B-BBEE Bill Passed – EconoBEE Newsletter – 1 July 2013

EconoBEE - BEE Points = Business
B-BBEE Bill Passed

The B-BBEE Amendment Bill has been passed in parliament. It now goes to the Council of Provinces before the President signs it into law.

As with any new legislation, it must be tested in a court of law, but there are aspects of the bill that we need to make you aware of.The bill provides penalties for fronting: up to 10 years in jail and 10% of a company’s turnover.

Fronting is defined as:
‘fronting practice’ means a transaction, arrangement or other act or conduct that directly or indirectly undermines or frustrates the achievement of the objectives of this Act or the implementation of any of the provisions of this Act, including but not limited to practices in connection with a B-BBEE initiative—
(a) in terms of which black persons who are appointed to an enterprise are discouraged or inhibited from substantially participating in the core activities of that enterprise;
(b) in terms of which the economic benefits received as a result of the broad-based black economic empowerment status of an enterprise do not flow to black people in the ratio specified in the relevant legal documentation;
(c) involving the conclusion of a legal relationship with a black person for the purpose of that enterprise achieving a certain level of broad-based black economic empowerment compliance without granting that black person the economic benefits that would reasonably be expected to be associated with the status or position held by that black person; or
(d) involving the conclusion of an agreement with another enterprise in order to achieve or enhance broad-based black economic empowerment status in circumstances in which—
(i) there are significant limitations, whether implicit or explicit, on the identity of suppliers, service providers, clients or customers;
(ii) the maintenance of business operations is reasonably considered to be improbable, having regard to the resources
(iii) the terms and conditions were not negotiated at arm’s length and on a fair and reasonable basis;

‘knowing’, ‘knowingly’ or ‘knows’, when used with respect to a person, and in relation to a particular matter, means that the person either—
(a) had actual knowledge of that matter; or
(b) was in a position in which the person reasonably ought to have—
(i) had actual knowledge;
(ii) investigated the matter to an extent that would have provided
the person with actual knowledge; or
(iii) taken other measures which, if taken, would reasonably be
expected to have provided the person with actual knowledge of
the matter;’’;

This follows the general principle that “ignorance of the law is no excuse”. A CEO cannot use as an excuse that his consultant, PA, HR expert, verification agency did the work and he does not understand the issues involved. If a BEE certificate comes out of a company, the bill recognises that this is an important document that the CEO “ought” to have seen and been aware of. The recent situation where the financial director of a JSE listed company issued a falsified BEE certificate, and stated that he was too busy to check it, and did not even realise that the company had no certificate, could in future result in up to 10 years in jail.

The only solution is to be better briefed on BEE principles – to understand what the certificate means. We always like to visit clients once their certificate has been issued to explain what the certificate means so they cannot make a mistake even an innocent one. If they are in a position where the “ought” to have specific knowledge, courts will probably have no sympathy for them.


BEE Bill vs Revised Codes and preparing for verification

Confusion reigns at the moment. Is the BEE Bill the same as the revised codes that were proposed last year? The simple answer is no.

The BEE bill is effectively a new act. The act’s main objective is to increase the effectiveness of B-BBEE. The revised codes is the actual scorecard that businesses need to follow.

Gain more insight into the B-BBEE Amendment Bill, revised codes to ensure that your business is 100% ready for its next BEE verification. Book now for our full day conference on how best to prepare for verification taking into account all legislation and interpretations.

Good Preparation for verification is the major contributing factor to earning a successful score. EconoBEE’s Prepare for Verification and Future Proof your BEE Activies conference aims to make the BEE verification process less stressful by showing you all of the tips and tricks to earn maximum points.

Date:29 August 2013 – JHB – Gallagher Estate
September 2013 – CPT – TBA
September 2013 – DBN – TBA
Time:8:30 for 9:00 – 17:00
Price:R3500 excl VAT (R3990 incl VAT)
Booking Details:Email info@econobee.co.za
Contact 011 483 1190
Early bird special – EconoBEE V3 worth R3500 if booked and paid for early.
Book online or download our brochure.



Let our consultants save you time on B-BBEE.

Preferential Procurement – Save Time by using the BEE Procured database containing over 30 000 BEE Certificates.
Procurement Managed Service: Our consultants can phone your suppliers for a BEE certificate – Managed Service.



Twitter - EconoBEEFacebook - EconoBEELinkdin - EconoBEEYouTube - EconoBEEEconoBEE Blog

While there is demand for a B-BBEE Scorecard someone will be taking advantage, shouldn’t that someone be you…


Want us to manage your BEE Process – Managed Service.

Turnover below R5 million – find out how to get your BEE Exemption.

Is BEE procurement a pain? Sort it out quick and easy – BEE Procured.

Need a scorecard – produce one yourself – EconoBEE V3.

EconoBEE Newsletter
  01 July 2013

In this issue

  • B-BBEE Bill Passed
  • BEE Bill vs Revised Codes and preparing for verification

In other news

About EconoBEE


EconoBEE is an expert BEE consultancy. EconoBEE helps businesses Become BEE Compliant, prepare for verification, earn maximum BEE Points and ensure that they achieve the BEE Level they need to get more business.

Our services include BEE Management Systems, Training, EME Pack, Complete Managed Services; consulting and advisory and Procurement Solutions.

As leaders in the industry we are driven to help maintain and develop knowledge in the BEE industry.

Already have a BEE Certificate?

Please send it to us and we will include it in our BEE Procured database.

Contact Us

Tel: 011 483 1190
Fax: 011 483 1195
Email: info@econobee.co.za
Web: www.econobee.co.za

Follow us

We know how useful our newsletters are but you needn’t wait for our newsletters – follow us on Twitter, connect with us on Facebook or stay well informed by reading our BEE Blog.

Forward to a friend

Know someone who might be interested in this email? Why not forward this email to them using [forward].

BEE Points = Happy Customers = Sustainable Business

Gavin and the EconoBEE Team

Executive summary of B-BBEE

Turnover below R5 million per annum – automatic BEE status


Turnover above R5 million per annum – you need a BEE Scorecard. Our workshops, scorecard tools, procurement manager or a complete managed services will be best for you.


Your time on your business, our time on your BEE status


Through our managed service avoid the BEE distraction and let our consultants implement Broad-Based Black Economic Empowerment for you.


10 Strategic Steps to B-BBEE!

We have prepared an easy to follow guide “B-BBEE in 5 Minutes” and “Crash Course to BEE Verification” which explains BEE in a simple step by step approach.

HomeCorporate ProfileBecome BEE CompliantEconoBEE ServicesBEE ResourcesContact

Copyright EconoBEE – Helping you and the Economy Grow . All Rights Reserved.

You may also like...