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by the Department of Trade and Industry (“DTI”) due to resistance and criticism
from the business community to the inclusion of this criterion.
BEE All companies participating in the YES Initiative must determine its YES target

for new job creation based on criteria stipulated in the Proposed Amendments.
Entities that are unable to create a sufficient number of new jobs in order to
meet their targets may also qualify by sponsoring new placements in Exempt
Micro Enterprises or Qualifying Small Enterprises.
Proposed amendments to the Enterprise and Supplier development Statements

The key amendments which are proposed here are the introduction of a
multiplier factor of 2 for 51% black owned or 51% black women owned entities
under the Preferential Procurement Scorecard; the combination and reallocation
of points and targets for procurement expenditure on EMEs and QSEs under
the Preferential Procurement Scorecard; and the recognition of Enterprise
Development or Supplier Development initiatives irrespective of the growth in
turnover of the relevant enterprise or supplier development beneficiary.

Proposed amendments to the Skills Development Statement
Skills development expenditure on bursaries for black students at Higher
Education Institutions has been proposed as a new sub-element under the skills
development scorecard. The compliance target is 2.5% of the leviable amount
- essentially an entity’s annual payroll - for four points on the skills scorecard.
The target for skills development expenditure on learning programmes in
the learning programme matrix is however proposed to be reduced from 6%
to 3.5% of the leviable amount for six points in order to accommodate the
new bursary sub-element. The provision that legitimate training costs such as
accommodation, catering and travelling cannot exceed 15% of the total value
of skills development expenditure will not apply to the target for bursaries for
black students at Higher Education Institutions, allowing such expense items to
be included for recognition under the new bursary sub-element.

Reaction and way forward
The proposed amendments, specifically pertaining to enhanced recognition for
black owned Generic enterprises, have been met with widespread criticism from
various sectors and have been hailed as a proposal for “the death of Broad-
Based BEE”. It is expected that further dialogue will take place on this aspect
between the DTI and relevant industry role players. The proposals regarding
the YES Initiative and recognition for bursaries to black students under skills
development have on the other hand been more positively received and should
in all probability find their way into the amended BEE Codes. For the moment, it
is still a waiting game to see what will come of the Proposed Amendments and
in particular whether the DTI will press through with the controversial enhanced
recognition for black owned Generic enterprises.

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