The 2013 Amended B-BBBEE Codes of Good Practice (CoGP) introduced a new facet to B-BBEE, namely those of Affidavits for SMME compliance.
The introduction of B-BBEE Affidavits for SMMEs replaced the previous requirement of submitting letters from your accounting officer/financial auditors to confirm your revenue, % Black and/or Black Female Ownership and therefore achieving an automatic B-BBEE recognition level. It is important to note that affidavits are not applicable for the Transport sector at this stage, as they have not amended their sector code to align to the 2013 Amendments, and therefore must still make us of the accountant or auditor’s letter.
Below we have indicated the two types of Affidavits available as well as the automatic recognition levels applicable based on the listed percentage of Black Ownership:
Short Name | Full Name | Level 4 | Level 2 | Level 1 |
EME | Exempted Micro Enterprise | < 51% | ≥51% but <100% | 100% |
QSE | Qualifying Small Enterprise | N/A – requires full verification | ≥51% but <100% | 100% |
* Applicable to majority of sector codes
It should be noted that the only acceptable affidavit(s) are those completed on the template provided for by the dtic, B-BBEE Commission or Sector Council. Furthermore, the type of affidavit used will depend on the sector code, and the above automatic recognition can and does differ for certain sector codes. It is vital to ensure you have used the correct affidavit for your sector based on the business activities that generate the majority of the company’s revenue stream, which becomes the sector Code that must be followed.
When completing or verifying a B-BBEE Affidavit, it is imperative that you ensure the below has all been completed accurately:
- Ensure the affidavit is the correct version based on the applicable sector code;
- If the template requires a selection to be made between Owner/Director/Member, a selection MUST be made;
- Ensure all company details are accurately captured, and that any non-applicable items are marked as such;
- Ensure that where the various Ownership percentages are captured than no blanks are left, they should be “NIL”, “0” or “N/A”;
- Ensure the split of the sub-groups of the item for Designated Groups are the actual percentages, and not the split of the total % Designated Group Ownership;
- If the template requires a selection to be made between Audited Financial Statements, Financial Statements or Management Accounts, a selection MUST be made;
- When confirming the financial year-end being used, this must, at a minimum, contain both the month and the year, and where indicated, the day should also be included;
- The level should be indicated with a Tick placed in the relevant box corresponding to the level of Black Ownership;
- Finally, the date of signature by the deponent MUST be the same as the date of the commissioner’s stamp.
Should any of the above not be met, that affidavit is considered invalid and may not be used by an organisation as a valid status of your B-BBEE credentials, or claiming of any points towards preferential procurement for spend with the organisation who has supplied the affidavit. All affidavits are valid for 1 (one) year from date of issue, inclusive of the date of signature, e.g. an affidavit signed on the 1st of August 2024 will expire on the 31st of July 2025. Understanding how to complete, how to read, and how to capture the correct B-BBEE credentials for your suppliers is an important function of your supply chain team or finance team. Incorrect details could pose a significant threat to the validity of your B-BBEE claims and could materially impact your B-BBEE verification. For any queries on the above as well as any guidance or assistance required, please reach out to us and we will gladly assist with ensuring compliance through best practice.
Suzaan Bezuidenhout
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