Introduction

Broad-Based Black Economic Empowerment (B-BBEE) compliance is crucial for businesses aiming to contribute to economic transformation and inclusivity. The Companies and Intellectual Property Commission (CIPC) plays a significant role in facilitating B-BBEE certification for eligible entities. Let’s explore the process of obtaining B-BBEE certificates through affidavits and understand their implications.

What Is an Exempted Micro Enterprise (EME)?

An EME is a business with a turnover of less than R10 million. These enterprises are exempt from the requirement to produce a formal B-BBEE certificate. Instead, they can compile an affidavit indicating their B-BBEE status and shareholding.

The B-BBEE Affidavit Process

1. Eligibility: EMEs can apply for a B-BBEE certificate (affidavit) during business registration or when filing annual returns.
2. Affidavit Completion: Customers complete an affidavit, which must be signed by a commissioner of oaths.
3. Stamping and Validity: Once stamped by a commissioner of oaths, the affidavit serves as a valid B-BBEE certificate. No further verification is required for EMEs.
4. Free of Charge: CIPC provides B-BBEE certificates to EMEs at no cost.
5. Validity Period: The certificate is valid for 12 months from the date of issue and cannot be renewed. After expiration, a new application must be filed.
6. Application Restrictions:

• Only directors/members of entities can apply for B-BBEE certificates; intermediaries or third parties are not allowed.
• Providing incorrect shareholder information is a criminal offense.
• Applications cannot be amended once submitted; changes are recorded when applying for a new certificate after expiration.
• Entities with at least one foreign director/member do not qualify for CIPC B-BBEE certificates.
• All directors/members’ contact details must be up to date to receive a unique OTP (One-Time PIN) during the application process.

Why Choose B-BBEE Affidavits?

1. Simplicity: EMEs benefit from a straightforward process without the need for extensive verification.
2. Cost-Effective: Affidavits are free, making compliance accessible to small businesses.
3. Legal Compliance: EMEs fulfill their B-BBEE obligations without the burden of formal certification.

Conclusion

B-BBEE affidavits empower EMEs to participate actively in economic transformation. By simplifying compliance, CIPC supports these enterprises in contributing to a more inclusive South African economy.

Contact our offices for professional advice in this regard.