B-BBEE and the Property Industry
As everyone in the industry knows, the Property Practitioners Act No. 22 of 2019 took effect in February 2022, and it had a major impact on the entire property industry.
Every person dealing in or linked to property in their business, was affected.
The Act appointed The Property Practitioners Regulatory Authority, giving it extensive powers within which to operate.
- Professionalising and regulating property practitioners.
- Educating and training property practitioners.
- Inclusion of previously disadvantaged individuals.
- Consolidating all role players in the industry.
- Dealing with consumers.
- Ensuring compliance with the Act.
The Act also legislated that:
- all persons dealing in property must hold a fidelity fund certificate and be registered with the PPRA
- all persons dealing in property must hold a BEE certificate except for EME earning less than R2.5m/annum who are not required to hold any certificate. EME’s earning between R2.5m and R10m/annum must hold a BEE Affidavit
How does holding a B-BBEE certificate affect me as an estate agent?
Firstly, if you do not hold or are not exempt from holding a B-BBEE certificate, you cannot register with the PPRA, nor can you hold an FFC. The Act provides for exemptions for natural persons, including a natural person who is a sole proprietor.
A B-BBEE certificate must be valid for twelve months in every financial year of the entity.
Overall Compliance with the PPRA and other regulatory bodies
Property Principal Services is geared to manage your agency’s compliance across the board. Why not use our service, explained in this article?
Broad-Based Black Economic Empowerment
In a nutshell, B-BBEE is a guideline to gauge companies’ empowerment scores. As a property practitioner principal, you will fall into one of three categories:
- EME – Exempt micro-enterprise where you have an annual turnover of less than R10m.
- QSE – Qualifying small enterprise where your annual turnover is above R10m but less than R50m. This category must comply with certain requirements.
- Generic business or an Enterprise has an annual turnover of above R35m.
The property industry has different kinds of businesses and ranges from asset-based, service-based, real estate agencies and so on. These all carry different definitions and requirements, and it is important that if you fall into the QSE or Generic categories, you employ the services of an accredited B-BEEE consultant. You must only employ a SANAS-accredited consultant.
Here are a few tables showing BEE scoring requirements, which will be discussed with your BEE consultant.
| BEE Elements | QSE Weighting | Generic Weighting |
|---|---|---|
Ownership | 25 Points | 25 Points |
Management control | 15Points | 19 Points |
Skills development | 25 Points | 20 Points |
Enterprise and supplier development | 30 Points | 42 Points |
Socio economic development | 5 Points | 5 Points |
Total | 100 Points | 111 Points |
| BEE Status | Qualification | Recognition Level |
|---|---|---|
| Level One Contributor | >100 points on the amended Property Sector Scorecard | 135% |
| Level Two Contributor | >95 but <100 points on the amended Property Sector Scorecard | 125% |
| Level Three Contributor | >90 but <95 points on the amended Property Sector Scorecard | 110% |
| Level Four Contributor | >80 but <90 points on the amended Property Sector Scorecard | 100% |
| Level Five Contributor | >75 but <80 points on the amended Property Sector Scorecard | 80% |
| Level Six Contributor | >70 but <75 points on the amended Property Sector Scorecard | 60% |
| Level Seven Contributor | >55 but <70 points on the amended Property Sector Scorecard | 50% |
| Level Eight Contributor | >40 but <55 points on the amended Property Sector Scorecard | 10% |
| Non-Compliant Contributor | >40 on the amended Property Sector Scorecard | 0% |
When scoring is looked at by your consultant, they will be looking to attribute your bonus points, which come in different ways, one of which being when you create jobs, especially for black women or disabled people. A huge factor is the employment of youth in the industry, and this is also favourably looked upon. Other points can be derived from, for example, training those who are part of your supplier chain.
Skills development and bonus points
Training, educating, and employing is a good way to achieve points, and the bonus is that you should get back at least 70% from the SSETA you use for your learnerships. These learnerships must be applied through the correct channels, and your consultant will advise you. Learnerships should not only be for the employed, and where you can, you should include unemployed learners. If you are keen to score points in this manner you must ensure that the learning program is for a minimum of six months and the learner must be employed by you for at least a year.
- Ensure you are registered with the correct Seta.
- Pay skills levies – 1% of payroll. This is not obligatory in order to apply for learnerships.
- If more than 50 employees, appoint a training committee.
- Provide training for the training committee and meet quarterly.
- Keep all minutes, attendance registers and training records.
- Verify that the training is QCTO and SSETA accredited.
| Narrative Description | Delivery Mode | Learning Achievement | |
|---|---|---|---|
| A | Institution-based theoretical instruction alone – formally assessed by the institution. | Institutional instruction – universities and colleges, schools, abet providers. | Degree, diploma or certificate issued by an institution of learning. |
| B | Institution-based theoretical instruction and some practical learning with an employer or in a simulated work environment – formally assessed through the institution. | Institutional instruction or workplace or workplace environment – universities and colleges, schools, ABET providers and workplace. | Degree, diploma or certificate issued formal institution of learning. |
| C | Recognised or registered structured experiential learning in the workplace that is required after the achievement of a qualification – formally assessed by a statutory occupational or professional body. | Structured learning in the workplace with mentoring or coaching. | Occupational or professional knowledge and experience formally recognised through registration or licensing. |
| D | An occupationally-directed instructional and work-based learning programme that requires a formal contract – formally assessed by an accredited body. | Institutional instruction together with structured, supervised experiential learning in the workplace. | SAQA registered qualification, a certificate or other similar occupational or professional qualification issued by an institution of learning. |
Acronyms:
PPRA: Property Practitioners Regulatory Authority
FFC: Fidelity Fund Certificate
B-BBEE: Broad-based black economic empowerment
SANAS: South African National Accreditation System
SSETA: Services Sector Education and Training Authority
QCTO: Qualification Council for Trades and Occupations
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