New BEE Codes Summary
The proposed amendments to the BEE codes were first published for comment on 5 October, 2012. On 11 October, 2013, the Department of Trade and Industry gazetted the revised codes thus bringing them into law. The DTI has granted a 12 month transitional period until 11 October, 2014, by which time all entities have to comply with the new BEE codes.
Download the Revised BEE Codes of Good Practice (1.8MB)
The New Generic Scorecard
The new BEE codes have been reduced from seven elements to five. The new generic scorecard for the revised codes is shown below:
|Code Series||Element||Weighting||Bonus Points||Total|
|100||Ownership||25 points||0 points||25 points|
|200||Management Control||15 points||4 points||19 points|
|300||Skills Development||20 points||5 points||25 points|
|400||Enterprise and Supplier Development||40 points||4 points||44 points|
|500||Socio-Economic Development||5 points||0 points||5 points|
|Totals||105 points||13 points||118 points|
- Employment Equity has been consolidated with Management Control.
- Preferential Procurement and Enterprise Development have merged to form Enterprise and Supplier Development.
- The new threshold for Exempted Micro Enterprises (EMEs) has been raised from an annual turnover of R5million to R10million.
- The new threshold for Qualifying Small Enterprises (QSEs) has been raised from an annual turnover of R5million – R35million to R10million – R50million.
The revised codes defines three of the five elements as priority elements. These are:
- Skills Development;
- Enterprise and Supplier Development.
All entitities are required to comply with only the minimum threshold requirements (40%) for the priority elements. QSEs are required to comply with only the Ownership and either of Skills Development or Enterprise and Supplier Development elements. If an entity does not achieve all three targets(or two for QSEs), the entity is penalised by dropping one level on its scorecard. To avoid being penalised one level the minimum thresholds per priority element are:
- Ownership minimum requirement – 40% holding of net value by black sharehlders;
- Skills Development – 8 out of 20 points;
- Enterprise and Supplier Development – 16 out of 40 points.
New B-BBEE Recognition Levels
|B-BBEE Status||Qualification - New Scorecard||Recognition Level||Qualification - Old Scorecard|
|Level 1 Contributor||≥100||135%||≥100|
|Level 2 Contributor||≥95 but <100||125%||≥85 but <100|
|Level 3 Contributor||≥90 but <95||110%||≥75 but <85|
|Level 4 Contributor||≥80 but <90||100%||≥65 but <75|
|Level 5 Contributor||≥75 but <80||80%||≥55 but <65|
|Level 6 Contributor||≥70 but <75||60%||≥45 but <55|
|Level 7 Contributor||≥55 but <70||50%||≥40 but <45|
|Level 8 Contributor||≥40 but <55||10%||≥30 but <40|
The new recognition levels are somewhat more difficult to achieve than those under the old generic scorecard. If you are currently a level 2 contributor with 85 points, under the new BEE codes you will only be a level 4 contributor.
Throughout the new BEE codes various criteria appear which advance the interests of certain categories of Black people.
- All businesses with an annual turnover of less than R10million (EMEs) are exempt from BEE. An EME is automatically granted a level 4 B-BBEE status;
- EMEs with a 100% black ownership are granted a level 1 B-BBEE status;
- QSEs with a 100% black ownership are automatically granted a level 1 B-BBEE status;
- QSEs with a minimum 51% black ownership are automatically granted a level 2 B-BBEE status.