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Must A Business Owner Seeking Certification As A Disadvantaged Business Enterprise (“DBE”) In Maryland Have Both Managerial And Technical Experience As It Relates To The Company’s Operations For Purposes Of Demonstrating Control?

Yes.  Under Maryland law, control is the exercise of the power to manage and operate a business enterprise.  In order to demonstrate control for DBE eligibility purposes, a business owner must have an overall understanding of, and managerial and technical competence and experience directly related to, the type of business in which the company is engaged and the company’s operations.

A business owner is not required to have experience or expertise in every critical area of the company’s operations, or have greater experience or expertise in a given field than managers or key employees.  However, he or she must have the ability to intelligently and critically evaluate information presented by others relating to the company’s business activities and use that information to make independent decisions concerning the company’s daily operations, management and policymaking.  Expertise limited to office management, administration or bookkeeping functions that are unrelated to the principal business activities of the company is generally insufficient to demonstrate control.  

Certification of a business can be a viable tool for developing and maintaining business relationships. Businesses seeking certification as a DBE in Maryland may want to consider obtaining legal advice concerning eligibility requirements for certification prior to applying for certification.