With the adoption of the new Broad-Based Black Economic Empowerment Act 53 of 2003 as amended by Act 46 of 2013, some changes have come into effect on how Exempt Micro Enterprises (EME) obtain a BEE certificate. The amendments to the act have made it easier for EME to obtain a BEE certificate and has also reduced the cost of compliance, by eradicating the need for EME’s to go through a verification process. It should also be noted that Accounting Officers and Accreditation agents are no longer permitted to issue B-BBEE certificates to EME’s as they have done in the past.
In summary, the amended codes in Code Series 000 states that an EME is only required to obtain either of the following an annual basis, provided turnover is below R10,000,000
- Sworn affidavit stating the company’s turnover and B-BBEE credentials.
- CIPC certification
Either of the above 2 documents will now be excepted as your BEE certificate.
The affidavit must be completed in full in line with your company’s standing and signed by the Commissioner of Oaths as per the requirements in the Justices of Peace and Commissioners of Oaths Act, 1963 (Act No. 61 of 1963). There is an affidavit template on our website should you want to download it on http://www.ap-accounting.co.za/index.php/articles/downloads.
CIPC certificates are also valid as B-BBEE certificates and can be obtained on the CIPC website http://www.cipc.co.za/index.php/manage-your-business/manage-your-company/bbbee/. They can be obtained either at the CIPC self-service terminals or online when filing your annual returns.
Change of Status and violation of the Act
It is important to note that should the empowerment status of the entity change any time after it has made such an affidavit or obtaining the certificate from CIPC, the entity is obligated to disclose that fact when submitting its B-BBEE status to any person.
If an entity is found to have violated the Act, an entity could be fined up to 10% of its annual turnover, and individuals involved could be imprisoned for up to 10 years, and or fined. Specifically, an offence under section 13O (2) could lead to imprisonment of up to 12 months, or a fine, or both the fine and imprisonment.
If there is anything that is unclear regarding the above please do not hesitate to contact us either through our contact us page on the website, or directly on 011 706-1545.