Here’s an update on important industry news and updates from our team.
DTIC Practice Note
The DTIC published a Practice Note (Gazette 44591) on 18 May 2021, providing much-needed and long-awaited clarity on the approach that should be followed to interpret the measurement of ownership for entities such as Broad-Based Ownership Scheme’s (BBOS), Employee Share Ownership Programmes (ESOP), Trade Unions, Not for Profit Companies (NPCs) and Trust’s (Collective Enterprises).
The Practice Note, gazetted in terms of section 14(2) of the B-BBEE Act, is legally binding. It explains how the evidentiary and reporting treatment of discretionary Collective Enterprises and the B-BBEE rules related to measurement should be applied.
Some of the topics that have now been clarified include:
- Confirmation that a defined class of beneficiary satisfies the ownership requirements of the Codes - beneficiaries need not be individually mentioned by name;
- Confirmation that Voting Rights of participants/beneficiaries are to be measured - fiduciaries merely exercise the right to vote on behalf of the beneficiaries;
- Allowance for discretion to be applied by the fiduciaries on the value or portion of Economic Interest distributions to beneficiaries or participants, notwithstanding the rules for Trusts, ESOPs and BBOS;
- Evergreen ESOPs structures that provide perpetual benefit to workers may also satisfy the ownership provisions of the Codes;
- Minors are not restricted from being participants or beneficiaries in any way; and
- Distributions can be in the form of cash or in-kind, and both can be claimed under the Economic Interest indicator of the ownership scorecard.
ICT Council: removal of 07 May 2020 letter
On 14 December 2020, the ICT Sector Council confirmed that the burden of proof does not fall to the B-BBEE Rating Agency for payment of ICT council fees by ME’s or suppliers and that the ICT Council letter from 07 May 2020 stating so has been removed. Subsequently, it will not form part of the compliance checks required during the B-BBEE Verification.
AQRate’s POPIA compliance
With the POPIA enforcement deadline looming, we thought it would be a good time to update everyone on our progress and answer many frequently asked questions.
Our POPIA journey started around 2014-2015 when drafts of the act were undergoing public feedback. We recognised early on that many of the requirements in the act were based on good business practices already engrained at AQRate. The right to privacy and confidentiality being foremost. We also found that the conditions of POPIA were already required by many of the NDA and contractual agreements already in place with our clients.
To make compliance simpler, in late 2019, we embarked on a total redesign of our IT systems, with our entire infrastructure being moved to the cloud. This was a God-send as just a month after the last system was migrated, COVID-19 hit. That meant that we could ensure the safety of our staff by allowing them to work from home and continue to service our clients with minimal disruptions.
We found that for POPIA compliance, very little needed to change in the way we engage clients and our approach to confidentiality. AQRate does not outsource any verification functions to third parties, which simplifies implementation. Most of our focus has been around staff awareness, updating client communication templates, further improving security safeguards and privacy controls, and making it easier for clients to conduct their due diligence on AQRate.
The most important lesson we have learnt is that everyone is new to POPIA, and there is a lot of uncertainty surrounding its enforcement. We promise to remain organised and respond as things mature with the regulator and industry best practices.
We have prepared a POPIA disclosure document that summarises our measures to comply with POPIA. We trust this will assist you in complying with your responsibilities as a responsible party conducting due diligence on AQRate as one of your operators processing personal information on your behalf (section 21 of the act).
You can download a copy of the document here: https://bit.ly/AQRatePOPIA.
If you have any queries, please do not hesitate to contact our office at This email address is being protected from spambots. You need JavaScript enabled to view it.. For technical queries outside of your verification, please direct your question in as much detail as possible to This email address is being protected from spambots. You need JavaScript enabled to view it..
Sincerely,
Jeanette Buys
CEO
Tel: 021 914 9451 / Fax: 021 914 6295 / www.aQrate.co.za
