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Broad Based Black Economic Empowerment Act, 2003 (Act No. 53 of 2003)

Industry Charters

Agri-BEE Charter

5. Elements of Empowerment

5.1.1 General Ownership


In line with the Strategic Plan, the mission of this element is to enhance equitable access and participation in the agricultural Sector; to deracialise land and Enterprise ownership; and to unlock the full entrepreneurial potential in the Sector.


Historically, the interpretation of ownership in agriculture has been understood to be dependent upon ownership of land. This AgriBEE framework makes a distinction between land and Enterprise ownership.


AgriBEE is fundamental to the long-term growth and competitiveness of the Agricultural Sector. AgriBEE activities and processes should ultimately lead to the creation of viable and sustainable Enterprises in the Agricultural Sector.


Stakeholders in the Sector will work towards the development and implementation of a diversity of Enterprise ownership models in support of AgriBEE.


All Sector Stakeholders should endeavour to source sufficient financing in order to ensure the establishment of viable and sustainable Enterprises.


Agri-Industry undertakes to: -


5.1 .1 .1. Further Black participation through ownership in the Agri Industry by increasing the level of entitlement of Black People to participate in the Economic Interest and Exercisable Voting Rights in existing and new Enterprises. This includes the sale of equity in a Measured Enterprise, sale of assets through Qualifying Transactions and/or through share equity schemes and other forms of joint ventures with farm labourers and other Black entrepreneurs; Further Black ownership in the Agricultural Sector through the sale of assets. This is achieved by selling equity in Associated Enterprises in a Qualifying Transaction. Qualifying Transactions must be scored in terms of Statement 102 of the Codes of Good Practice, which states that equivalency points may be earned under the ownership element through this mechanism. In order for an Enterprise to enjoy continued recognition for ownership on the Scorecard through a Qualifying Transaction, the Transaction must ultimately result in:


the creation of sustainable businesses or business opportunities for Black People; and
the transfer of specialised skills or productive capacity to Black People; and
it must not result in unnecessary job-losses;
it must involve a separate Associated Enterprise which has:


no unreasonable limitations with respect to its clients or customers;
clients, customers or suppliers other than the Enterprise with which the Qualifying Transaction was undertaken; and
no operational outsourcing arrangements with the initiating Enterprise that were not concluded at arms-length on a fair and reasonable basis.


Government undertakes to:-        Implement all legislative and other measures at its disposal to facilitate black ownership.


5.1 .1.4. Facilitate access to state BEE funds that are made available by government departments, State-Owned Enterprises, and financial institutions.