Some of the country’s most important black empowerment investment vehicles, which have been fighting to have their status recognised by the BEE commissioner’s office, say they are pleased that trade, industry & competition minister Ebrahim Patel has ended the uncertainty and confirmed them as genuine black owners.
This confirmation should, however, be officially published, they said.
The trusts are some of the first BEE vehicles established in SA and include: Kagiso Charitable Trust; Mineworkers Investment Trust; HCI Foundation; Women’s Development Bank Trust; Ditikeni Investment Trust; and Wiphold Trusts. They were established long before legislation to regulate BEE and score companies existed.
BEE commissioner Zodwa Ntuli, who is tasked with registering transactions and establishing compliance, has argued that the trusts do not constitute proper ownership as they do not have shareholders in which ownership of company equity vests and to whom dividends flow. The trusts do, however, have beneficiaries who benefit through a variety of schemes, which are funded by dividend flows from investments. The parties have been in a two-year stand-off over interpretation of the law.
On Friday, announcing an expanded employee ownership scheme for Coca-Cola Beverages SA, Patel said it was his firm view that employee ownership schemes of various structures qualified as BEE as did trusts, which broadened economic participation and inclusivity.
“On the matter of broad-based trusts that hold equity and their status: I think that these are the pioneers of BEE and should be recognised appropriately — for example, companies such as Kagiso,” he said.
Speaking on behalf of the six trusts, Mineworkers Investment Company CEO Mary Bomela said: “We welcome minister Patel’s comments that go some way to put an end to the uncertainty about the status of the pioneering broad-based BEE [BBBEE] trusts. We urge minister Patel to issue a public notice soonest regarding the interpretation of the code as the continued regulatory uncertainty has had a negative impact on their current and future business prospects.
“The trusts have always regarded themselves as being fully compliant in terms of current BBBEE legislation, and in terms of statement 100 of the amended codes of good practice. This applies particularly to the status of our BBOS [broad-based ownership scheme], which have been through rigorous scrutiny and verification,” she said.
“We are pleased to hear the minister agree that our structures, some of the earliest empowerment vehicles in SA, represent true black ownership and empowerment. This is excellent news for our trusts and their more than 642,000 beneficiaries, and we eagerly await publication of an announcement to this effect from the DTIC [department of trade, industry & competition].”
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.