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

Codes of Good Practice on Broad-Based Black Economic Empowerment

Amended Property Sector Code

Statement 000: General Principles and General Scorecard as applied to the Amended Property Sector Code

17. Definitions



A measure of the learners ability to successfully secure formal permanent or long-term contract employment for the learner or to assist the learners proceed with further education and training.

Acceptable Valuation Standard

Valuation of an asset, an economic interest, an enterprise or any other instrument or right relevant to measurement under Statement 100 of the Codes. All such valuations shall be undertaken in accordance with normal valuation methods that represent standard market practice.

Accredited BEE Verification Agencies

An enterprise that has been accredited by SANAS, or any other body authorised by the Minister to undertake accreditation of verification agencies, on behalf of the DTI, who meet the minimum technical and black economic empowerment criteria for rating agencies and whose main role is to provide an independent opinion on the B-BBEE status of an enterprise.

B-BBEE enterprises

Enterprises whose B-BBEE score in terms of a sector scorecard which has been issued as a code of practice or in terms of the DTI’s generic  scorecard is greater than or equal to 40% and has been verified by an accredited verification agency.

Benefit scheme

A Broad-Based Ownership Scheme in which more than 50 natural persons:

- are intended to benefit from an Economic Interest received by the scheme or by the fiduciaries of the scheme; and
- the economic benefits paid from the Economic Interest received is not distributed but rather applied to the benefit of the scheme's Deemed Participants.

Black Aged People

Black people who are also aged people as defined in the Aged Persons Act 81 of 1967, as amended or substituted.

Black disabled people

Black people who also satisfy the criteria in the definition of 'persons with disabilities' set forth in paragraph 5.1 of the "code of good practice on the employment of people with disabilities" (as amended or substituted from time to time) issued in terms of section 54(1)(a) of the Employment Equity Act, 1998;

Black New Entrant

A black participant(s) (which includes without limitation, black participants in broad-based ownership schemes) holding in aggregate in excess of 2% of the total voting rights and economic interest in a measured enterprises who has not, prior to their acquisition of their equity interest in a measured enterprise, concluded similar transactions in respect of any other enterprise, which in aggregate have a cumulative value of R50million measured in accordance with an acceptable valuation standard.

Black people

Is a generic term that means Africans, Coloureds and Indians

(a) Who are citizens of the Republic of South Africa by birth or decent; or

(b)        Who become citizens of the Republic of South Africa by naturalisation

(i)        Before 27 April 1994

(ii)        On or after 27 April 1994 and who would have been entitled to acquire citizenship by naturalisation prior to that date.

Black Unemployed People

Black people who are unemployed and are not attending or are not required by law to attend an educational institution and who are not awaiting admission to an educational institution.

Black Women

Black people who are women.

Black Youth

Black persons who are also youth as defined in the National Youth Development Agency Act 54 of 2008, as amended or substituted from time to time;

Broad-based Black Economic Empowerment

The economic empowerment of all black people including women, workers, Youth, people with disabilities and people living in rural areas through diverse but integrated socio-economic strategies that include, but are not limited to—

- Increasing the number of black people that manage, own and control enterprises and productive assets;
- Facilitating Ownership and management of enterprises and productive assets by communities, workers, co-operatives and other collective enterprises;
- Targeted procurement; and investment in enterprises that are owned or managed by black people;
- Human resources and skills development;
- Achieving equitable representation in all occupational categories and levels in the workforce;
- Facilitating the provision of additional skills to black employees at all levels in the workforce.

Commissioned agent

A person who only earns commission, receives no salary.

Community Scheme

Any scheme or arrangement in terms of which the shared use of and responsibility for part of land and building, including but not limited to sectional title development scheme, share block company, home owners association and a housing scheme for retired persons. And scheme has the same meaning.

Deemed current value

The result of the formula in paragraph 17.6 of DTI Code 100, Statement 100. The formula is: the value of the instrument(s) to which a black Participant's Economic Interest attaches minus the carrying value of any third party rights or claims that may exist against that black Participant as a result of the financing of the acquisition of the instrument(s) divided by the current value of the Measured Enterprise. All values to be upon the date of measurement.

Deemed participant

A natural person entitled to receive a distribution or benefit from a broad-based ownership scheme.

Designated groups

(a) Means unemployment black people not attending and not required by law to attend an educational institution and not awaiting admission to an educational institution
(b) Black people who are youth as defined in the National Youth Commission Act of 1996;
(c) Black people who are persons with disabilities as defined in the Codes of Good Practice on employment of people with disability issued under Employment Equity Act;
(d) Black people living in rural and under-developed areas.
(e) Black military veterans who qualifies to be called a military veteran in terms of Military veterans Act 18 of 2011.

Development in under resourced areas

Only new stock is considered in this case as development excluding any upgrades, any improvements and/or extensions of existing stock

Distribution scheme

A Broad-Based Ownership Scheme in which more than 50 natural persons are intended to receive distributions from the scheme that are payable from the Economic Interest received by the scheme or by the fiduciaries of the scheme.

Economic Development

Investment and property development in under-resourced areas based on the infrastructure municipality index developed by Financial Draft aligned sector code (FSC).

Note: An Economic Development Investment anticipates a return on investment whereas a Contribution is a recognised payment within an Economic Development Programme with no return expected.

Economic Interest

A Participant's Claim against the Enterprise representing a return on ownership of the Enterprise, measured in accordance with the Flow- Through and Modified Flow-Through Principles. In this regard, a Participant's entitlement to receive any payment or part payment on the Participant's Claim from a Measured Enterprise that is not in the nature of a return on ownership in that Measured Enterprise, will be treated as an Economic Interest if such payment is:

- not arms-length;
- not market-related;
- mala fide; or
- without a commercial rationale; or
- intended to circumvent the provisions of this statement or the objectives of the Act.


Estate Agent

(a) means any person who for the acquisition of gain on his own account or in partnership, in any manner holds himself out as a person who, or directly or indirectly advertises that he, on the instructions of or on behalf of any other person:
Sells or purchases or publicly exhibits for sale immovable property or any business undertaking or negotiates in connection therewith or canvasses or undertakes or offers to canvass a seller or purchaser therefor; or
Let’s or hires or publicly exhibits for hire immovable property or any business undertaking or negotiates in connection therewith or canvasses or undertakes or offers to canvass a lessee or lessor therefor; or
Collects or receives any moneys payable on account of a lease of immovable property or any business undertaking; or
Renders any such other service as the Minister on the recommendation of the board may specify from time to time by notice in the Gazette;
(b) for purposes of section 3(2)(a), includes any director of a company or a member who is competent and entitled to take part in the running of the business and the management, or a manager who is an officer, of a close corporation which is an estate agent as defined in paragraph (a);
(c) for purposes of sections 7, 8, 9, 12, 15, 16, 18, 19, 21, 26, 27, 30, 33 and 34B, includes:
any director of a company, or a member referred to in paragraph (b), of a close corporation which is an estate agent as defined in paragraph(a); and
any person who is employed by an estate agent as defined in paragraph (a) and performs on his behalf any act referred to in subparagraph (i) or (ii) of the said paragraph;
for the purposes of section 7, 9(1)(a), 16, 26, 27, 28 and 33, includes any person who is employed by an attorney or a professional company as defined in section 1 of the Attorneys Act, 1979 (Act No. 53 of 1979), otherwise than as an attorney or an articled clerk, and whose duties consist wholly or primarily of the performance of any act referred to in subparagraph (i) or (ii) of paragraph (a) on behalf of such attorney or professional company;
(d) does not include an attorney who, on his own account or as partner in a firm of attorneys of as member of a professional company, as defined in section 1 of the Attorneys Act, 1979 (Act No. 53 of 1979), or an articled clerk as defined in the said section of that Act, who performs any act referred to in paragraph (a), in the course of and in the name of and from

Effective Date

The date on which this Sector code is gazetted as a sector charter.

Eligible Procurement

All expenditure to acquire goods and/or services, including capital expenditure, but excluding: procurement spending where there is a monopoly as a result of government regulation; all salaries and wages; investments in or loans to enterprises supported in terms of enterprise development initiatives claimed in a B-BBEE scorecard; donation through initiatives measured in terms of the residual element of the scorecard; and importation of all goods and services, including capital goods, provided that it can be demonstrated there is no local production of the specific imported goods or services.

Employee scheme

A Broad-Based Ownership Scheme in which a group of employees representing more than 90% of the employees of an Enterprise or 90% of the employees in a particular occupational category(ies) (as referred to in form EEA9 the Employment Equity Act) within an Enterprise. Employee Schemes may have the characteristics of Benefits Schemes or Distribution Schemes or hybrids of both.

Employment Equity

As defined in the Employment Equity Act 1998 means to promote equal opportunity and fair treatment in employment through the elimination of unfair discrimination and the implementation of affirmative action measures to redress the disadvantages in employment experienced by designated groups, in order to ensure their equitable representation in all occupational categories and levels of the workforce. It obliges employers with over 50 employees to prepare Employment Equity plans and report on a yearly or bi-yearly basis to the Department of Labour (DoL).


The person(s) conducting a business, trade or profession in the Republic of South Africa.

Equity Interest

The entitlement of a participant to receive an economic interest and to exercise a voting right in an Enterprise.

Generic Scorecard

The balanced BEE scorecard included in the DTI Code 000 Statement 000.

Global Policy

Globally applied restriction or regulation to which an enterprise is bound, which inhibits the enterprise from selling equity.


A process whereby an academically qualified individual performs work for a specified period under the supervision of a qualified professional, with the end result of qualifying as a professional.

Investment Activities

Activities that consist of buying and selling long-term assets and other investments.

Joint venture

Normally, unincorporated bodies, regarded in law as partnerships in which the partners are jointly and severally liable for the acts, neglects and omissions of the partnership. A Joint venture is a venture normally formed ad-hoc for a specific project, in which two or more parties share obligations, risks and rewards. Joint ventures in the Procurement context are formed to realise commercial opportunities made available through the award of contracts.


As defined in the Skills Development Act, a structured learning component which: includes practical work experience of a specified nature and duration; would lead to a qualification registered by the South African Qualifications Authority and related to an occupation; and would be registered with the Director-General in the prescribed manner.

Listed property

A listed property fund is a company that derives its income from property and property related sources. A listed property fund is an income fund because it pays out almost all its income, while normal listed companies retain anything up to 80% of their income.

Management (estate agencies only)

For the purposes of this charter, in the case of estate agencies, anyone earning more that R360,000 a year and possessing a level of authority. This salary threshold will be increased in line with the consumer price index (“CPIX”) on the first day of January each year.

Management - Senior Management

Managers who plan, direct and co-ordinate the activities of a business and who have the authority to hire, discipline and dismiss employees and have a cost to company package (excluding bonuses) to the employer of R450,000 per annum or more, but excludes all employees who fall within the definition of Executive Management. The salary bands will be increased in line with the consumer price index (“CPIX”) on the first day of January each year.

Management - Middle Management

The level of management below Senior Management and includes people who possess a high level of professional knowledge and experience in their chosen field with a cost to company package (excluding bonuses) to the employer of between R225,000 and R450,000 per annum. The salary bands will be increased in line with the consumer price index (“CPIX”) on the first day of January each year.

Management - Junior Management

The level of management below Middle Management and includes academically qualified workers who possess technical knowledge and experience in their chosen field and have a cost to company package (excluding bonuses) to the employer of between R150,000 and R225,000 per annum. The salary bands will be increased in line with the consumer price index (“CPIX”) on the first day of January each year.


The process of assisting others to gain further knowledge, experience and skills. It is an activity that can be successfully used where senior employees develop people within a company to enhance their job development.

Net Asset value

Entities ‘value minus its liabilities.


Means salary and wages or similar remuneration payable by an employer to an employee, but does not include any bonus, incentive or commission.


Practicing commercial property brokers /estate agents.


Zoned Land and/or improvements.

Property brokerages

Enterprises participating in the sale and leasing of commercial property.

Property development

Development of commercial or residential property.

Property ownership

A right or title, in part or whole, either in the form of a unit, land or building, where the owner derives economic benefit. It may include, but is not limited to, freehold title, sectional title, shares, leasehold property.

Property sector

For the purposes of this charter the property sector refers to all enterprises that participate in property ownership including but not limited to all property owning enterprises (and/or the assets themselves), property services enterprises and residential property enterprises.

Property services enterprises

Includes but not limited to: Facilities management, Property management, Asset Management, Valuers, Conveyancers and other professional service providers in the property sector.

Property Unit Trust

Property Unit Trust, a collective investment scheme in property which invests in a portfolio of investment grade properties that is held for its rental income and capital appreciation.

Residential property enterprises

Any enterprise involved in facilitating the selling, renting or managing of residential property.


Is considered when there is a structural change to the building including the building function.

Real Estate Investment Trust –


REITS - is a company that owns, and often operates, income-producing property. - is a listed property investment vehicle that is similar to internationally recognised REIT structures from around the world. Listed Company REITs or Trust REITs are publically traded on the JSE REIT board and qualify for the REIT tax dispensation.


Company REITs may be internally managed or externally managed. Trust REITs are externally managed.


Therefore in defining the terms within the Property Sector Charter which are relevant to REITs, it is important to align the definitions exactly up as per tax legislation.


NPAT is not defined within section 25BB and therefore with respect to REITs, the correct calculation “Taxable Income (as calculated in terms of S25BB of the Income Tax Act) after tax”.


Means a Sector Education and Training Authority established in terms of section 9(1) of the Skills Development Act 97 of 1998.

Share register

A Share registry is an entity that provide the following services to the shareholders on behalf of the listed companies: Share register maintenance, receiving, validating and processing of share transfers, Dividend distribution by all modes. Registration of new shareholders, handling general enquiries and handling IPO's.

Skills Development

The transfer or gaining of technical knowledge, related skills, values and attitudes in order to develop proficiency and to develop a person’s natural aptitudes and other abilities to improve his/her capabilities as a worker. Training, which generally takes place outside formal educational institutions, is more often than not directed towards the needs of a specific employer or group of employers. Skills development spend refers to the direct cost, excluding peripheral costs, incurred by a company for accredited or sector acknowledged training and development including costs related to learnerships and bursaries and excluding the skills levy as per the skills development legislation.


State-owned enterprise, being an enterprise, owned or controlled by government.


The previous 12 months orders at the time of measurement. All expenditure should be counted at the time of invoicing.


Includes all employees and for the purposes of this charter commissioned agents.


A company controlled by another usually a large corporation. When that control or ownership is not shared, it is termed a wholly-owned subsidiary. Subsidiaries are distinct legal entities for purposes of taxation and other forms of regulation.

Superannuation scheme

A “provident fund”, a “pension fund” and a “retirement annuity fund” as defined in Schedule 2 of the Tax Act 58 of 1962.

Under-resourced areas

Areas, which did not receive adequate infrastructure development investment or attention from the previous dispensation or the private sector. As defined in the Transformational Infrastructure document by Financial Sector Charter).

Unlisted public mandate collective investment schemes

Unlisted public company wholly owned by mandated investments and public entities.

Transformational infrastructure

Also known as bulk service contributions. These projects stimulate development efforts in under-resourced areas. Projects that support economic development in under-resourced areas and contribute towards equitable access to economic resources. Such infrastructure projects could be in the following sectors: transport; telecommunications; water, waste water and solid waste; energy; social infrastructure such as health, education, and correctional services facilities; and municipal infrastructure and services.

Triple bottom line

A business concept that refers to corporate attainment of balanced and integrated economic, social and environmental performance.

Unemployed Learner

A learner that was not in the employment of the employer party to the learnership agreement concerned when the agreement was concluded. The employer and learner must therefore enter into a contract of employment.

Value of Enterprise

As Average Annual or such other mechanism as defined in Codes of Good Practice.