Broad Based Black Economic Empowerment

Companies setting up in South Africa need to be aware of BBBEE, the legislation involved in rectifying inequality issues, and how to operate a business that complies with these laws.

Broad-Based Black Economic Empowerment (bbBEE), often referred to simply as ‘BEE’, is a key element to doing business in South Africa. It is the cornerstone of the South African Government’s efforts to educate and train the huge sector of the population that was disadvantaged under apartheid. It aims to accelerate the participation of black people (South African citizens who are African, Coloured and Indian) in the economy.

bbBEE intends to achieve this by encouraging change in seven key areas of business: ownership; management control; employment equity; skills development; preferential procurement; enterprise development; and corporate social investment.

bbBEE compliance is not legally binding on private companies in South Africa. However, the government uses a number of mechanisms through which adherence to the codes is strongly encouraged. The bbBEE codes are binding on all government bodies and State Owned Enterprises and as a result these institutions have to procure from companies that comply with the requirements of this legislation. This cascades down through the economy, as government’s first tier suppliers require their own suppliers to be compliant so that they can achieve/maintain their own bbBEE status.

B-BBEE Strategy Document

This document outlines the South African Government’s 10-year B-BBEE plan. It describes the various policies, reasoning behind B-BBEE and means of implementing B-BBEE policies. The document has been produced by the DTI and is available on its website www.thedti.gov.za.

You can contact the South African National Department of Trade & Industry (The DTI) - BEE Unit for more information:

Tel: +27 (0)12 394 9500

Email: www.thedti.gov.za/bee/beehome

Contacts

If you are looking to develop your business in South Africa please ensure you are compliant with South Africa’s policies relating to BBBEE. For more information please contact:

Andy Wooldridge

UKTI South Africa

Email: satrade@fco.gov.uk