What is Broad Based Black Economic Empowerment? (BBBEE or B-BBEE)
Broad Based Black Economic Empowerment is the South African Government’s economic policy to accelerate the participation of black people (as defined) into the economy.
The enabling Legislation was promulgated in 2003 as the Broad Based Black Economic Empowerment Act 53 of 2003, and The Codes of Good Practice and certain sector specific charters were promulgated as a result of this enabling Act 53 of 2003.
Through legislation, change is encouraged in the areas of ownership, management and control, employment equity, skills development, preferential procurement, enterprise development and socio-economic development.
If BBBEE is implemented correctly, it will increase job creation and economic growth, with more per definition black people being brought into the mainstream economy.
In short, BBBEE is a very well thought-out empowerment plan, a plan which if utilized correctly, has the potential to benefit all contributing parties.
How is BBBEE measured?
This depends on the size of the enterprise to be measured, what industry such enterprise operates in, and on which financial statements will be used to classify an enterprise.
A BBBEE professional should be consulted to ensure that you are correctly classified.
Are there penalties for non-compliance with BBBEE?
There is no legal obligation on enterprises to comply with BBBEE, but, an enterprise’s BBBEE status will affect its ability to successfully tender for any Government tenders and or apply for licenses such as Mining or Gambling licences.
In the Private Sector it became increasingly important to have a favourable BBBEE status, as this is taken into account for preferential procurement purposes in order to increase the enterprises own BBBEE scorecard.
An unfavourable or no BBBEE status, with no effort in increasing such status, could therefore have the effect that a once thriving enterprise would have to close its doors.
Who can issue a BBBEE Certificate for me?
As from 30 September 2016, SANAS returns as the only BBBEE Accreditation body for Verification Agencies.
This entails that IRBA accredited verification agencies are not allowed to engage in new verifications after 30 September 2016, but are allowed to finalize verifications referred to them prior to that date – and was given extension until 31 December 2016.
Are the “new BBBEE Codes” applicable to me?
This depends on which industry an enterprise operates in and on whether there is a current applicable Charter for that specific industry. If not, chances are that the “new BBBEE Codes” will apply to that enterprise.
If the enterprise’s financial statements ends on a date post the effective date of the “new BBBEE Codes”, then this will need to be applied in verifying such enterprise.
Greyvensteins Inc BBBEE services
At Greyvensteins Inc., we are happy to discuss and explore all viable options available for black economic empowerment, and offer the complete solution to BBBEE for each individual client.
We offer full BBBEE consultation services, on all elements of BBBEE, and prepare and assist our clients for BBBEE verification.
To contact BBBEE Consultants Cape Town, BBBEE Consultants Johannesburg or BBBEE Consultants Port Elizabeth make an appointment with Greyvensteins Inc to discuss the best BBBEE solution for your business.