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

Amended Codes of Good Practice (2017)

Amended Code Series CSC100: Measurement of the Ownership Element of Broad-Based Black Economic Empowerment in the Construction Sector

Statement CSC100: The General Principles for Measuring Ownership

3. Key Measurement Principles

3.14 Equity Instruments carrying Preference Rights
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3.14.1 An Equity Instrument carrying preferential rights is measurable in the same manner as an ordinary Equity Instrument.

 

3.14.2 An Equity Instrument carrying preferential rights that have the characteristics of a debt, regardless of whether the debt is that of an Entity or of a Participant, must be treated as an ordinary loan. If the debt is that of a Black Participant, it may be subject to measurement under Net Value.

 

3.14.3 In evaluating an instrument that has a hybrid nature including the characteristics of a debt, only that portion that represents a debt will be measured under current equity interest. The remainder is measurable as an ordinary equity instrument.