Issue Date: 
Tuesday, September 6, 2016

New Requirements for Construction Industry B-BBEE

The final draft for gazetting of the Amended Construction Sector B-BBEE Codes has been released. There are various interesting changes that will impact heavily on company’s B-BBEE strategies going forward.

There are very interesting changes and amendments with regards to Exempt Micro Enterprises. According to Section 4 of the Final draft Codes any enterprise with a total annual Revenue of R10 million or less if it is a Contractor or R6 million or less if it is a BEP qualifies as an Exempted Micro-Enterprise. This is still more or less in line with the Generic B-BBEE Codes of Code Practice.

The big changes come in Section 4.2 where an Exempt Micro Enterprise is deemed to have the following B-BBEE status Level:

  • If less than 30% Black Owned then “Level Five Contributor” having a B-BBEE recognition level of 80% under paragraph 8.3 of the new Codes;
  • If 30% Black Owned then “Level Four Contributor” having a B-BBEE recognition level of 100% under paragraph 8.3 of the new Codes;
  • If 51% Black Owned then “Level Two Contributor” having a B-BBEE recognition level of 125% under paragraph 8.3 of the new Codes;
  • If 100% Black Owned then “Level One Contributor” having a B-BBEE recognition level of 135% under paragraph 8.3 of the new Codes;

The best part of the Amended Construction Sector Codes is the Enhanced B-BBEE Status Level for an Exempted Micro-Enterprises whereby despite paragraphs 4.2, an Exempt Micro Enterprise is allowed, should they so wish, to maximise their points and move to a higher B-BBEE recognition level by one of the following three means:

  • Obtain measurement in terms of the QSE Scorecard as a whole and apply the B-BBEE Status Level and B-BBEE Recognition Level so determined; or
  • Obtain measurement in terms of the Skills Development expenditure category in paragraph 1.1 of Statement CSC603 of the QSE Scorecard, and only if full points are achieved for this category the B-BBEE Status Level and corresponding B-BBEE Recognition Level of the Exempt Micro Enterprise will be enhanced by one level.
  • Obtain measurement in terms of the Supplier Development Expenditure category of the QSE Scorecard (paragraph 2.1 of Statement CSC604) only, and only if full points are achieved for this category the B-BBEE Status Level and corresponding B-BBEE Recognition Level of the Exempt Micro Enterprise will be enhanced by one level.

All of the above is great news for Exempt Micro Enterprises. They can now increase there B-BBEE status levels which was not the case in the Old Codes.

To learn more about this and many other tender conditions please attend one of our How-to-Tender workshops. Tender Workshop dates are published on our website at www.how2tender.com.

Learn to earn

Article by Werner van

www.how2tender.com

Brand new Preferential Procurement Regulations 2017 for Tenders

The brand new Preferential Procurement Regulations 2017, has been finalized and was gazetted on 20 January 2017. There are some interesting changes and challenges that we will discuss during the coming months. This is the official media release from National Treasury:

The regulations were initially promulgated in 2001 and revised in 2011 thus making this the second revision since the initial promulgation.

The revision of the Preferential Procurement Regulations of 2011 was largely influenced by the need... Read More

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