Get your B-BBEE certificate now to apply for FFCs
MAIN IMAGE: Portia Tau-Sekati, CEO of the PSCC; Robert Dalton, Director of BEE Consultex; Bryan Biehler, Director of Huizemark; Robert Krautkramer, Director of Miltons Matsemela
Real estate agencies have until the end of October 2022 to obtain a B-BBEE certificate to be eligible for their Fidelity Fund Certificates (FFCs).
The PPRA requires that a B-BBEE Certificate must be included in the application for either the first application or renewal of an FFC. This is after the new Property Practitioners Act came into operation on 1 February 2022. It is therefore vital that all owners of estate agencies start preparing themselves for compliance.
Portia Tau-Sekati, Chief Executive Officer of the Property Sector Charter Council (PSCC), said although every agency must get the B-BBEE certification, there is no specific level of compliance needed. The B-BBEE certification can be obtained by contacting verification agencies that have extension of the scope of the property sector code.
“For the last seven years we have had a poor response from agencies when we asked for these certificates and from what we have gathered to date most estate agencies do not have the necessary BEE certificates.” When asked if the authorities will be able to process applications before the October 2022 deadline, she said “There is certainly enough time if everyone starts the preparation now and does not leave it to the last minute.” According to the EAAB Annual Report 20/21 there were 7 237 estate agency firms in South Africa.
The need for an audit to be conducted by a verification agency depends on the size of the organisation which is determined by the annual turnover earned. ”If you are a generic or large sized organisation, or a qualifying small enterprise (QSE) or a medium sized organisation, you will need to be audited. If you are an exempted micro enterprise (EME – where the entity’s last financial year’s turnover was less than R2.5 million) you only require an affidavit,” she said.
Tau-Sekati also said that if an agency wants to renew its B-BBEE certification, the same process that enabled the agency to acquire the initial B-BBEE certificate should be followed. These certificates are only valid for 12 months. The cost associated with the BEE certification depends on the workload that the verification agency anticipates.
She also said that the B-BBEE certificate requirement is part of a drive towards transformation in the industry and that the Property Sector Charter Council will use the consolidated information to start garnering an understanding of the challenges of transformation.
“Once we understand the challenges, we will be able to have targeted approach to unblocking barriers of transformation,” she said.
“The PPRA confirmed that the recipient of a FFC only requires a valid B-BBEE certificate i.e., a certificate that is current and has not expired. There is currently no requirement for the recipient to achieve a particular B-BBEE score or level,” Robert Dalton, Director of BEE Consultex said.
Bryan Biehler, Director of Huizemark and founder member of the PSCC, said this drive will have an impact on transformation. “Transformation is important to the industry and we fully support it, but it is a complicated and very involved process,” he said.
Robert Krautkramer, Director of Miltons Matsemela, said the best way to obtain a B-BBEE certificate is to contact a B-BBEE verification company who will be able to assist with the application process.
“It is important to note that this requirement is regulated by the new Property Practitioners Act, but it only applies to the agency and not the individual unless the individual is a sole proprietor.”
Krautkramer also emphasised that the B-BBEE certificate will be valid for the lifespan of the FFC and should be renewed when applying for a new FFC, which is after three years, but this is not specified in the new Act.
According to Tau-Sekati a valid B-BBEE certificate should indicate the following:
- The name of the BEE verification agency
- The name of the measured entity and the BEE certificate number
- The registration number, VAT number, and physical address of the measured entity
- The sector code the agency is measured against (i.e., Property Sector code)
- The size of the organisation – generic, QSE or EME
- The score achieved for each element
- The BBBEE contribution level
- The percentage black ownership
- The percentage black women ownership
- The modified flow-through application
- The empowering supplier
- The discounting principal applied
- The signature of the BBBEE technical signatory
- The date of issue, or re-issue if applicable
- Expiry date
- SANAS emblem