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The DTI recently released the Broad-Based Black Economic Empowerment Amendment Act. Here's what you need to know about it

by , 21 November 2014
The fact that the year is coming to a close doesn't mean government is slowing down when it comes to passing legislation.

Late last month, the Department of Trade and Industry (DTI) released the Broad-Based Black Economic Empowerment (B-BBEE) Amendment Act No. 46 of 2013. The Act is now enforced as law.

What are the implications of this law for you as an employer?

Read on and we'll tell you...

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Here's what you need to know about the B-BBEE Amendment Act

According to SAnews.gov.za, 'the Amendment Act aims to strengthen the implementation of B-BBEE and its reporting across the economy, as well as to put in place mechanisms to deal with non-compliance.'
The other objectives, according to the site, are to align the Act with other laws that deal with B-BBEE and the Codes of Good Practice. The Act also deals with the formation of the B-BBEE Commission.
You may recall that in October, we reported that the DTI wanted to set up a commission to look into B-BBEE fronting.
It's now working on it and says the commission will be appointed by 31 March next year.
In the SAnews.gov.za report, Trade and Industry Minister, Rob Davies explained that 'the commission will be responsible for overseeing, supervising and promoting adherence to the Act, as well as the monitoring and evaluation of B-BBEE.'
At the time the announcement was made, Davies said the commission will try to recommend solutions but, where there are serious transgressions, it will have to work with law enforcement agencies to enforce prosecution.
It's clear that government is taking the issue of fronting very seriously. So it's no wonder its introduced serious penalties in the new Act…

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The recently released B-BBEE Amendment Act introduces serious penalties for fronting

The B-BBEE Amendment Act states that fronting is a punishable offence.
In fact, fronting practices will get you a minimum penalty of ten years in jail or a fine of 10% of annual turnover if the offender is not a natural person.
Not sure what fronting is?
In this article, we explain that fronting happens when companies misrepresent their B-BBEE status, stating that they meet a particular condition or have B-BBEE Level they don't.
Government has been struggling to deal with this problem ever since B-BBEE came into place. It now hopes penalties, other key amendments to the Act as well as the new B-BBEE Codes of Good Practice it introduced in July will curb this problem once and for all.
So be warned! Government is watching you and will punish you severely if it finds you guilty of fronting.
PS: If you have any questions about the Act or B-BBEE in general, ask our experts at the Labour & HR Club.

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The DTI recently released the Broad-Based Black Economic Empowerment Amendment Act. Here's what you need to know about it
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