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

Industry Charters

Financial Services  Charter

Code Series FS100: Measurement of the Ownership Element of Broad-Based Black Economic Empowerment

Statement 103: The Recognition of Equity Equivalents

3. Recognition of Equity Equivalent Programmes

 

3.1 Any Equity Equivalent Programme forming part of this Sector Code constitutes an approved programme. Specifically, the Equity Equivalent Programmes described in paragraph 8 constitute approved programmes.

 

3.2 The Minister of Trade and Industry may approve certain Equity Equivalent Programmes after the entity applying for recognition of Equity Equivalents has consulted with the Minister of Finance with respect to their Equity Equivalent proposal and the Minister of Finance has forwarded a recommendation to the Minister of Trade & Industry.

 

3.3 Equity Equivalent Programmes are preferably Sector Specific, but the Minister of Finance may consider requests for approval of programmes that are not Sector Specific.

 

3.4 Equity Equivalent Programmes may involve:

 

3.4.1 Programmes that support:

 

3.4.1.1 The new Growth Path;

 

3.4.1.2 The Industrial Policy Action Plan;

 

3.4.1.3 The National Skills Development Strategy;

 

3.4.1.4 The National Treasury policy priorities referred to in the document "A Safer Financial Sector to Serve South Africa better";

 

3.4.1.5 The DBSA Jobs Fund;

 

3.4.1.6 The Accelerated and Shared Growth Initiative for South Africa;

 

3.4.1.7 The Joint Initiative for Priority Skills

 

3.4.2 Programmes that promote enterprise creation in respect of co-operatives that are:

 

3.4.2.1 More than 50% owned by Black People; or

 

3.4.2.2 More than 30% owned by Black Women; or

 

3.4.2.3 More than 50% owned by members of Black Designated Groups;

 

3.4.3 Any other programmes that promote Socio-Economic advancement or contribute to the overall social development of the Republic of South Africa.

 

3.5 Equity Equivalent Programmes must include:

 

3.5.1 A full description of programme objectives and projected outcomes;

 

3.5.2 Qualification criteria for participation in the programme;

 

3.5.3 Timelines for implementation and delivery with milestones against which progress is measurable; and

 

3.5.4 Details regarding the sponsors of the programme.

 

3.6 Equity Equivalent Programmes are not limited to Multinationals subject to a Global Practice or local branches of foreign banks, but are available to all Measured Entities in the Sector, subject to the limitation on local measured entities as per paragraph 2.3 above.

 

3.7 Equity Equivalent Programmes may have any of the following as their beneficiaries:

 

3.7.1 Enterprises in which:

 

3. 7.1.1 Black People hold more than 50% of the exercisable voting rights and more than 50% of the economic interest;

 

3.7.1.2 Black Women hold more than 30% of the exercisable voting rights and more than 30% of the economic interest; and

 

3.7.1.3 Black Designated Groups hold more than 50% of the exercisable voting rights and more than 50% of the economic interest; or

 

3. 7.1.4 Communities, natural persons or groups of natural persons where at least 75% of the beneficiaries are Black People and the same percentage of economic value is derived by Black People.