One of the policies that aim to target inequality and stimulate economic growth is Broad-Based Black Economic Empowerment (B-BBEE) whose key objective is to promote economic participation and equitable wealth distribution.

The main objective of B-BBEE is the inclusion of black people (defined broadly as Africans, Indians and Coloureds) in the economy, within a larger goal of national empowerment, targeting historically disadvantaged people such as black people, women, the youth, rural communities and disabled people.

Some of the critical objectives of B-BBEE include:

  • Empowering local and rural communities to have equal access to economic opportunities.
  • Increasing access to infrastructure, skills training programmes and economic activities for black people.
  • Improving human resource development of black people through programmes such as learnerships.
  • Empowering black people to manage and/or own businesses by including black women, workers, communities, co-operatives, etc.
  • Promoting investment that leads to broad-based participation in the economy by black people.

Early this year Deputy Director: BBBEE, Sphiwe Ndlovu from Gauteng Department of Economic Development gave more insight into this policy. She said B-BBBEE  means the viable economic empowerment of all black people, particularly black women and black youth living with disabilities.

 Ndlovu gave the below tips every business owner should know about BBBEE Codes and Compliance.

1.  B-BBEE certificate/affidavit is only valid for one year.

2. The Trumping  Clause Provision which stipulates that in the event of any conflict between the B-BBEE Act and any other law in force immediately prior to the date of commencement of the B-BBEE Act, where such conflict relates to a matter dealt with in the B-BBEE Act as amended, the B-BBEE Act shall prevail.

3. The three elements of the codes that have been identified as priority elements which are Ownership, Skills Development and Enterprise Development.

   Missing a sub-minimum target in one or more of the priority elements results in discounting your BEE level by one level e.g.  Level 6 (Recognition Level) would become Level 7 (Recorded Level).

    4. ‘Black People’ is a generic term which means Africans, Coloureds and Indians;

   (a)who are citizens of the Republic of South Africa by birth or descent; or

  (b)Who became citizens of the Republic of South Africa by naturalization

5. Before 27 April 1994

On or after 27 April 1994 who would have been entitled to acquire citizenship by naturalisation prior to that date

Ndlovu  listed the top 5 tips every business owner should know, in order to not violate BBBEE Codes:

  • Know the definition of black.
  • Know and understand what ownership means.
  • Be aware of fronting and what it means.
  • Subject to section 9(6), an enterprise in a sector in respect of which the Minister has issued a sector code of good practice in terms of section 9, may only be measured for compliance with the requirements of broad-based black economic empowerment in accordance with that code.
  • Enterprises operating in a sector in respect of which the Minister has issued a sector code of good practice in terms of section 9, must report annually on their compliance with broad-based black economic empowerment to the sector council which may have been established for that sector.

Ndlovu made it clear that B-BBEE is a vital element of the progressive socio-economic revolution of the country and that it is not about the empowerment of a single group of individuals at the expense of another. It is about increasing the economic involvement of previously disadvantaged groups to the benefit of all citizens.

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