1. B-BBEE Presentation to Technical Review Committee

2. Background
In terms of section 9 of the B-BBEE Act, the Minister is empowered to issue the Codes of Good Practice (the Codes).
We have the generic Codes and Sector Codes.
Instrument to drive transformation within the economy.
Applicable to both public and private sector.

3. Accreditation Program for BBBEE VA’s
Accreditation of BEE verification agencies is conducted by SANAS on behalf of the dti in terms of the accreditation criteria, and is maintained and enforced by SANAS
Broad-Based Black Economic Empowerment Amendment Act, 2013.
B-BBEE Codes of Good Practice
Verification manual (Government Gazette 31255)
Sector Codes
R47 Accreditation standards

4. Code Series 000: Principles
The Codes measures 5 elements:
Ownership : 25 points;
Management Control: 19 points;
Skills Development: 20 points;
Enterprise and Supplier Development: 40 points; and
Socio- Economic Development: 5 points.
Points achieved will result into a B-BBEE recognition status, there are eight recognition levels.

5. Code Series 000: Principles
B-BBEE Status
Qualification
B-BBEE Recognition
Level One Contributor
≥100 points on the Generic Scorecard
135%
Level Two Contributor
≥95 but <100 points on the Generic Scorecard
125%
Level Three Contributor
≥90 but < 95 points on the Generic Scorecard
110%
Level Four Contributor
≥80 but < 90 points on the Generic Scorecard
100%
Level Five Contributor
≥75 but < 80 points on the Generic Scorecard
80%
Level Six Contributor
≥70 but < 75 points on the Generic Scorecard
60%
Level Seven Contributor
≥55 but < 70 points on the Generic Scorecard
50%
Level Eight Contributor
≥40 but < 50 points on the Generic Scorecard
10%
Non-compliant Contributor
<40 points on the Generic Scorecard 0%

6. Code Series 000: Principles
Classify measured entities based on annual turnover, gross receipts or allocated budget :
Exempted Micro Enterprises (EME): 0 – R10 million.
No verification requirements.
Enhanced recognition for black owned EMEs.
Qualifying Small Enterprises (QSE): above R10 million but less R50 million.
Comply with the QSE scorecard.
Enhanced recognition for black owned QSEs.
Large Enterprises: above R 50 million

7. Code Series 000: Principles
Measured entities to comply with priority elements under the following conditions:
QSE to comply with at least two of the priority elements:
Ownership is compulsory; and either
Enterprise & Supplier Development or Skills Development.
Large enterprises to comply with all priority elements.
Measured entities who do not meet the thresholds in priority elements, the overall score will be discounted one (1) level down.

8. Code Series 000: Principles
Also covers the following Statements:
Statement 003: Development of sector Codes.
Statement 004: Specialised entities.
no ownership.
Statement 005: Requirements for verification.

9. Ownership Change ownership patterns of the economy.
Target of 25.1% Ownership.
Measure three aspects: exercisable voting rights, economic interest, and net value.
The 40% sub-minimum is applicable on NET VALUE.
Designated groups included in the main scorecard.
Threshold for new entrants increased to R50 million.
Sale of asset/business qualify for ownership points.

10. Code Series 200: MANAGEMENT CONTROL
Increase number of existing and new enterprises controlled and managed by black people.
Merged Management Control and Employment Equity element.
The compliance targets for Management Control are aligned with the Economically Active Population (EAP) targets as annually published by the Department of Labour.
Entities apply National or Provincial EAP depending on locality.

11. Code Series 300: SKILLS DEVELOPMENT
Increase investment towards human resource and skills development of black people.
The compliance target increased from 3% to 6% to cover both employees and non-employees training expenditure.
40% sub-minimum apply to total points (40% of 20 points).
Introduced a 15% cap for non-core training costs such as accommodation, catering etc.
Introduced a 15% cap on Category F & G training (informal training).
The compliance targets are based on EAP targets.

12. Code Series 400: ENTERPRISE & SUPPLIER DEVELOPMENT
Promote procurement from B-BBEE compliant suppliers and increase financial support towards black entities.
Measures the following: preferential procurement, supplier development, and enterprise development.
The aim is to strengthen local procurement and enhancing local supplier development programmes.
40% sub-minimum apply to the total points of each criteria.
Beneficiaries of enterprise and supplier development are EMEs or QSEs which are at least 51% black owned or at least 51% black women owned.

13. Code Series 400: ENTERPRISE & SUPPLIER DEVELOPMENT
Enterprise and Supplier Development Contributions are recognisable on an annual basis.
Cumulative recognition is only allowed for long term projects.
Imports exclusion principle maintained with overriding proviso that imports are not applicable in Designated Sectors.
The exclusion of imports are subjected to the entity having developed a plan. This plan should include:
Clear objectives and priority interventions; and
Key performance indicators and implementation plan

14. Code Series 500: SOCIO-ECONOMIC DEVELOPMENT
Measures socio-economic contributions aimed at promoting access to mainstream economy for black people.
Targeting rural and under-developed areas.
1% NPAT on annual basis.
75% of beneficiaries must be black people.

15. Agri-BEE Charter 28 December 2012
The Charter aims to support the acceleration of land reform in South Africa by setting a target for equity and land ownership. Landowners are incentivised with bonus points for transferring to black people in excess of the 30% land reform target. There is also recognition for long-term leases under enterprise development and socio-economic development elements.
Enhanced recognition is given to initiatives that result in Greenfield ventures, job creation and beneficiation of primary products, and support industrialisation.

16. Financial Sector Charter 26 November 2012
The Minister of Trade and Industry gazetted the Financial Services Sector Code, which provides transformation guidelines for the financial sector, one of the key sectors of the South African economy.
The Minister also approved the application of the 'once empowered, always empowered' principle with a condition that Government, together with the Financial Services Sector Charter Council, monitor the dilution of black shareholding in the sector.

17. Financial Sector Charter 26 November 2012
A review will be conducted every two years to determine the level of transformation in the sector and, in particular, the impact of the 'once empowered, always empowered' principle.
A key, unique feature of the Financial Sector Code is the introduction of an extra element, bringing the elements to eight in total and not seven as in the Generic Codes. The extra element, known as Access to Financial Services, aims to facilitate access to finance for black people and black-owned enterprises.

18. Information and Communication Technology (ICT) Charter 07 November 2016
The ICT has set a Black ownership target of 30% to accelerate the pace of transformation in the sector. The target is higher than the 25% target of the Generic Codes.
The target of 3% of the annual Net Profit After Tax (NPAT) for Enterprise Development (higher than 1% of the annual Net Profit After Tax target for the Generic Codes). The 3% target will be utilised by measured entities for the development of Black Owned ICT companies.

19. Information and Communication Technology (ICT) Charter 07 November 2016
The target for Socio Economic Development element has been set at 1.5% of the annual NPAT which is higher than the 1% of the annual NPAT of the Generic Codes. The aim is to bridge the digital divide by requiring that enterprises should undertake certain obligations in terms of access to ICT so as to improve the lives of the people. Such programmes could be in the form of providing ICT in education, health and programmes aimed at enhancing the lives of black communities.

20. Property Sector Charter 1 June 2012
The unique aspects of the property charter is that the charter introduces peculiar targets such as measurements for Economic Development which will be used by businesses and entities in the sector to invest in properties in underdeveloped areas and thus reduce service inequalities and the limited tradability of properties in these areas.
In recognition of the nature of the industry where majority of ownership by listed companies is through mandated investments that are far beyond 40%, a special consent is given for only property listed companies and Property Unit trusts to cap the mandated investment at 70% which is higher than the 40% in the Generic Codes.

21. Chartered Accountancy Sector Code 10 May 2011
With this charter, the Chartered Accountancy Profession aims to increase the number of black people, particularly black women entering the profession, to reflect the country's demographic population. Black Chartered Accountants have been identified as possessing critical skills that are in short supply and yet in great demand in South Africa. The Sector aims to achieve 32,5% black ownership target by 2016

22. Integrated Transport Sector Codes 21 August 2009
The Minister of Trade and Industry, Dr Rob Davies (MP) announced the gazetting of the Integrated Transport Sector Codes, in terms of the B-BBEE Act. The Integrated Transport Sector Codes comprise eight (8) sub-sectors, which seek to boost one of South Africa's largest infrastructure and Gross Domestic Product (GDP) contributors. In alignment with government's national transport action plan, the Codes aim to fast-track the implementation of efficient transportation, freight and logistics sectors within the economy.

23. Integrated Transport Sector Codes 21 August 2009
One of the main highlights is the achievement of a 35% black-ownership target, within a period of five (5) years, as prescribed by the Bus Commuter Service Sub-Sector Code. Unlike other Sector Codes gazetted earlier this year, the Integrated Transport Sector Codes will be continuously reviewed, at five (5) year intervals, from the date of publication thereof.

24. Forest Sector Code 12 June 2009
The Sector Code is an industry-agreed empowerment initiative in the Forest Sector and seeks to deal with transformation challenges in Forest Sub-Sectors of commercial primary growth, fibre production, contracting, sawmilling, pole and charcoal.
The Forest Sector Code gives bonus points as an incentive for enterprises to achieve the requisite 30% BEE ownership. It further seeks to encourage and support entities to undertake BEE-compliant procurement and job creation initiatives in the sector.

25. Marketing, Advertising and Communication (MAC) Sector Code 01 April 2016
Black Ownership target of 45% (30% is reserved for black women ownership) which should be achieved as of 31 March The 45% black ownership target is higher than the 25% target of the Generic Code. The 45% ownership was negotiated and agreed for by sector stakeholders and it will contribute towards increasing the number of black people that manage, own and control enterprises in the MAC sector.

26. Marketing, Advertising and Communication (MAC) Sector Code 01 April 2016
The increase of the absorption points to 10 under the Skills Development Element which is higher than the five in the Generic Codes. Entities in the sector will be rewarded more for training and for providing employment opportunities for young black graduates. This was done to increase a pool of human resources in the sector especially amongst young black people and also contribute towards addressing unemployment in the country.

27. Tourism Sector Code 20 November 2015
The Tourism B-BBEE Codes deviates from the Exempted Micro Enterprises, Qualifying Small Enterprises and Large Enterprise thresholds as set out in the Amended Generic Codes of Good Practice, to address the unique feature of the sector.
According to the Minister, these unique thresholds will ensure that as many enterprises in the sector contribute towards transformation, which will not be the case if the sector was using the Amended Generic Codes.
To create more opportunities for emerging black owned enterprises across the supply and value chains of established businesses, the sector has set the target for supplier development at 3% NPAT which is higher than the 2% of the Generic Codes. An implementation of supplier development in the sector will lead to job creation and overall growth in the sector.

28. Tourism Sector Code 20 November 2015
To create more opportunities for emerging black owned enterprises across the supply and value chains of established businesses, the sector has set the target for supplier development at 3% NPAT which is higher than the 2% of the Generic Codes. An implementation of supplier development in the sector will lead to job creation and overall growth in the sector.

29. Questions
Thank You