Broad-Based Black Economic Empowerment Act, 2003 (Act No. 53 of 2003)

Codes of Good Practice on Black Economic Empowerment

Integrated Transport Sector Codes

Maritime Transport & Services Industry Sub-Sector Code for B-BBEE

3. Indicators of Empowerment

3.2 Ownership

3.2.2 Foreign Ownership

Purchase

3.2.2.1

Foreign companies, which have an asset base in South Africa, will implement B-BBEE strategies in accordance with the guidelines provided by this Charter. They will be encouraged to sell equity in their local operations.

3.2.2.2

The standard ownership target and measurement methods outlined below will apply as long as there is non-existence of the global practice that disallows the sale of equity to local investors. If such a global policy can be evidenced, the company that holds the asset will be encouraged to contribute to ownership by making an application to the DTI for the implementation of an Equity Equivalent Programme.

3.2.2.3

Multinationals should give the necessary attention to the creation and development of black owned and controlled enterprises within the MT&SI. The beneficiary enterprises of such programmes should have black people having more than 50% of economic interest and voting rights and/or black women having more than 30% of the economic interest and voting rights.

3.2.2.4

Other programmes that can be supported through the Equity Equivalent programmes are such that they are supportive of the following programmes:

3.2.2.4.1

The Accelerated and Shared Growth Initiative of South Africa (ASGISA);

3.2.2.4.2

The Joint Initiative for Priority Skills (JIPSA): and

3.2.2.4.3

The National Skills Development Strategy (NSDS).

3.2.2.5

Equity Equivalent Programmes may also take the form of socio-economic development initiatives, particularly with reference to companies that have ownership structures where more than 50% of the economic interest and exercisable voting rights in the hands of black people, and/or more than 30% of the economic interest and exercisable voting rights are in the hands of black black-women. Or black people who are rural-dwellers, youth, unemployed or disabled own more than 50% of the economic interest and exercisable voting rights.

3.2.2.6

Companies that choose to include enterprise development or socio-economic development initiatives as Equity Equivalent Programmes will not be able to earn points for those initiatives under any other element on the B-BBEE Scorecard of the Sub-Sector Code.

3.2.2.7

The value of the contributions, measured against the value of the domestic asset or South African operations, using a standard valuation method, will be used to calculate the equivalency percentage and this will be applied to the stated targets for ownership in order to score points for ownership.

3.2.2.8

Ownership fulfilment will occur once the black equity participants are free from any third party financial obligations relating to the share acquisition as well as any financial obligations to the principle entity.