COVID-19 and B-BBEE: Time extension for B-BBEE submissions and filings during lockdown

As the South African government intensifies its implementation of integrated measures in the fight against the global COVID-19 pandemic, public functionaries such as the Broad-Based Black Economic Empowerment (B-BBEE) Commission and the Office of the Master of the High Court (Master’s Office), have either closed or reduced their operations following the President’s announcement on 23 March 2020 of a nation-wide lockdown, initially due to last from 23h59 on 26 March to 23h59 on 16 April 2020. On 9 April, the President announced an extension of the lockdown until 23h59 on 30 April 2020.

20 Apr 2020 3 min read Corporate & Commercial Alert Article

These measures have a significant practical effect on pending B-BBEE transactions, B-BBEE compliance requirements, and engagements with the B-BBEE Commission.

B-BBEE Commission – submissions, filings and offices closure during lockdown

On 25 March and 15 April 2020, the B-BBEE Commission issued notices to stakeholders announcing the closure of the B-BBEE Commission’s offices during the lockdown, and extending the time for parties to submit major B-BBEE transactions and compliance reports and file correspondence and documents with the B-BBEE Commission. The effect of this is that parties/entities now have more time to properly prepare their B-BBEE submissions and filings.

In terms of the B-BBEE Commission’s updated notice –

  • parties that concluded or will conclude a major B-BBEE transaction from 11 March 2020 to 30 April 2020 which are required to be filed for registration;
  • JSE listed entities, organs of state and public entities, and SETAs that are required to submit compliance reports any time from 26 March 2020 to 30 April 2020; and
  • stakeholders that have a timeline that falls on a date that is during the lockdown period announced by the President for submission of responses to allegations in a complaint, responses to findings in an investigation, responses for alignment of major B-BBEE transactions and any relevant deadline,

are granted indulgence to file or submit these to the B-BBEE Commission within 30 calendar days following the end of the lockdown period announced by the President, notwithstanding any prescribed periods contemplated in the B-BBEE Regulations.

The B-BBEE Commission’s offices are closed during the lockdown period and are officially scheduled to reopen on 4 May 2020. As such, the B-BBEE Commission will not be accepting any documents or correspondence relating to a complaint, transaction, compliance report or any other process in the B-BBEE Regulations filed by email or delivered to the offices during the lockdown.  The timeline for any document or correspondence submitted during the lockdown period will only be counted with effect from 4 May 2020. 

The B-BBEE Commission will monitor the situation and adjust the timelines as may be necessary post the lockdown period announced by the President.

Closure of Master’s Office during lockdown

On 31 March 2020, the Minister of Justice and Correctional Services issued amended directions limiting access to certain Department of Justice service points, including Master’s Offices, during the lockdown period. The services rendered by the Master’s Office will be limited to payments for the benefit of minors and persons under curatorship, documents required for the burial of a deceased person, and urgent appointments of curators, throughout the lockdown period.

What this means for B-BBEE transactions is that, while the requisite documents to establish and regulate trusts established for the benefit of black people – as are commonly used in employee share ownership programmes and broad-based ownership schemes – may be drafted and validly concluded, the Master’s Office will not register such trusts or issue letters of authority to appointed trustees until after the lockdown period.

CDH remains available and committed to engaging with the B-BBEE Commission, Master’s Office and other bodies to service our clients’ needs during the lockdown. Please contact us for any assistance with B-BBEE compliance requirements.

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