FREQUENTLY ASKED QUESTIONS (FAQ)Please click on any question to get answers
- The introduction of Economically Active Population (EAP) targets which aims to address the unequal representation of race sub-groups participating in the industry;
- The setting aside of minimum levels of procurement spend from Suppliers that are at least 51% Black Owned or at least 35% Black Women Owned;
- Sustainable empowerment initiatives that leave a legacy for the future of the industry;
Unlike with the OLD Construction Sector Codes that were repealed, the provisions of paragraph 1.5.4 of Statement CSC 000 makes it compulsory Verification Agencies to ensure that BBBEE certificates & reports issued in terms of the ACSC are annually provided in a prescribed format to the CSCC in line with Section 10 (4) of the B-BBEE Amendment Act.
The Construction Sector Charter Council will use this information to assess the performance of the sector and to provide accurate and reliable state of the industry reports to the line Minister and the DTI.
- For the ‘Ownership’ and ‘Management Control’ elements it is the B-BBEE compliance of the Measured Entity is at the Date of Measurement (which is the date of verification)
- For ‘Skills Development’, ‘Enterprise and Supplier Development’ and ‘Socio-Economic Development’ elements, it is the B-BBEE compliance of the Measured Entity over the Measurement Period. (which is the year prior to the verification period).
In terms of provisions of paragraph 2.4 – 2.5 of Statement CSC 000, any misrepresentation or attempt of the Measured Entity’s true B-BBEE Status is a criminal offence & will be dealt with in accordance with the provisions as set out in the B-BBEE Act, including the disqualification of the entire scorecard of the entities concerned.
Initiatives which split, separate or divide a Measured Entity with the intent of ensuring eligibility as an Exempted Micro-Enterprise (EME), a Qualifying Small Enterprise or a Start-Up Enterprise will constitute an offense and will be dealt with in accordance with the provisions as set out in the B-BBEE Act as amended.
Unincorporated Joint Ventures are required to compile a consolidated BBBEE verification certificate. A consolidated verification certificate will consolidate the scorecard points scored by each of the joint venture partners in accordance with paragraph 2.8.2 below as if those Measured Entities were a single Measured Entity.
START-UP Enterprises are defined more fully in Page 80 of the ACSC and these are referred to as “recently formed or incorporated Measured Entity that has been in operation for less than one (1) year”. Simply put, a START-UP enterprise does not necessarily have to be made up of more than one enterprises whilst a Joint Venture has to.
The measurement of a START-UP Enterprise is done in accordance with the provisions of 6.2 – 6.4 of Statement CSC 000 of the ACSC. Of particular measurement interest to note about START-UPs, as per provisions of paragraph 6.4, is that where they elect to seek any other economic activity covered by section 10 of the BBBEE Amendment Act, with a value higher than R 10 million, then they must submit a QSE BBBEE level certificate and scorecard.
Do EMEs only have to score the full 14 points on the QSE Skills Development element or was it supposed to be that they should score full points on indicator 1, in other words 1.1, 1.2 and 1.3? We are also unsure why they included the (excluding bonus points) in this paragraph if it is only applicable to indicator 1.1.
EMEs seeking enhancement need to comply with the Skills Development element (QSE CSC 301) as a whole and apply the B-BBEE Status Level and B-BBEE Recognition Level so determined. This will exclude bonus points.
A nominal fee document specifying the detail of the information that must be included in the declaration by EMEs and QSEs seeking such enhancements is available at the CSCC website and on request.
A Measured Entity is either measureable against the targets and weightings of a BEP or a Contractor/Material Supplier and cannot apply the set of targets, weightings and methodology applicable to BEP’s in the case of one element and the set applicable to Contractors in the case of another element.
Where a Measured Entity operates in more than one sector or sub-sector (e.g. Contractor or BEP), whether it requires a single entity verification or a consolidated verification for it as a group; it will be required to report in terms of:
- scorecard for the sector or sub-sector in which the majority of its core activities (measured in terms of annual Revenue) are located, and
- Should the majority of its core activities be in the construction field, the measured Entity may be evaluated in terms of the Amended Construction Sector scorecard should these activities conform to those described in the definitions of a Contractor or BEP in these codes.
Construction related activities, Contractors and classes of works are clearly defined and outlined in the definition section of the ACSC (pages 72-73) read with the CIDB application for contractor registrations accessible from the CIDB website www.cidb.org.za