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

Amended Codes of Good Practice (2013)

Amended Code Series 100: Measurement of the Ownership Element of Broad-Based Black Economic Empowerment

Statement 100: The General Principles for Measuring Ownership

Key measurement principles

3.4 Modified Flow-Through Principle
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3.4Modified Flow-Through Principle

 

3.4.1A Measured Entity applying this Modified Flow-Through Principle cannot benefit from the Exclusion Principle.

 

3.4.2The Modified Flow-Through Principle applies to B-BBEE owned or controlled company in the Ownership of the Measured Entity.

 

3.4.3In calculating Exercisable Voting Rights under paragraph 2.1.1, and Economic Interest under paragraph 2.2.1 of the Ownership scorecard the following applies:

 

3.4.3.1Where in the chain of Ownership, Black people have a flow-through level of participation of at least 51 %, and then only once in the entire ownership structure of the Measured Entity, such Black participation may be treated as if it were 100% Black.

 

3.4.4The Modified Flow-Through Principle may only be applied in the calculation of the indicators in paragraphs 2.1.1 and 2.2.1 of the Ownership scorecard. In all other instances, the Flow-Through Principle applies.