B-BBEE Sector Charters
In February 2007, the dti gazetted the Black Economic Empowerment (BEE) Codes of Good Practice, in terms of which a number of Transformation Sector Charters (also referred to as Sector Charters) were introduced, vetted and analysed for compliance, as per the stipulations of either Section 9 or 12 of the B-BBEE Act, No. 53 of 2003.
The responsibility of the dti is to ensure that Sector Charters submitted for gazetting are sufficiently aligned to the B-BBEE Act and Codes of Good Practice and more importantly, that they advance the objectives of sustainable B-BBEE.
A B-BBEE Sector Charter, gazetted in terms of Section 12 of the B-BBEE Act, means that it:
Has been developed and agreed upon by major stakeholders in the industry;
Is published for information purposes only and used as a statement of intent by industry players; and
Is fully binding between and among businesses operating in the industry.
NB: A Sector Charter gazetted in terms of Section 12 has no bearing on state organs and departments.
A B-BBEE Sector Charter, gazetted in terms of Section 9(5) of the B-BBEE Act, means that it:
Is a Draft Sector Code, which has complied with the provisions of Section 12 of the B-BBEE Act, in that major stakeholders have agreed to the stipulations of the Charter; and
Is a Draft Sector Code, which has been published nationally for public comment and input, for a period of sixty (60) days.
A B-BBEE Draft Sector Code, gazetted in terms of Section 9(1) of the B-BBEE Act, means that it:
Becomes a Sector Code of Good Practice (Sector Code) and shares the same status as the B-BBEE Codes of Good Practice, published by the Minister of Trade and Industry, in February 2007; and
Is fully binding between and among businesses operating in the industry.
Statement of Clarification – Effective Date of Sector Codes
The purpose of this statement is to clarify the date when a Measured Entity that falls within the scope of a particular Section 9(1) Sector Code must be measured or verified on the basis of the Sector Code and no longer on the basis of the B-BBEE Codes of Good Practice (“the dti Codes”). View Statement
Definitions of Concepts
||Any reference to ‘the Act’ means the B-BBEE Act
||Section 12 of the Act refers to the gazetting of Transformation Charters. These are also referred to as Sector Charters, developed by major stakeholders in the relevant industries, and seek to achieve broad-based transformation.
||These are the same as Transformation Charters, and are developed by major stakeholders in the relevant industries. They are referred to as Sector Charters for as long as they are gazetted under Section 12 of the Act.
|Draft Sector Codes
||These refer to Sector Charters that have been submitted to the dti for gazetting in terms of Section 9(5) of the Act.
|Sector Codes of Good Practice (Sector Codes)
||These refer to the Draft Sector Charters that have been gazetted in terms of Section 9(1) of the Act.
||These refer to the Codes of Good Practice that were gazetted in February 2007, in terms of the Act.
Sector Codes gazetted under Section 9(1):
||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.
|Download Government Gazette No. 36035 here
|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.
- 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.
|Download Government Gazette No. 35914 here
|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.
- 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.
|Download Government Gazette No. 40407 here
|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.
|Download Government Gazette 35400
|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.
|Download Government Gazette 34267
|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. 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.
|Download Government Gazette 32511 here
|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.
|Download Government Gazette 32320 here:
Part 1(Pages 1-24) [Part 2(Pages 25-36)
|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 2018. 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.
- 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.
|Download Government Gazette No. 39887 here
|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.
- The following thresholds will apply to the tourism sector: Exempted Micro Enterprise which is an enterprise that makes a total revenue of less than R 5 Million per annum (R 10 million in the Generic Codes), Qualifying Small Enterprise is an enterprise which makes a total revenue of between R 5 Million and R 45 Million per annum (between R 10 – R50 million in the Generic Codes), whilst a Large Enterprise in the tourism sector is an enterprise which makes a total revenue of over R 45 Million per annum (above R 50 million in the Generic Codes). 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.
|Download Government Gazette 39430 here
Enquiries regarding the above can be directed to:
Tel.: +27 12 394 3430
Fax: +27 12 394 4430