Following assent by President Jacob Zuma and its release in the government gazette, the Broad-Based Black Economic Empowerment (BBBEE) Amendment Act, No. 46 of 2013 is now enforced as law, the Department of Trade and Industry (DTI) said on Monday.

Trade and Industry Minister Dr Rob Davies said the Act was necessary to enable the department to perform some of the functions embedded within it.

He further believed it was imperative for the development of subordinate legislation, and to ensure the effective implementation of the BEE Codes of Good Practice.

“The intention of the Amendment Act is to strengthen the effective and consistent implementation and reporting across the economy, as well as to put in place mechanisms to deal with noncompliance. This is embedded in the key objectives of the Amendment Act,” he outlined.

According to Davies, the amendment sought to create an institutional environment for monitoring and evaluating BBBEE; deal with noncompliance and circumvention by, among others, introducing offences and penalties; provide for the regulation of the verification industry; give effect to government policy aimed at reducing inequality, defeating poverty and creating employment; and align the Act with other legislation impacting on BBBEE and the Codes of Good Practice.

He added that some of the key material amendments in the Act referred to aligning the Act and the BEE codes, which comprised an interpretation clause extended to include a trumping provision that stipulated that the BBBEE Amendment Act would trump any law that was in force prior to its commencement date.

The Act would also result in the establishment of a BBBEE commission, which would be created as an entity within the administration of the DTI, headed by a commissioner appointed by the Minister.

The commission would be responsible for overseeing, supervising and promoting adherence to the Act, as well as the monitoring and evaluation of BBBEE.

The Act made further specific reference to fronting practices and misrepresentation of the BBBEE status of an enterprise, setting clear penalties that included a minimum penalty of ten years imprisonment, or a fine.

If the offender was not a natural person, a fine of 10% of yearly turnover would be applied.

“With the gazetting of the proclamation notice, these key material amendments will come into immediate effect,” he advised.