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

Codes of Good Practice on Black Economic Empowerment

Integrated Transport Sector Codes

B-BBEE Sub-Sector Code for Public Sector - Transport

3. State Owned Enterprises

3.2 Indicators of Empowerment

3.2.1 Ownership

Purchase

(See footnote under the score card)

3.2.1.1

The ownership element comprises of the following criteria and targets:

3.2.1.1.1

Exercisable voting rights in the hands of black people, for which the target is 25%+ 1 vote.

3.2.1.1.2

Exercisable voting rights in the hands of black women, for which the target will be 10%.

3.2.1.1.3

Economic interest in the hands of black people, for which the target is 25% of the economic interest accruing to black people.

3.2.1.1.4

Economic interest in the hands of black women, for which the target is 10% of the economic interest accruing to black women.

3.2.1.1.5

Economic interest in the hands of black designated groups, for which the target is 3%.

3.2.1.2

Guidelines for selection in the case of a sale of an SOE or a Productive State Asset

3.2.1.2.1

According to the Broad-Based Black Economic Empowerment Act (2003), the B-BBEE Codes of Good Practice must be applied when determining qualification criteria for the sale of state-owned enterprises. In line with this stipulation, SOEs will be allocated according to the acquiring company's B-BBEE status as determined by the acquiring company's sector charter. In the absence of a sector charter, the B-BBEE Generic Codes of Good Practice shall be applied.

3.2.1.2.2

The ownership requirements stipulated above and contained in the scorecard below will be used in the evaluation of the bidders' ownership status and the appropriate sector Sub-Sector Code where applicable.

3.2.1.3

The Ownership B-BBEE Scorecard of public sector agencies and regulators that report to the DOT will have the following indicators:

3.2.1.3.1

The percentage of economic interest and exercisable voting rights in the hands of black people.

3.2.1.3.2

The percentage of economic interest and exercisable voting rights in the hands of black women.

3.2.1.3.3

The percentage of economic interest and exercisable voting rights in the hands of black designated groups.

3.2.1.3.4

Net Economic Interest held by black shareholders. This is the portion of equity in the hands of black shareholders that is fully paid up. Essentially it is the value of the shareholding, less the outstanding amounts owed by that shareholder to third party funders or the principle entity in which the stake was acquired.

3.2.1.3.5

Ownership fulfilment (This occurs when black shareholders are free from all financial obligations relating to their share acquisition and own 100% of their stake in the enterprise.)

3.2.1.4

Measurement Principles and Application of the Charter

3.2.1.4.1

Measurement principles associated with the ownership element are contained in Statement 100 of Code 100 of the B-BBEE Generic Codes of Good Practice.

3.2.1.4.2

The formulae required in the determination of the ownership score is contained in Annexure 100 (c) of Statement 100 of Code 100 of the B-BBEE Generic Codes of Good Practice.

3.2.1.4.3

The recognition of the sale of assets under the ownership element has the same meaning as that contained in Statement 102 of Code 100 of the B-BBEE Generic Codes of Good Practice. The target contained in the ownership element of this Sub-Sector Code will apply.

3.2.1.4.4

The recognition of the equity equivalent programmes for multinationals has the same meaning and interpretation as that contained in Statement 103 of Code 100 of the B-BBEE Generic Codes of Good Practice.

3.2.1.4.5

The formulae required in the determination of the ownership score based on equity equivalent contributions are contained in Annexure 103 (A) of Statement 103 of Code 100 of the B-BBEE Generic Codes of Good Practice.