The Department of Trade and Industry confirmed the extension of the transitional period for the Amended Codes of Good Practice for Broad-Based Black Economic Empowerment by a 6 month period. The amended Codes will now become effective from 30 April 2015.
This will have the following implications for business:
1. Many companies had decided to either bring their verification forward so certificates were issued before 11 October 2014, or were having second verifications performed before that date. These verifications can now be delayed until March or April 2015. We will contact companies with confirmed dates before October 2014 to move these dates closer to April 2015. The amended codes are significantly more rigorous than the old codes and I recommend performing a second verification, or bringing a verification forward to take advantage of this extended transition period.
2. There will be additional time to plan the implementation of the new codes. There is a lot of work to be done to ensure that systems are in place to maximise points using the amended codes. If you want a quote for a strategic planning session please feel free to call me.
3. The delay will also give the Department of Trade and Industry time to clarify certain interpretation issues, review formulae which do not give the desired results (such as the formula under Management Control), issue the anticipated QSE scorecard and Technical Guide, and deal with the question of ownership in multinational corporations.
4. Sector councils will have an additional 6 months to align the sector codes with the amended codes.
5. QSE which are greater than 51% black owned and all EME can take advantage of certain beneficial terms under the amended codes and can adopt the new codes early. Such businesses only need to obtain an affidavit stating their turnover and black ownership. This affidavit will serve as their B-BBEE certificate. Remember EME’s are now businesses with turnover less than R10 million and QSE’s are those entities with revenues between R10 and R50 million.
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