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 103: The Recognition of Equity Equivalents

3. Recognition of Equity Equivalent Programmes
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3.1Any Equity Equivalent Programme forming part of this Sector Code constitutes an approved programme. Specifically, the Equity Equivalent Programmes described in paragraph 8 constitute approved programmes.

 

3.2The Minister of Trade and Industry may approve certain Equity Equivalent Programmes after the entity applying for recognition of Equity Equivalents has consulted with the Minister of Finance with respect to their Equity Equivalent proposal and the Minister of Finance has forwarded a recommendation to the Minister of Trade & Industry.

 

3.3Equity Equivalent Programmes are preferably Sector Specific, but the Minister of Finance may consider requests for approval of programmes that are not Sector Specific.

 

3.4Equity Equivalent Programmes may involve:

 

3.4.1Programmes that support:

 

3.4.1.1The new Growth Path;

 

3.4.1.2The Industrial Policy Action Plan;

 

3.4.1.3The National Skills Development Strategy;

 

3.4.1.4The National Treasury policy priorities referred to in the document "A Safer Financial Sector to Serve South Africa better";

 

3.4.1.5The DBSA Jobs Fund;

 

3.4.1.6The Accelerated and Shared Growth Initiative for South Africa;

 

3.4.1.7The Joint Initiative for Priority Skills

 

3.4.2Programmes that promote enterprise creation in respect of co-operatives that are:

 

3.4.2.1More than 50% owned by Black People; or

 

3.4.2.2More than 30% owned by Black Women; or

 

3.4.2.3More than 50% owned by members of Black Designated Groups;

 

3.4.3Any other programmes that promote Socio-Economic advancement or contribute to the overall social development of the Republic of South Africa.

 

3.5Equity Equivalent Programmes must include:

 

3.5.1A full description of programme objectives and projected outcomes;

 

3.5.2Qualification criteria for participation in the programme;

 

3.5.3Timelines for implementation and delivery with milestones against which progress is measurable; and

 

3.5.4Details regarding the sponsors of the programme.

 

3.6Equity Equivalent Programmes are not limited to Multinationals subject to a Global Practice or local branches of foreign banks, but are available to all Measured Entities in the Sector, subject to the limitation on local measured entities as per paragraph 2.3 above.

 

3.7Equity Equivalent Programmes may have any of the following as their beneficiaries:

 

3.7.1Enterprises in which:

 

3. 7.1.1Black People hold more than 50% of the exercisable voting rights and more than 50% of the economic interest;

 

3.7.1.2Black Women hold more than 30% of the exercisable voting rights and more than 30% of the economic interest; and

 

3.7.1.3Black Designated Groups hold more than 50% of the exercisable voting rights and more than 50% of the economic interest; or

 

3. 7.1.4Communities, natural persons or groups of natural persons where at least 75% of the beneficiaries are Black People and the same percentage of economic value is derived by Black People.