EMPOWERMENT REQUIREMENTS
How more than half of trusts are not compliant
An early analysis and assessment has shown that more than 50% of trusts registered are not compliant with Broad-Based Black Economic Empowerment (B-BBEE) requirements. Most of the trusts do not satisfy requirements of the ownership scorecard, Trade and Industry Minister Rob Davies says, because they are dedicated to skills development and community projects but not ownership, which means black participants are treated as beneficiaries and not shareholders. In August, the B-BBEE Commission announced that it was investigating a number of companies and entities for allegedly violating the B-BBEE Act. The commission said it would look into issues such as fronting practices including the use of trusts in B-BBEE ownership structures. Nokia Solutions and Networks SA would be investigated to determine whether the ownership transaction involving its employee trust and Sekunjalo Investment complied with the act. The transaction resulted in 26% black ownership and a subsequent change in black ...
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