B-BBEE Structuring — questions
Frequently asked questions about B-BBEE structuring
B-BBEE status is determined by your turnover category under the Amended Codes of Good Practice, ranging from a sworn affidavit for Exempted Micro Enterprises to full verification against the Generic scorecard, with ownership, skills development and enterprise and supplier development the three priority elements that carry sub-minimum requirements.
What turnover makes my company an Exempted Micro Enterprise?
Broadly, annual turnover under R10 million qualifies a company as an Exempted Micro Enterprise, allowing B-BBEE status to be confirmed by sworn affidavit rather than full verification.
What is a priority element and why does it matter?
Ownership, skills development, and enterprise and supplier development are priority elements on the Generic scorecard. Failing to meet the sub-minimum on a priority element discounts your overall B-BBEE level, even if your total score is otherwise strong.
Can a trust hold shares for B-BBEE ownership purposes?
Yes, provided the trust genuinely gives beneficiaries voting rights and economic interest that flow through as the Codes require. A trust used only to generate a certificate without real beneficiary benefit will not survive verification.
What is an employee share ownership plan and how does it help my score?
An employee share ownership plan holds shares on behalf of qualifying employees, contributing to ownership points where it meets the Codes' requirements for genuine economic interest and, where relevant, voting rights.
Do I need a SANAS-accredited agency to verify my scorecard?
Qualifying Small Enterprises above the affidavit threshold and all Generic entities generally need verification by an agency accredited by the South African National Accreditation System for the certificate to be recognised by customers.
What is fronting and what are the consequences?
Fronting is misrepresenting B-BBEE status, including window-dressing arrangements without genuine participation. It is a criminal offence under the B-BBEE Act and can result in exclusion from organs of state procurement for up to ten years.
How does the discounting principle work?
Failing the sub-minimum on one priority element discounts your overall B-BBEE level by one level. Failing two or more priority elements discounts it by two levels, regardless of your total points score.
How often do I need to renew my B-BBEE certificate?
Certificates are generally measured and renewed annually, aligned to your financial year, since ownership, spend and staffing figures used in the scorecard change from year to year.
Can vendor-financed ownership deals count for B-BBEE points?
Yes, but the Codes require the financing to leave genuine economic benefit flowing to the black shareholders rather than the shareholding existing purely to service debt without real distributable benefit.
What is the fastest way to move up a B-BBEE level?
It depends on your current scorecard, but addressing a failed priority element sub-minimum usually produces the fastest improvement, since it removes a discount that is otherwise capping your level regardless of other points earned.
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Last reviewed: 2026-09-17
Written and reviewed by Dynamic Legal Services (Pty) Ltd, registration 2016/074955/07. Registered with the Department of Water and Sanitation, EAPASA applicant. Offices in Faerie Glen, Pretoria and Sandown, Sandton. Telephone 087 153 6207, support@dlegal.co.za. General information on South African regulatory practice, not advice on a specific matter — the first consultation is free.