BEE RELIEF FOR SMME'S

On the 6th December 2006, Cabinet approved the gazetting of phaze one and two of the Broad-Based Black Economic Empowerment's (BBEEE) Codes of Good Practice. There are substantial changes to the Codes of Good Practice, some of which bring substantial relief to SMME's:

Organisations with a turnover of less than R5 million per annum are to be exempt from complying with BEE and will be deemed to be level 4 contributors – this means that clients spending money for goods and/or services from these small organisations can count 100% of their spend in their respective BEE Scorecard under the Preferential Procurement pillar.

Organisations with a turnover of between R5 – R35 million may now chose 4 out of the 7 pillars when calculating their BEE Scorecard and each of these 4 pillars has a weighting of 25 points. Just as a reminder, the 7 pillars of BEE fare: Ownership, Management, Employment Equity, Preferential Procurement, Skills Development, Enterprise Development and Corporate Social Responsibility. In essence the amendments to the Codes mean that small organisations do not have to have black ownership or management to obtain a strong BEE rating.

Organisations with a turnover of over R35 million need utilise the Generic BEE Scorecard which consists of all 7 pillars mentioned above.