state's BEE policy contradictory - law firm
6 June 2007

Shepstone & Wylie says framework and codes define beneficiaries differently.

There were contradictory elements in the government's black empowerment policy that made it difficult for companies to comply with and benefit from the requirements, Erika Petersen, an associate partner at Shepstone & Wylie Attorneys, said yesterday.

Petersen, who was addressing the company's clients on the importance of BEE, said certain requirements of the Preferential Procurement Policy Framework Act (PPPF) contradicted the BEE codes of good practice.

"The PPPF, which stipulates how the State Tender Board should award tenders, has a different definition of beneficiaries when compared with the BEE codes," said Petersen.  "When awarding tenders the PPPF looks only at the ownership of the company and it does not ask for scorecards that are required in the BEE codes."

The act describes beneficiaries as historically disadvantaged individuals, which includes any female regardless of race, disabled people and anyone who did not have the vote before 1994.

The BEE codes define beneficiaries as any black person, whether African, coloured or Indian, who obtained the country's citizenship after 1993 or who was discriminated against by apartheid policies.

Communication director at the treasury, Thoraya Pandy said the department of trade and industry and the treasury were working out a solution to resolve the contradictions. She said they were finalising the process, which would include aligning the BEE codes with the PPPF, and an announcement would be made in due course.

She said BEE was the biggest challenge facing business in South Africa today, but it was also a great opportunity for business.

The department of trade and industry was unavailable for comment yesterday.

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Slindile Khanyile, www.busrep.co.za