1. On 5 October 2012, the Revised Codes of Good Practice were published
in the Government Gazette, for public comment. (Notice 800 of 2012,
No.35744.Interested parties have 60 days (until 4 December 2012)
within which to submit comments to the DTI on these revised codes.
Once all comments have been received the Minister will release the
Codes to be implemented in the New Year.
The new Codes for 2013 have huge penalties for not complying. For
example if your company is Generic (Annual Turnover of R35 million
and more) you will be required to comply with 5 elements. Out of
the 5 elements 3 elements are priority elements. The 3 priority
thresholds are Ownership, Skills Development and Supplier
Development (which is Enterprise Development combined with
Preferential Procurement).
The codes become more complex because they expect you to reach a
target of 40% of targets for all the 3 priority elements.
Highlighted in red – Priority Elements
Current Codes NewCodes
Ownership
Target of 25% black participation Target of 40% minimum target of
25% black ownership
10% Equity Deal must be concluded
Penalty for non-compliance Penalty for non-compliance-Generic
No Penalty Drop 2 Levels
Penalty for non-compliance-QSE
Drop 2 Levels
Management Control
Target says the same Top Management, Junior Management
removed.
Employment Equity targets moved to
Management Control

2. Skills Development
Target 3% of Payroll 6% of Payroll
Supplier Development
Preferential Procurement 20points Target 3% NPAT
Enterprise Development 15 40 points
Example: - AGeneric company seeking to qualify to tender for
government work must demonstrate a category 4 compliance level.
Taken at face value, the new codes will immediately reduce non-
compliant companies to level-six status if they do not comply with
any of the minimum requirements will drop 2 levels, thus making them
ineligible for state work or to supply private sector companies
reliant on state work.
Example: - AQSE company (annual turnover between 5-35 million) can
choose 2 priority elements, but ownership is compulsory. If they do
not comply they drop 1 level.
Although the revised codes are only published for comment, it is
clear that changes are now inevitable and it is going to be more
difficult to achieve a high score.
Therefore, it now becomes absolutely vital to prepare for and
achieve a good scorecard before the new codes are finalised.
Your B-BBEE compliance is something that you can no longer shy away
from; let us assist you before the implementation of these new
rules.
The earlier you start the easier; we offer a free evaluation of your
company’s status and will present a clear business plan of what you
need to do to become compliant.
Your B-BBEE certificate may no longer be enough; we can easily
assist you with your Skills development, Procurement and Enterprise
development without any changes to your company ownership.

3. Kind Regards
Rosaline Alexander
BCHANGE MANAGEMENT CONSULTANTS (PTY) LTD
0746100345