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

Industry Charters

Information and Communication Technology (ICT) Charter

ICT Sector Code for Black Economic Empowerment

Code Series 500: Measurement of the Preferential Procurement Element of Broad-Based Black Economic Empowerment

Statement 500: The General Principles for Measuring Preferential Procurement

5. Total Measured Procurement Spend

Purchase

The following procurement is measurable within Total Measured Procurement Spend:

5.1	Cost of sales: all goods and services procured that comprise the cost of the sales of the Measured Entity;

5.2	Operational expenditure: all goods and services procured that comprise the operational expenditure of the Measured Entity;

5.3	Capital expenditure: all capital expenditure incurred by the Measured Entity;

5.4	Public sector procurement: all goods and services procured from organs of state and public entities listed in Schedules 2 and 3 to the Public Finance Management Act of 1998;

5.5	Monopolistic procurement: all goods and services procured from suppliers that enjoy a monopolistic position;

5.6	Third-party procurement: all procurement for a third-party or a client, where the cost of that procurement is an expense recorded in the Measured Entity's annual financial statements;

5.7	Labour brokers and independent contractors: any procurement of the Measured Entity which is Outsourced Labour Expenditure;

5.8

Pension and medical aid contributions: payments made to any post retirement funding scheme or to a medical aid or similar medical insurer by a Measured Entity for its employees, excluding any portions of such payments which are a contribution to a capital investment of the employee. The scheme or insurer must issue a certificate dividing payments between the capital investment portion and the balance to establish the amount that is measurable within Total Measured Procurement Spend;

5.9	Trade commissions: any commissions or similar payments payable by a Measured Entity to any other person pursuant to the business or trade of the Measured Entity;

5.10	Empowerment related expenditure: all goods and services procured in carrying out B-BBEE. The Total Measured Procurement Spend does not include the actual contribution portion recognised under Code series 600 or 700 but does include any expenditure incurred in facilitating those contributions;

5.11	Imports: all goods and services that are imported or procured from a non-South African source; and

5.12	Intra-group procurement: except as provided in statement 002, all goods and services procured from subsidiaries or holding companies of the Measured Entity.