BB(BE)E ready to roll
South Africa has come a long way since the apartheid era, with many steps being taken to correct the injustices of the past …
Come May 2015, however, a company’s Black Economic Empowerment (BEE) rating will drop dramatically if it doesn’t restructure its business. New, generic Codes of Good Practice of the Broad-Based BEE (BBBEE) will emphasise the net value of black shareholders’ interests and the classification of ownership.
“The fact that this date may be extended merely, potentially, gives companies extra time,” write Malcolm Hartwell and Allison Williams, directors at Norton Rose Fulbright – a global legal practice. “But, until the extension is granted, the reality is that companies that take no action will probably find their score dropping.”
Closer to “home”, the BBBEE transport sub-sector codes (which had to be produced by December 18, 2013) have to be aligned with the generic codes that come into effect in May. “They will impose a significantly higher burden on companies wishing to comply with the BBBEE legislation,” states the Norton Rose Fulbright duo.
The requirements of the new transport sub-sector codes will, unfortunately, only be revealed later this year. “These new codes will, however, impose obligations at least as stringent as those in the generic codes,” write Hartwell and Williams.
They add that the codes will also place greater emphasis on training and development. “This creates an opportunity for companies, that are unable or unwilling to restructure their ownership, to improve their score.”