In need of a BEE certificate?

Cape Town – Do you need a BEE certificate as a small business owner? It depends on whether you are an SME or EME, says a Fin24 expert.

A Fin24 user who owns a small business wants to know about BEE certificates. “All franchisers want BEE certificates. How do I go about this now, as I have just seen the amended legislation?”

Fin24 business development expert Anton Ressel had this advice:

If your turnover is under R5m, you automatically qualify as an EME (Exempt Micro Enterprise) and should not have a problem accessing a franchise opportunity, provided of course you meet all their other criteria.

“For proof of this you would need a letter from your accounting officer confirming that you meet the criteria to qualify as an EME. Alternatively, you can google one of the many BEE verification agencies and have a proper audit done, although there are some costs to this route. Good luck.”

According to Fin24 sister publication FinWeek, an EME automatically qualifies as a Level 4 contributor, receiving an allocation of 65 points and is recognised as a 100% BEE company for procurement purposes; and if your business is black-owned, you get bumped up to Level 3.

According to the B-BBEE Codes, an exempt micro enterprise has a turnover of less than R5m per annum (the threshold is R2.5m in the tourism sector and R1.5m for built environment professionals in the construction sector)."

“EMEs are exempt from the usual compliance requirements that are needed to reach Level 4 status. Unfortunately the term ‘exempt’ tends to lead to complacency in the micro business sector, with many business owners believing that they do not need to participate in the B-BBEE drive to open the economy to all. Some also feel that it is not necessary to get a valid BEE Certificate at all.

“But this view is misinformed. There are very good reasons (read here for reasons why) for EMEs to engage in B-BBEE and to raise their status to an even higher level. The process has been made very easy to get there.”

-Fin24.