No contradictions between Broad-Based Black Economic Empowerment (B-BBEE) codes and interpretive guide
13 November 2008
The Department of Trade and Industry (the dti) has noted, with grave concern, recent media reports in which it was inferred that the Department’s Broad-Based Black Economic Empowerment (B-BBEE) Interpretive Guide contradicted the (B-BBEE) Codes of Good Practice with respect to the structure of private equity funds.
The dti wishes to declare the following:
The overarching framework for the implementation of B-BBEE is reflected in the Codes of Good Practice. The Interpretive Guide, issued immediately after the gazetting of the Codes, seeks to provide guidance and clarity on the practical implementation of B-BBEE requirements, and not to detract from the Code’s principles or extend the law.
The interpretation of any provision in the Guide should be consistent with the objectives and principles of the Codes, and where inconsistencies may arise, the principles in the Codes of Good Practice should take precedence. This message has been communicated by the dti in a consistent manner, and is how the market has been applying the Guide in relation to the Codes. Wherever uncertainty has arisen in any aspect of the Codes, be it with reference to the Guide or Codes, the Department has always given guidance to those seeking clarity and direction in this regard.
As the dti, we continue to service the public by providing ongoing guidance on any aspect of B-BBEE implementation, with which the market is unclear, employing the provisions of the legal framework as the foundation for this guidance. Thus, there is no basis to allege that the Guide is causing deals to be “hamstrung”, as erroneously reflected in recent media reports.