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 100: The General Principles for Measuring Ownership

3. Key measurement principles

3.3 Modified Flow-through Principle
Purchase cart Previous page Return to chapter overview Next page

 

3.3.1The Modified Flow-Through Principle applies to any B-BBEE owned or controlled company in the ownership of the Measured Enterprise.

 

3.3.2 In calculating Exercisable Voting Rights under table 2a, paragraph 2.1 and Economic Interest under paragraph 2.3, the following applies: Where in the chain of ownership, Black People have a flow-through level of participation in excess of 50%, then only once in that chain may such black participation be treated as if it were 100% black.

 

3.3.3The Modified Flow-Through Principle may only be applied in the calculation of the indicators in paragraphs 2.1 (Voting rights of Black People) and 2.3 (Economic Interest of Black People) of table 2a. In all other instances, the Flow-Through Principle applies. For avoidance of doubt, the Modified Flow-Through calculation may be applied once in each chain on ownership.