Block exemption regulations for small, micro and medium-sized businesses
The purpose of the Regulation, Gazette Number 50746, Regulation 2538 dated 03 June 2024, is to exempt a category of agreements or practices among SMMEs contained in the Schedule from the application of sections 4(1) and 5(1) of the Act to enable collaboration among SMMEs that otherwise would contravene the Competition Act No. 89 of […]
Amended Forest Sector Code (FSC) – Part 2 – Sector-specific principles and applications of the code
The Amended Forest Sector Code was published in Gazette 40803 on 21 April 2017. This is the second in a series of articles listing the basics of this sector code. SECTOR SPECIFIC PRINCIPLES The Forest Sector has adopted the following sector-specific principles that guided the formulation of the FSC and are to be applied with […]
Amended Forest Sector Code (FSC) – Part 1 – Objectives and Key Principles
The Amended Forest Sector Code was published in Gazette 40803 on 21 April 2017. This is the first in a series of articles listing the basics of this sector code. The sector code lists a few objectives as shown below: KEY PRINCIPLES MEASUREMENT PRINCIPLES The fundamental principle for measuring B-BBEE compliance is that substance takes […]
B-BBEE REQUIREMENTS FOR JOINT VENTURES
What is a Joint Venture? Structures in business are not always simple. Implementing B-BBEE has revealed various complex structures, including joint ventures. A joint venture is a business arrangement wherein two or more parties, whether as individuals or entities, agree to combine resources for a specific business undertaking for profit. Two types of joint ventures […]
Rules for discretionary collective enterprises and BEE
Source: Government Gazette Number 44591 The purpose of the article is to provide clarity on how ownership by entities such as Broad-Based Schemes, Employee Share Ownership Programmes, Trade Unions, Not-for-Profit Companies, Co-operatives, Trusts (together “Collective Enterprises”) should be interpreted under the B-BBEE Codes of Good Practice (the “Codes) and arising from the DTIC’s Practice Note. […]
BEE and owner-driver schemes
Owner-driver schemes concern the creation of independent, small businesses by outsourcing the distribution function of larger enterprises. These businesses are typically run by former (and/or current) employees, but, with maturity, some schemes look externally for their owner-drivers. A transfer of assets, namely the vehicle(s), accompanies the implementation of the scheme. They are similar to franchising: […]
B-BBEE’s Leniency Programme
Historically, the Leniency Programme was a compliance mechanism that encouraged reporting of all major B-BBEE transactions prior to the promulgation of the amended B-BBEE Act, as well as promote adherence to the B-BEEE Act. The B-BBEE Act in section 13F(3)(b)(ii) permits the B-BBEE Commission to issue non-binding advisory opinion on any provision of the B-BBEE […]
Socio-Economic Development Element
What does the Socio-Economic Development Element entail? According to paragraph 7 of Statement 000 of the Codes of Good Practice (the Codes), one of the elements identified to advance empowerment of black people is Socio-Economic Development (SED) which is contained in Statement 500. Every measured entity on an annual basis is required to contribute 1% […]
Understanding recognition of ownership through a private equity fund
What does a Private Equity Fund for B-BBEE purposes entail? The ownership element of the Codes of Good Practice (the Codes) seeks to achieve a substantial change in the racial composition of ownership and management structures of existing and new enterprises. The use of private equity funds is one of the ways to ensure that […]
BEE Guidelines on Complex Structures & Transactions, and Fronting
The BEE Commission published a summary document combining the key topics surrounding Broad-Based Black Economic Empowerment (B-BBEE) and its implementation for Complex Structures and Transactions, and Fronting. The Guide is published in two sections. • Section A: Complex Structures & Transactions• Section B: Fronting This article will deal with Section A only. A second article […]