Summary of the bbbee codes of good practice, july 2007 pdf threshold for major bbbee transactions. The amended financial sector code for black economic. The revised codes as they are commonly known, have significantly impacted the requirements for bbbee compliance. Construction sector code in terms of section 91 of the broad based black economic empowerment act, act no. New bbbee codes present opportunity apr 10, 2015 midsized businesses face a significant challenge in transforming their businesses to comply with the stricter revised broadbased black economic empowerment bbbee codes that will come into effect on 1 may this year. In february 2007, the dti gazetted the black economic empowerment bee codes of good practice, in terms of which a number of transformation sector charters also referred to as sector charters were introduced, vetted and analysed for compliance, as per the stipulations of either section 9 or 12 of the bbbee act, no. The broad based black economic empowerment bbbee act, gazetted in 2007, will be used on all financial periods ending before 1 may 2015.
The latest bbbee codes see the merger of management control and employment equity into a singular element titled management control. Codes not aligned and ready for gazette by the end of october 2015, a consideration shall be made for them to be repealed. Tax considerations when entering into transactions for bee. Dti unpacks amended bee codes to soften blow for business. Under the current codes and the new codes, the elements of bbbee on which an. Broadbased black economic empowerment act section 9 5. Old bbbee codes vs new bbbee codes cenfed bbbee agency. Certain amendments to the codes have been proposed by the minister of. The amended bbbee codes of good practice new codes, which came into effect on 1 may.
Implementation of the amended codes of good practice 1 may 2015. On 11 october 20 the minister of trade and industry dti, dr rob davies, gazetted the revised broadbased black economic empowerment bbbee codes. Amendments and duration of the amended ict sector code at the benchmark of empowerment 5 the amended information and communication technology ict broadbased black economic bbbee sector code was gazetted by the department of trade and industry dti on 7 november 2016. On 11 october 20, dti published the amended bbbee codes of good practice which will come into effect on 30 april 2015. The new bee codes or broadbased black economic empowerment codes that was released in south africa in 2015 will. If your financial year end is after 30 april 2015, you have to be verified in accordance with the amended codes. The new council aligned the tourism bbbee sector code to the amended bbbee generic codes of good practice which had been issued by the minister of trade and industry in october 20. New thresholds and bbbee status levels for emes and qses. A strategy for broadbased black economic empowerment, download the strategy pdf. Business is concerned that transactions entered into to. Tax considerations when entering into transactions for bee purposes. Each sector industry council is required to compile their own bbbee scorecard.
A measured entity must achieve a minimum of 40% in all three priority elements, namely net value on the ownership scorecard, skills development and enterprise and supplier development. Bee certificates issued under previous codes remain valid. Each update of the united states code is a release point. The number of categories for compliance was seven under the. Cliffe dekker hofmeyr is very pleased to have achieved a level 1 bbbee verification under the new bbbee codes of good practice.
The broad based black economic empowerment commission bbbee commission is an entity established by the broadbased black economic empowerment act 53 of. The biggest impact of the revised bee codes that came into effect on 1 may, will be on smaller companies. Revised notice of clarification on application of the bbbee codes of good practice. In 20, the current bbbee codes of good practice were substantially amended by the department of trade and industry dti. This includes supplemental reports for crashes that occurred during this time period. The amended codes came into effect on 1 may 2015 in accordance with notice 444, gazette no. The amended bbbee codes will probably result in the average verification level being a level 7 for those businesses who are not innovative or who do not adopt an integrated approach to bbbee. The dti on the other hand expect the revised codes to enhance the implementation of bbbee in a meaningful and sustainable manner. Cliffe dekker hofmeyr recent changes to the bee landscape. Article tax relief in sight for bee transactions 100407 2. For example, at 65 points a level 4 current codes is automatically downgraded to a level 7. The broadbased black economic empowerment act 53 of 2003 bbbee act provides the legislative framework for broadbased black economic empowerment in south africa bbbee.
Inspiring empowerment through innovation, research and technology. Apr 10, 2015 new bbbee codes present opportunity apr 10, 2015 midsized businesses face a significant challenge in transforming their businesses to comply with the stricter revised broadbased black economic empowerment bbbee codes that will come into effect on 1 may this year. Johannesburg the ownership component of the new broad based black economic empowerment bbbee codes was a challenge and difficult for multinational companies, ford motor company of. If your financial period should end after 1 may 2015, the new gazetted bbbee verification codes must be used. Codes of good practice it is hereby notified that the minister of trade and industry hereby issues the following draft code of good practice for public comments under section 93 of the broadbased black economic empowerment. The original bbbee legislation comprised the broadbased black economic empowerment act, number 53 of 2003, and its supplementary, detailed codes of. These new bee codes of good practice came into operation on 30 april 2015 and are replacing the existing bee codes of good practice. New qse scorecard element code series old qse code weighting new qse code weighting ownership 100 25 25 management control 200 25 15 employment equity 25. Under the new legislation, compliance with bbbee remains entirely voluntary. Transition period for sector code alignment extended to 31 october. Previously companies, especially foreignowned companies were able to achieve high bbbee scores by focusing on other elements and avoiding any equity. The broadbased black economic empowerment act 53 of 2003 bbbee act provides the legislative framework for broadbased black economic empowerment bbbee in south africa. Compliance with the provisions of the revised codes will be compulsory from the 01st of may 2015 for all entities.
The following table represents the new bbbee generic scorecard. In this article, we provide an overview of the major differences in the old bbbee codes versus the new bbbee codes. The amended tourism bbbee sector code was published in the government gazette on 20 november 2015 and is now effective across. On the 3rd october 2012, the minister of trade and industry, dr rob davies, released the revised bbbee codes. Ownership has become an even more important requirement in the updated broadbased black economic empowerment codes of good practice that will come into effect from may 1 st, 2015, necessitating a wide range of companies to assess their structures and strategies in order to remain compliant. These include legislative amendments to the broadbased black economic empowerment act bbbee act in 2014, changes to the bbbee codes in 2015 and more recently, regulations being issued in terms of the bbbee act in june 2016. Find an accountant the official south african website. Some history was given to the introduction of the broadbased black economic empowerment bbbee act 53 of 2003, which had come into operation on 24 october 2014. The primary purpose of the bbbee act and the codes is to address the legacy of racist apartheid policies and enhance the economic participation of black people in the south african economy. It is imperative that companies measure themselves in terms of the revisions then plot their path to return to former levels. Revised formulas for code series 200 and 300, fifth criterion for empowering supplier. The international codes i codes are the widely accepted, comprehensive set of model codes used in the us and abroad to help ensure the engineering of safe, sustainable, affordable and resilient structures. In addition to the big ticket amendments presented at pmis recent workshops on the amended bbbee codes workshops held in durban, port elizabeth, cape town and johannesburg earlier this month, there have been further updates that are worth noting.
The new legislation is quite a bit stricter, especially in its scoring and the manner of calculating bbbee compliance levels, or status, has changed in many regards. Profit after tax npat of the measured entity as determined in accordance. The practical guide to the amended bbbee codes of good practice will assist the implementers of bbbee on the ground to understand the fundamental measurement principles not only in form, but more significantly in substance. Dr rob davis, mp minister of trade and industry date. All files are current through public law 1168 04102020, except 1161. In calculating their ownership score, measured entities must treat bbbee facilitators as having. The generic scorecard in the 2017 property sector code differs in relation to the allocation of points on the scorecard from the 2012 property sector code.
In simple terms, if an organisation fails to obtain 40% of the points allocated in any of these elements, its rating will be discounted by one level. Previously, management control and employment equity were worth 11 and 18 points on the bbbee scorecard respectively. The amended ict sector code is effective and legally binding from. Skills development has always been regarded as an important pillar for economic. Ownership has become an even more important requirement in the updated broadbased black economic empowerment codes of good practice that will come into effect from may 1 st, 2015, necessitating a wide range of companies to assess their structures and strategies in. Constitutional mandate for bbbee bbbee journey ushering in a new era for empowerment bbbee. Broadbased black economic empowerment bbbee codes of good practice. Aug 12, 2017 the broadbased black economic empowerment codes of good practice aim to level the playing field for all operating in the south african economy by providing clear and comprehensive criteria for the measurement of broadbased bee. Ownership will become a new focus of the proposed changes to the codes and all companies will have to work even harder at obtaining and maintaining their bbbee scorecards sapa, 22 august 2012. Bbbee code of good practice bbbee commission department. On 11 october 20 the revised broadbased black economic empowerment bbbee codes were gazetted by the minister of trade and industry dti. Dr rob d vies, mp ministe of trade and industry dated 1. This follows a period of debate and further amendments to the draft codes which were released by the minister of trade and industry minister in october last year. The amended financial sector code amended fsc was promulgated on 1 december 2017 in government gazette number 41287.
The revised codes will have a significant impact on all businesses that currently have a bbbee certificate and even more so on businesses that do not have one. The key in structuring any deal is to understand the tax implications at the time of entering and exiting a deal in order to maximize the tax efficiency for all parties concerned. May 20, 2015 the biggest impact of the revised bee codes that came into effect on 1 may, will be on smaller companies. Feb 17, 2016 is there any benefit for an eme to get a black partner bbbee speaking. Since 2001, empowerdex has been redefining empowerment in africa and taking it to new heights by achieving milestones that stand testament to africas continuous development and involvement in the broadbased black economic empowerment bbbee landscape. Oct 15, 2015 introduction to za and what we are trying to achieve on our site. The international code council icc is a nonprofit organization dedicated to developing model codes and standards used in the design, build and compliance process.
Titles in bold have been changed since the last release point. This gazette is also available free online at za staatskoerant, 5 mei 2015 no. The codes place a lot more emphasis on black ownership and control and all companies should consider the codes carefully as there are different applications in the general code for different categories of enterprises. The amended broadbased black economic empowerment bee codes of. A major difference in the old bbbee codes versus the new bbbee codes is that fronting that is, pretending to be compliant, or otherwise providing false information related to bbbee, is now a crime, punishable by jail time and or fines. Minister davies says the refined codes symbolise a new beginning in the reorientation of the transformation policy to focus more on productive bbbee and the growth of black entrepreneurs through enterprise and supplier development elements. Understanding skills development for bbbee purposes introduction understanding skills development is no longer only a nicetohave, it is a necessity for all companies. Bbbee code of good practice our legislative mandate emanates from the act, which includes the regulations and the codes. Part 2 of the amended bbbee codes of good practice. This page provides downloadable files for the current release point. The minister of trade and industry, dr rob davies mp may from time to time issue notices to clarify or guide the implementation of the act, and this is done through the government gazette. Minister davies says the refined codes symbolise a new beginning in the reorientation of the. The broadbased black economic empowerment practice guide 02 of 2017 application of the 2007 codes of good practice 1. Amended bbbee codes the amended bbbee codes of good practice on broadbased black economic empowerment gazetted on 01 may 2015 as part of the broadbased black economic empowerment act, act no.
The revisions to broadbased black economic empowerment bbbee, or bee legislation that came into effect in may 2015 continue to cause confusion and anxiety among business owners in south africa. Codes of good practice may be issued by the minister of trade and industry under the bbbee act and such codes may be generic i. The bbbee codes of good practice the codes came into effect on 1 may 2015. The new codes will replace the existing bee codes of good practice when they come into operation in october 2014. In october 2014 these new codes will come into operation thereby replacing the existing bee codes of good practice. Under the new codes, the unified element is worth a total of 19 15 points plus four bonus. More than 90% of companies that participated in the survey believe that the implementation of the revised bbbee codes will have a detrimental effect on their current rating level.
Codes were published on 11 october 20 and came into effect on 1 may 2015. The amended financial sector code for black economic empowerment. The amended codes became effective on 1 may 2015, but if your financial year end is prior 30 april 2015, you can still be verified in accordance with the old codes. The main feature of the charter is a set target of 5% net profit after tax to be spend on enterprise. Easy guide for the amended tourism bbbee sector code. Current codes level 1 level 2 level 4 level 5 level 7 level 8 level 3 non compliant an increase in the number of points per level, will result in an automatic downgrade of most enterprises as at 1 may 2015.
Management documentation document source person received official eea2 and eea4 forms as submitted to the department of labour the cm27 and cm29 forms, as submitted to cipro employment records written confirmation of. A bbbee commission was in the process of being established, and an acting commissioner had been appointed. Amendments to the broadbased black economic empowerment act, no 53 of 2003 bbbee act became effective from october 2014 and amendments to the codes of good practice on black economic empowerment bbbee codes, originally gazetted in 20, became effective in may 2015. Significant changes to the existing generic codes were published in the government gazette on 11 october 20 and will take effect from 1 may 2015. Means any of the following using the corresponding institution, designation and practice number. Broadbased black economic empowerment amendment act, 20 act no.
Official handover of the amended tourism bbbee sector code by the minister of tourism, derek hanekom. Phase 2 of the amended codes gazette 38766 of 6 may 2015 sets out the process for developing and gazetting sector codes, as well as the approach for drawing up sector codes, and the role of sector charter councils. Black economic empowerment codes of good practice brand. The amended broadbased black economicempowerment codes of good practice come into effect on may 1 2015. Ownership takes centre stage under updated bbbee codes. The amended codes of good practice for broadbased black economic empowerment that came into effect on 1 may 2015 will significantly reduce current compliance levels by two to three levels. Tax relief in sight for bee transactions jackie arendse independent tax specialist email. The revised broadbased black economic empowerment bbbee codes were gazetted by the minister of trade and industry dti in 20. Education campaign for both phase 1 and 2 conducted with stakeholders since 20. The revised notice of clarification was released by the dti in the government gazette 38799 15 may 2015.
Amended construction sector codes of good practice beesa. How will the revised bbbee codes affect your outcome. The practical guide to the amended bbbee codes of good. Bee deals the tax considerations september 2007 issue 97 an important aspect of any bee transaction is the tax implications of structuring the deal. The codes of good practice may be issued under the bbbee act and such codes may be sector specific or generic i. The codes came into effect on 1 may 2015 phase 2 of the codes was gazetted on 6 may 2015 20%. Presentation to the portfolio committee on trade and industry. From 1 november 2015, sector codes that are aligned shall be effective in accordance with paragraph b of this notice. It was prepared in terms of the broadbased black economic empowerment act 53. Johannesburg the ownership component of the new broad based black economic empowerment bbbee codes was a challenge and difficult for multinational companies, ford motor company of southern. The importance of skills development and the new bbbee codes. The current generic codes of good practice codes were published on 11 october 20 and came into effect on 1 may 2015.
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