielle Dietrich at 412-227-0284 or ddietrich@smgglaw.com.