This Gazette, which issued amendments to Code Series 000 (General), 300 (Skills Development), 400 (Enterprise & Supplier Development), and Schedule 1 (Definitions), came into effect upon the date of publication. A six-month transition period is allowed for implementation. Hence, until and including 30th November 2019, an organisation measured against the Generic Codes can elect to be measured against the 2013 provisions held in Gazette #36928. Notwithstanding, an organisation may elect to be measured against the amended provisions immediately, but only before 1st December 2019. Should an organisation elect to be measured on the amendments of this Gazette, all the amendments in the Gazette are applicable.
Either on or following 1st December 2019, evidence of an organisation’s Status Level, whether in the form of a SANAS accredited B-BBEE Certificate, an Affidavit, or a CIPC Certificate, must be measured against the 2019 amended provisions of Gazette #42496. This deadline is non-negotiable. Gazette #36928 will be repealed on 1st December 2019. Consequently, following the repeal, all relevant amendments apply to the Amended Generic Codes; therefore all organisations, irrespective of their threshold, are bound by it.
However, organisations measured on a Sector Code issued in terms of Section 9(1) of the B-BBEE Act as amended, are measured according to the requirements of that particular Sector Code. Therefore, organisations measured on a Sector Code will not be affected by these amendments.
Nevertheless, where matters are silent in the Sector Codes, the amended provisions of Gazette #42496 are applicable.
The Sector Councils are, however, are now required to align their sector-specific Codes to the dti’s Amended Codes of Good Practice, and a transitional period of twelve points from 1 June 2019 to 30 May 2020 has been allocated for this process, encouraged to initiate an alignment process to integrate these amendments into their specific Sector Code. On the 18th of September 2019, the Tourism B-BBEE Charter Council published their draft amendments in Gazette 42725 and invited all interested and affected persons and organisations to participate in the alignment by submitting comments and inputs in writing by no later than 30 November 2019 to the Tourism B-BBEE Charter Council.
Statement 000: General Principles – The Generic Scorecard Notice 306 of 2019
- Compliance with Priority Element clearly states that Sub-minimum Requirements are only applicable when Bonus Points are excluded as outlined below:
- Skills Development – 40% of the 20 points available
- Preferential Procurement – 40% of the 25 points available
- Supplier Development – 40% of the 10 points available
- Enterprise Development – 40% of the 5 points available
- Organisations that are 51% or 100% ‘Black’-owned QSEs that benefit from Enhanced Recognition only need to comply with Ownership as a Priority Element (paragraph 22.214.171.124).
- The Discounting Principle applies to QSEs that do not comply with the Sub-minimum Requirements. Organisations that are 51% or 100% ‘Black’-owned EMEs or QSEs can achieve Enhanced Recognition using the Flow-Through Principle. This indicates that the Modified Flow-Through Principle does not apply in this instance.
- The Joint Venture calculation applies to organisations with a Status Level 1, 2 or 4. Points are outlined as follows:
- Level 1-100% ‘Black’-owned = 100 points;
- Level 2-51% ‘Black’-owned = 95 points; and
- Level 4 = 85 points.
This calculation is applicable across all Sector Codes except the Construction Sector Code, which has its own Joint Venture calculation.
Statement 300: The General Principles for Measuring Skills Development – Notice 305 of 2019
The Skills Development Generic Scorecard has been amended as follows:
- The total points, excluding Bonus Points, remain unchanged. The only adjustments were for the provision of bursaries, as well as the combination of Employed and Unemployed Learnerships, Apprenticeships and Internships.
- The EAP calculation remains unchanged and applies to bursaries.
- Skills Development expenditure on bursaries under 126.96.36.199 must not be counted under the Skills Development Indicator 188.8.131.52 and vice versa.
- The Category F&G Learning programs’ cap increased from 15% to 25%; however, training costs such as travel, accommodation and catering remain at 15%.
- In terms of bursaries, there is no cap on training costs such as travel, accommodation or catering.
- Salaries and wages for Learnerships, Apprenticeships and Internships claimed under Skills Development Expenditure includes stipends paid to ‘Black’ Bursary Students. However, it is vital to note that there can be a stipend for employees, but wages or salaries are excluded.
- The category A Bursaries are defined as ‘Black’ Students registered at educational institutions established by, or registered with, the Department of Basic Education or the Department of Higher Education and Training.
One could assume that adding Bursaries to the Skills Development Element is a way to address ‘fees must fall’ through the private sector to alleviate the potential financial burden on the economy.
Statement 400: The General Principles for Measuring Enterprise and Supplier Development – Notice 304 of 2019
The Enterprise and Supplier Development Scorecard has been amended as follows:
Schedule 1: Interpretation & Definitions – Notice 303 of 2019
The expectations of the Codes of Good Practice must be interpreted according to the provisions in the Codes. Any reasonable interpretation consistent with the objectives of the Act and the Regulations thereof must take precedence. The words importing persons shall mean, where the context so requires or admits, individuals, firms, partnerships, trusts, corporations, government bodies, authorities, agencies, unincorporated bodies of persons or associations, and any organisation having legal capacity.
Definition amendments in Schedule 1 are outlined hereunder:
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