MAJOR CHANGES PROPOSED TO B-BBEE CODES: JUST ANOTHER FEEDING TROUGH

10 February 2026

On 29 January 2026, the Department of Trade, Industry and Competition (dtic) published Notices in the Government Gazette where they invited interested parties and the public to submit written comments on the new and proposed amendments to several B-BBEE Codes of Good Practice draft statements.

The draft statements include:
  • proposed amendments to general principles;
  • amending the generic scorecard used to measure B-BBEE compliance; and
  • to amend the scorecards specifically designed for Qualifying Small Enterprises and specialised enterprises. 
The most notable of these proposed amendments is the inclusion of a Transformation Fund as an alternative to the traditional Enterprise and Supplier Development (ESD) programmes.
 
This proposal will allow companies to contribute 3% of their Net Profit After Tax (NPAT) annually, towards the Transformation Fund for a maximum of 20 points, as an alternative to the current framework whereby measured entities can identify their own ESD programmes but can only earn 15 points, plus 4 possible bonus points.

The inclusion of the proposed Transformation Fund and the contributions thereto is further extended as a qualifying mechanism through which Equity Equivalent programmes may be recognised, as an alternative for Multinationals who lack qualifying black shareholding in their South African Operations.
It seems clear that the more stringent ESD requirements proposed, coupled with the introduction of the state-controlled Transformation Fund, are aimed at channelling all ESD contributions to the Transformation Fund, as this will be the easiest option to comply with. The Transformation Fund will be nothing more than another ANC slush fund, with no transparency or accountability. South Africans can be assured that these contributions will just disappear down a deep, dark hole.
The proposed amendments under Preferential Procurement highlight an aggressive shift towards procuring from 100% black-owned businesses (currently with at least 50% black-owned or 30% black women-owned businesses) with the introduction of three new categories from which businesses would need to procure from:
  • 100% black-owned enterprises
  • 100% black-owned QSEs and EMEs
  • 100% black women-owned enterprises
The impact these proposed changes will have on large, small and specialised businesses that subscribe to B-BBEE will be significant.

Most notable is the change required by a measured entity’s procurement strategies, systems and processes to meet the new Preferential Procurement category targets, as well as preparing a detailed analysis and performance framework against the new monitoring and evaluation requirements for ESD.

NEASA encourages businesses that need BEE to sustain their business, to consider the applicable draft amended statements and to submit their written comments via email or hand-deliver it to the dtic on the proposed amendments by no later than 28 March 2026.

Note that comments relating to the above proposed amendments must be forwarded in writing for the attention of the B-BBEE Policy unit to the following email addresses, which differ for each draft statement:
 

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