http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.29Change: -0.09
R/$ = 11.70Change: -0.05
Au 1207.85 $/ozChange: 1.57
Pt 1174.50 $/ozChange: -1.50
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Letters Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Oct 02, 2012

Amended BBBEE codes open for public comment

Back
DTI Minister Rob Davies launches the new BBBEE codes. Cameraman: Nicholas Boyd. Editing: Darlene Creamer. 02/10/2012
 
 
 
Africa|Education|Sustainable|Africa|Asia|South Africa|Building|Manufacturing|Rob Davies
Africa|Education|Sustainable|Africa|||Building|Manufacturing|
africa-company|education-company|sustainable|africa|asia|south-africa|building|manufacturing|rob-davies
© Reuse this



The Department of Trade and Industry (DTI) on Tuesday opened a 60-day period for comment on the revised broad-based black economic-empowerment (BBBEE) codes of good practice.

Speaking at the launch of the revised BBBEE codes, Minister Rob Davies said BEE remained an imperative in South Africa.

“It is not just a social or political imperative . . . but an economic imperative as well. Control of companies in the country should be reflective of the demographic and we cannot expect to grow as an economy if business leadership is in the hands of the small minority.”

The current generic scorecard contains seven elements and these have been reduced to five, with a total of 105 points assigned to the five elements. All companies, except the exempted micro enterprises (EMSs) should comply with all the elements of the scorecard.

"There is also some adjustment to the points allocated and the qualification criteria. There is also an enhanced recognition of the status of black-owned micro enterprises,” said Davies.

He said one of the new things being proposed in the revised codes was the introduction of minimum requirements for priority elements. These are ownership, skills development and enterprise and supplier development. Qualifying small enterprises are required to comply with two of the elements, although ownership is compulsory, while large entities will have to comply with all of the requirements.

The thresholds for EMEs and QSEs have also been adjusted, with EMEs increasing from R5-million to R10-million and QSEs increasing from between R5-million and R35-million to R10-milion and R50-million. The Minister explained that inflation was the rationale behind the increases.

All entities would be forced to comply with priority elements under the following conditions: QSEs would need to comply with at least two of the priority elements, which include compulsory black ownership and education for sustainable development or skills development; while large entities would need to comply with all priority elements.

Entities that did not meet the thresholds in these elements would be discounted in BBBEEE levels.

In terms of fronting, Davies said that the bill has also been amended to include much more comprehensive definitions of fronting. “We are also establishing a commissioner who will be responsible for the investigating of these kinds of practices. We are also looking into penalties attached to those kinds of practices.”

Law firm Webber Wentzel stated that the revised codes contained a controversial amendment, which could result in a reduction of companies’ empowerment ratings.

Webber Wentzel partner and BEE expert Safiyya Patel said the most sweeping proposed amendment was likely to be the introduction of sub-minimum targets for the priority elements.

“If the amendments are processed in their current form, companies will be required to achieve a minimum compliance of 40% of the targets for the priority elements.

“If they do not achieve the minimum compliance for any of the priority elements, their overall contributor status will be reduced by two levels if they are large entities or by one level if they are qualifying small enterprises. “

Patel noted that this meant that companies that had until now overlooked any black shareholding requirements and focused on all the other elements of BBBEE would be adversely impacted.

“For example, a large company that may have 7% black ownership, but is a level three contributor, will be automatically reduced to a level five contributor because it does not meet the 10% minimum black ownership target,” she added.

Meanwhile, Davies said that the manufacturing sector, which was seen as critical to the development of the economy, was, by and large, not transformed.

“We certainly want to promote local production. . . but we are not able as government to put targets down and tell private sector to buy from certain local manufacturers.

“However, we have signed a localisation accord with Cosatu, which saw us setting up a 75% procurement target. Very little has happened in this regard, and even our own government designations are behind.

“We need to look at how we can make localisation a tool and once that happens, we need to look at how we can get black-owned companies much more active in this space,” Davies noted.

He pointed out that other countries, particularly in Asia, made use of symbiotic relationships between small and large business. “They have active supplier development as they want to insure inputs come from the small players. These large business also partake in active mentoring, skills development, trading and capacity building.

“This is the sort of model that we need to create and develop in this country. Through incubation programmes, which are running in the country at the moment, larger companies could assist smaller companies to become productive players in the economy,” he said.

Davies announced at the recent International Small Business Congress in Sandton that the DTI had established an incubation support programme for small businesses, which would see 250 incubators set up through the country by 2015.

The programme would encourage private sector partnerships with government to foster collaboration between small and big businesses, whereby big businesses assist small, medium-sized and micro enterprises with skills and technology transfer, supplier development and creating marketing opportunities for small businesses.


 

Edited by: Mariaan Webb
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other Economy News
Updated 2 hours 1 minute ago Creating circular economies is an alternative to a traditional linear economy that could assist government in boosting economic growth and in creating much needed jobs in line with the National Development Plan, says the Recycling and Economic Initiative of South...
LATERAL POTENTIAL High demands on production, quality and hygiene in the food industry necessitate efficient and well-managed systems
Updated 2 hours 1 minute ago Students participating in the 2015 PneuDrive Challenge Engineering Design Competition will need to design “game changers” for the food and beverage industry, says drive engineering company SEW-Eurodrive. This year’s competition roadshows started at the end of last...
DEMAND FLUX The aggregate 20% increase in food consumption for 2050 is likely to comprise protein-based food products and foods with a higher oil and fat content
Updated 2 hours 1 minute ago A significant nutritional transition is taking place in sub-Saharan Africa, with a marked increase in the region’s consumption of higher-value processed foods, says analysis firm B&M Analysts chairperson Professor Justin Barnes. The transition, which increases the...
More
 
 
Latest News
Oger Telecom is looking at the possibility of selling its majority stake in Cell C, South Africa's third-largest mobile telecoms network operator, the chairman of the Middle Eastern firm told Reuters on Thursday. Goldman Sachs has been appointed by Oger Telecom to...
South Africa’s national oil company PetroSA, through its subisidiary PetroSA Ghana, has secured a seven-year $150-million reserve-based lending credit facility with a consortium of banks. PetroSA CFO Lindiwe Bakoro said the company was pleased to close this...
The $200-million ‘loop line 1’ project to expand the capacity of the gas pipeline from Mozambique to South Africa has been completed, the Republic of Mozambique Pipeline Investments Company (Rompco) has confirmed. Rompco is the gas transport joint venture set up in...
More
 
 
Recent Research Reports
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
 
 
 
 
 
This Week's Magazine
Updated 1 hour 49 minutes ago The World Bank, the European Union, the African Development Bank (AfDB) and the government of Sweden have agreed to provide Zimbabwe and Zambia with $294-million for the repair of structural deformations on the Kariba dam wall and avert the possible collapse of the...
Global Electricity Initiative executive chairperson Philippe Joubert
Updated 1 hour 49 minutes ago Executive chairperson of the Global Electricity Initiative (GEI) Philippe Joubert says energy utilities globally, together with the business community more generally, have come to terms with the science of climate change, particularly as extreme weather events begin...
JAMES TEMPLETON Emira’s operational performance is the best it has been in a long time
Updated 1 hour 49 minutes ago JSE-listed Emira Property Fund reported distribution growth per participatory interest (PI) of 9% for the six months ended December 31, 2014.
JOAN MACNAUGHTON Many countries were also struggling to balance the energy trilemma of energy security, energy equity and environmental sustainability
Updated 1 hour 49 minutes ago Sub-Saharan Africa is still faced with the challenge of providing citizens access to electricity and an additional $450-billion will need to be invested to ensure that people in urban areas have access to electricity by 2040.
ABE THELA Cuban engineering skills are not recognised by the Engineering Council of South Africa
Updated 1 hour 49 minutes ago Consulting Engineers South Africa (Cesa) last month said it was dismayed that the Department of Water and Sanitation (DWS) was seconding 35 Cuban engineers on a two-year contract to share their expertise with South African engineers in the water sector.
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks
Subscribe Now for $96 Close
Subscribe Now for $96