17 firms to be investigated for transgressions of BEE laws

Deputy director-general at DTI and acting B-BEEE Commissioner Zodwa Ntuli
Credit: DTI

Deputy director-general at DTI and acting B-BEEE Commissioner Zodwa Ntuli Credit: DTI

If found guilty, companies may be fined 10% of their annual turnover and individuals are liable for prosecution through the courts.

The Broad-Based Black Economic Empowerment (B-BBEE) Commission will be investigating 17 companies to determine if they have violated the Black-Broad Based Economic Empower (B-BBEE) Act.

The exercise seeks to establish if the companies’ B-BBEE ownership structures comply with the Codes of Good Practice and the Act.

Sidwell Medupe, departmental spokesperson for the department of trade and industry (the dti), said all the entities were notified.

“If there are adverse findings against them, they will be given 30 days to respond to the adverse findings before the B-BBEE Commission makes the findings final,” Medupe said.

In terms of the legislation, the commission is empowered to initiate an investigation on its own volition. It says the investigations often occur after a tip-off from the public.

READ MORE: #SAAEmails: Treasury and BEE commissioner put brakes on irregular procurement

“If found to have violated the B-BBEE Act, the entities may be referred for prosecution and exposed to a fine of up to 10% of the entity’s annual turnover and the individuals involved can be fined or imprisoned for up to 10 years,” Medupe explained.

Further sanctions include exclusion from doing business with government for a period of up to 10 years, and the contracts they have with any state-owned entity or government department can be cancelled.

In addition, the commission may also approach a court to restrain any breach or for any appropriate remedial relief, which may include setting aside the transaction or initiative.

However, the commission refused to be drawn into discussion on the merits and details of the investigative process, but the findings will be published as required by the B-BBEE Act.

The commission has also made available the option to consider alternative dispute resolution, and where an agreement is reached the outcomes will be communicated.


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