Understanding Broad-Based Black Economic Empowerment (B-BBEE)

Most registered companies in South Africa must comply with B-BBEE requirements when bidding for tenders or applying for contracts. Here’s everything you need to know about Broad-Based Black Economic Empowerment (B-BBEE).

What is B-BBEE?

Broad-Based Black Economic Empowerment (B-BBEE) is a program in South Africa that aims to promote economic equality in the country.

It does this by setting requirements for companies that want to bid for government contracts or apply for tenders. These requirements are based on a number of factors, including the company's ownership, management, and employment practices.

By following these requirements, companies can demonstrate their commitment to B-BBEE and increase their chances of success when bidding for contracts or tenders.

What is the difference between a B-BBEE affidavit and a B-BBEE certificate?

B-BBEE affidavits and B-BBEE certificates share the same purpose as both documents are used to verify a company’s black South African citizen ownership.

B-BBEE sworn affidavits are issued to companies that earn less than R10 000 000 per year.

B-BBEE certificates are issued to companies that earn more than R10 000 000 per year.

Do I need a B-BBEE verification?

Although a B-BBEE affidavit/certificate isn’t legally required for most small companies to trade, it’s normally a requirement when applying for tenders, contracts, and funding.

Who can apply for a B-BBEE affidavit or B-BBEE certificate?

A B-BBEE affidavit/certificate just shows your B-BBEE status. Any registered company can apply, even if the company is not partially or fully black-owned.

What are the B-BBEE qualification levels?

B-BBEE qualification levels are used by other companies or government departments to confirm your company’s black ownership percentages.

Here are the B-BBEE qualification levels:

• Level One (135% B-BBEE procurement recognition) - 100% black-owned
• Level Two (125% B-BBEE procurement recognition) - More than 51% black-owned
• Level Four (100% B-BBEE procurement recognition) - Less than 51% black owned

Who qualifies as "Black" in terms of B-BBEE?

Any South African citizen who is African, Coloured, Indian, or Chinese will qualify as "Black" in terms of the B-BBEE Act.

How long is a B-BBEE affidavit or B-BBEE certificate valid?

B-BBEE affidavits and B-BBEE certificates must both be renewed every 12 months.

How to get a B-BBEE affidavit

All registered companies with an annual turnover of less than R10 000 000 can apply for a B-BBEE affidavit online in a few minutes.

Read More: Get a free B-BBEE affidavit online

How to get a B-BBEE certificate

To get a B-BBEE certificate, you will need to contact a registered SANAS-accredited verification agency. This is a company that has been accredited by the South African government to evaluate companies against the B-BBEE requirements and issue B-BBEE certificates.

You will need to provide the verification agency with information about your company, such as your ownership structure, management practices, and employment policies. The verification agency will then evaluate your company against the B-BBEE requirements and issue a B-BBEE certificate.

It's important to note that obtaining a B-BBEE certificate can be a complex and time-consuming process, so it's best to start the process as early as possible.

You can find a list of registered verification agencies on the South African government's website.