SERR SYNERGY

THE BEE REALITY

Broad-Based Black Economic Empowerment (B-BBEE or BEE) is a reality and a business imperative.

With the implementation of the amended BEE Codes, BEE has entered a new phase of diversity, requirements, dimensions and facets and is not limited to ownership and management considerations as some individuals may believe.

Companies that have failed until now to react need to do so very soon or face the gloomy prospect of not being in business within a relatively short period of time.

DO YOU KNOW YOUR A-Z OF BEE LEGISLATION?

You don’t have to become a BEE expert. The challenge in understanding the complexity of the how, who, when and what of BEE is the main cause of concern and perceived risk for many owners of large corporates, family businesses, small and medium-sized businesses and professional practitioners.

We at SERR SYNERGY are proud of our qualified team of legal professionals and their collective expertise and skills that will ensure that your business is aligned to BEE legislation and best practice while you focus on your core business. Being one of the most significant pieces of legislation impacting South African businesses today, we understand that companies need to take transformation far more seriously and do more to implement unique BEE strategies in their businesses. As industry leaders our variety of ownership solutions differentiates us from the rest.

THE AMENDED CODES OF GOOD PRACTICE

The amended Codes of Good Practice are far reaching and BEE impacts, in one form or another, almost every participant in the South African economy. More than 84% of all registered businesses in South Africa are family businesses. The emphasis in the amended Codes on ownership, particularly the 51% black ownership criteria, has a significant influence on the future competitiveness of family businesses in South Africa.

THE CURRENT BEE ELEMENTS

Ownership: measures black ownership of the entity.

Management: measures participation of black people in the Board and management control structure.

Skills Development: measures skills development spend on black employees and unemployed individuals, as well learnerships, apprenticeships/ internships and SETA-accredited training programmes.

Enterprise and Supplier Development: measures procurement spend from empowering suppliers, together with Supplier Development and Enterprise Development contributions to beneficiary entities that are at least 51% black owned, in respect of their development, sustainability, financial and operational liberation.

Socio-Economic Development: measures contributions for socio- economic development.

*Please note that these comprised seven elements on the old BEE scorecard. In the amended Codes there is greater emphasis on majority black ownership, particularly in relation to the sub-element of Procurement as well as Enterprise and Supplier Development. There is a retrospective shift in direction towards ownership, which now comprises 57% of the scorecard points.

IMPACT ON BUSINESS CATEGORIES

The amended Codes of Good Practice are far reaching and BEE impacts, in one form or another, almost every participant in the South African economy.

EXEMPT MICRO ENTERPRISES (EME)

An entity with an annual turnover of R10 million or below automatically achieves a Level 4 (100%) contributor status. Enhanced recognition of Level 1 (135%) if 100% black owned or Level 2 (125%) if 51% or more black owned.

QUALIFYING SMALL ENTERPRISE (QSE)

An entity with an annual turnover of between R10 and R50 million will need to score on all 5 elements. Enhanced recognition of Level 1 (135%) if 100% black owned or Level 2 (125%) if 51% or more black owned.

GENERIC ENTERPRISES

An entity with an annual turnover of above R50 million will be scored on all 5 elements.

* Please note: The above turnover limits are only applicable to general sector codes. Your SERR SYNERGY consultant will discuss turnover cut-off points for your relevant industry sector code.

WHY CHOOSE SERR SYNERGY AS YOUR BEE SERVICE PROVIDER?

Our leadership team has been involved with B-BEEE in South Africa since 2004.

Our comprehensive BEE services include tailor-made solutions that meet existing BEE challenges by implementing effective and value-adding strategies.

We follow a systematic approach to BEE to ensure effective implementation and to derive the desired outcomes.

51% Shareholding by the BEE programme Existing shareholders

49% Working of a collective ownership programme

MEMORANDUM OF INCORPORATION

Comply with new Companies Act
Make provision for specific instances or special resolutions
Cater for outside

SHAREHOLDERS AGREEMENT

Economic interest
Voting rights
Pre-emptive rights
Future sale of shares
Capital requirement of the business

CONSTITUTION OF PROGRAMME

Names trustees / fiduciaries
Name beneficiaries
Determine benefits
Provide for participation

OUR VALUE-ADDING BEE SERVICE

All services and legal work relating to the implementation of your customised BEE strategy are included in our fees.

The following is included:

Facilitate the issuing of an accredited BEE verification certificate by an accredited verification agent.

Developing of strategies and compiling of a strategic report and GAP analysis to enhance BEE levels.

Setting up BEE ownership structures i.e. collective programmes, employee- or broad- based programmes, community beneficiaries, programmes etc.

All agreements relating to such structures, i.e. shareholder agreements, subscription agreements, share option agreements, etc.

All BEE joint venture, partnership and association agreements.

All amendments in this regard as required by the Companies and Intellectual Property Commission of South Africa (CIPC).

All resolutions and special resolutions to give effect to the above.

Access to unique Empowerment Development structures for purposes of Enterprise, Supplier and Social Development.

Continuous professional consultation and advice.

Legal representation at the BEE Commission in respect of any dispute or inquiry relating to any BEE aspect emerging as a result of work done by SERR

SYNERGY as per your contractual agreement and conditions.