SBA Proposes to Overhaul 8(a) Social Disadvantage Standard and Open the Door to DEI-Based Claims

The Small Business Administration (SBA) on Wednesday, June 10, 2026, released a proposed rule, Reforms to Remove SBA’s 8(a) Program’s Rebuttable Presumption of Social Disadvantage for Individually Owned Firms Only; Reforms Do Not Impact Entity-Owned Firms, that would fundamentally rewrite how small business owners establish “social disadvantage” for purposes of the 8(a) Business Development Program. Published in the Federal Register on Thursday, June 11, the proposed rule would formally eliminate the longstanding (though recently disfavored) “rebuttable presumption” standard under which owners belonging to certain racial and ethnic groups are automatically presumed to be socially disadvantaged, and replace it with a new, facially race-neutral test. Under that test, any U.S. citizen could qualify for the 8(a) program by demonstrating that a government entity, university, or private corporation discriminated against a racial, ethnic, or cultural group to which they belong, or favored a group to which they do not belong, and that the discrimination materially harmed them.

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