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

Operating

Expense

Description

Procurement

Inclusions

Procurement

Exclusions

ADDITIONAL NOTES

Aircraft Fixed Costs

Lease Costs

X

To be excluded - International leases are the norm - difficult to enforce local leasing arrangements

Spares Lease Costs

X

To be excluded - international leases are the norm - difficult to enforce local leasing arrangements

Aircraft Finance Costs

X

Aircraft Hire Charges

X

Aircraft Insurance

X

Depreciation

X

Crew Salaries & Subsistence All

X

Crew Positioning & Accommodation

X

Hotel accommodation only incurred within South Africa - no over border

Crew Training Costs

X

Training consumables only for training incurred within South Africa

Aircraft Variable Costs

Fuel

X

For procurement of jet fuel in South Africa only - as oil companies comply with BEE in terms of Liquid Fuels Sub-Sector Code, include in numerator and denominator of calculation

Landing Fees

X (If landing in privately owned airports)

X (If landing in ACSA airports)

ACSA is a regulated monopoly and as such it is excluded as per the Codes

Navigation Charges

X

Weather Services

X

Maintenance Materials and Repairs

X

Inclusion of maintenance and materials for repairs undertaking in South Africa only - inclusion in numerator and denominator as AMO'S are BEE compliant

Maintenance Staff

X

Head Office AMO

X

Maintenance - Depreciation on capitalised assets

X

Maintenance Engine Hire

X

To be excluded due to nature of aircraft operations and maintenance requirements, engines for hire have to be sourced from over border suppliers and it is not possible to include BEE considerations as part of this process which is often of an urgent nature to keep operations going.

Passenger Variable Costs

Commission Agents

X

Commission - Interline

X

To be excluded - interlining is dependent on passenger choices for travel and cannot be included as a BEE consideration for airlines.

Commission - Credit Cards

X

Catering

X

Only for locally sourced catering requirements. The guidelines provided by the dti Codes will apply with regards to imports.

Airport Handling fees

X (for ACSA airports)

Included for ACSA airports on the basis and understanding that ACSA and their appointed Ground handlers are BEE compliant and can be included in numerator and denominator. These should be included regardless of the ACSA's and Ground handlers BEE status.

Passenger Services Charges

X

Passenger Revenue Accounting

X

Insurance ANV & csl

X

CRS Charges

X

Airline Loyalty programs

X

Station Costs

Station Salaries

X

Station Overheads

X

Only in respect of consumables (i.e. day-to-day operational expenses and excludes overheads/capex) for offices in South Africa. The dti guidelines with regards to the importation of goods and services will be applicable if any of the consumables are imported.

Head Office

Salaries

X

HO Overheads

X

Only in respect of consumables (i.e. day-to-day operational expenses and excludes overheads/capex) for Head Office operations in South Africa. The principle discussed above with regards to station overheads will be applicable.

Finance Charges - Net

X

Franchise Fees

X

To be excluded as this is a global strategy determined by the airline, which could involve a franchise with an international airline or a local airline. Airlines cannot be judged on a BEE basis for franchise arrangements.

Marketing expenses

X

Only in respect of local marketing spend. Excluded for foreign owned airlines where marketing decisions are linked to global contracts.

Diversions

X

Only in respect of accommodation and meal arrangements and expenses incurred for passengers in S.A. Excluded for foreign owned airlines where marketing decisions are linked to global contracts.

Loss on sale of assets (profit)

X

Depreciation

X