Latest news with #BBBEE
IOL News
04-07-2025
- Business
- IOL News
Minister Malatsi's policy direction on EEIPs faces backlash from Cosatu
Communications and Digital Technologies Minister Solly Malatsi gazetted a policy direction on the role of EEIPs in the ICT sector, aiming to provide policy certainty and attract investment. Image: X/IOLGraphics Cosatu has expressed concerns over the proposed policy direction on equity equivalent investment programmes (EEIPs) in the Information and Communications Technology (ICT) sector. Communications and Digital Technologies Minister Solly Malatsi gazetted a policy direction on the role of EEIPs in the ICT sector, aiming to provide policy certainty and attract investment. The policy direction allows companies to meet empowerment obligations through alternatives to 30% ownership, such as investing in local suppliers, enterprise development, and job creation according to Malatsi. However, Cosatu spokesperson Matthew Parks, said the Broad-Based Black Economic Empowerment (BBBEE) Act provides two options for investors that include a 30% shareholder option or an equity equivalent option. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading The trade federation giant believes that the BBBEE Act is inclusive and provides accommodating options for all investors and not only for the wealthy. The federation is concerned that the proposed policy direction might allow companies like Starlink to bypass BBBEE requirements. "It's critical that Starlink, like all other investors, comply with the BBBEE Act, whether it is the shareholder or equity equivalent option," Parks emphasised. Parks cited examples of companies like IBM and Microsoft that have utilised the equity equivalent option. Cosatu argues that exempting one company from BBBEE requirements would be unfair. The Black Business Council's (BBC) spokesperson Masedi Sesele also shut down the idea saying it would be 'bending of legislation' to accommodate an individual or company. 'Legislation is there for all to comply with, no exception. Otherwise, the country will become lawless…The BBBEE legislation together with the Codes of Good Practice prescribes that any company wanting to do business in South Africa should implement all the elements of the BBBEE codes being ownership, management control, skills development, enterprise and supplier development, and socio-economic development. We don't know how the rumoured R2 billion is going to implement those important elements." Malatsi, through his spokesperson Kwena Moloto, said the policy direction sought to provide the 'much-needed' policy certainty to attract investment into the Information and Communication Technologies (ICT) sector, and specifically with regards to licensing for broadcasters, internet service providers, mobile networks, or fixed and mobile networks.
IOL News
03-07-2025
- Business
- IOL News
Cosatu, BBC slam Elon Musk's R2 billion investment plan to avoid BEE
Cosatu has slammed Minister Solly Malatsi's attempt to bypass South Africa's 30% local ownership law, purportedly for Elon Musk's Starlink. Image: AP Photo/Francois Mori The Congress of South African Trade Unions (Cosatu) has expressed concerns over the proposed policy direction on equity equivalent investment programmes (EEIPs) in the Information and Communications Technology (ICT) sector. Communications and Digital Technologies minister Solly Malatsi gazetted a policy direction on the role of EEIPs in the ICT sector, aiming to provide policy certainty and attract investment. The policy direction allows companies to meet empowerment obligations through alternatives to 30% ownership, such as investing in local suppliers, enterprise development, and job creation according to Malatsi. However, Cosatu spokesperson Matthew Parks, said the Broad-Based Black Economic Empowerment (BBBEE) Act provides two options for investors that include a 30% shareholder option or an equity equivalent option. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ The trade federation giant believes that the BBBEE Act is inclusive and provides accommodating options for all investors and not only for the wealthy. The federation is concerned that the proposed policy direction might allow companies like Starlink to bypass BBBEE requirements. "It's critical that Starlink, like all other investors, comply with the BBBEE Act, whether it is the shareholder or equity equivalent option," Parks emphasised. The BBBEE Act requires companies to offer 30% shareholding opportunities to historically disadvantaged individuals or offer equity equivalents, such as supporting local manufacturers, creating jobs, upgrading worker skills, or investing in local communities. Parks cited examples of companies like IBM and Microsoft that have utilised the equity equivalent option. Cosatu argues that exempting one company from BBBEE requirements would be unfair. "It would not be sustainable to exempt one company as this would be unfair to other companies and undermine the law," Parks said. Cosatu proposes that the government ensures BBBEE reaches those who most need empowerment, namely workers and working-class communities. The federation advocates for worker empowerment through Employee Shareholder Ownership Programmes and support for locally produced goods. The Black Business Council's (BBC) spokesperson Masedi Sesele also shut down the idea saying it would be 'bending of legislation' to accommodate an individual or company. 'Legislation is there for all to comply with, no exception. Otherwise, the country will become lawless…The BBBEE legislation together with the Codes of Good Practice prescribes that any company wanting to do business in South Africa should implement all the elements of the BBBEE codes being ownership, management control, skills development, enterprise and supplier development, and socio-economic development. We don't know how the rumoured R2 billion is going to implement those important elements. 'Anyone who wants to invest in any country must comply with the ownership legislation of that country. This is happening worldwide and is not unique to SA. So BBBEE regulations should never be exempt. Black people, who constitute 97% of the population and own only 3% of the economy, can't continue to be sidelined in the name of foreign investments,' said Sesele. Malatsi through his spokesperson Kwena Moloto said that the policy direction sought to provide the 'much-needed' policy certainty to attract investment into the Information and Communication Technologies (ICT) sector, and specifically with regards to licensing for broadcasters, internet service providers, mobile networks, or fixed and mobile networks. Communications and Digital Technologies Minister Solly Malatsi defends ICT policy, denies special treatment for Starlink, and stresses the need to align sector regulations with transformation laws through equity equivalent investment options. Image: X/IOLGraphics Moloto, on Thursday, saidthat Starlink was not the only company being considered. Starlink, owned by Elon Musk, reportedly plans to launch its services in South Africa ahead of the G20 conference. However, the company intends to bypass the BBBEE law and its 30% ownership requirement, preferring instead to go the Equity Equivalent Investment Programme route where they have offered to invest R2 billion. Political parties such as the EFF, the African Transformation Movement (ATM) and the uMkhonto weSizwe Party (MKP) have been opposed to the proposed changes, citing concerns about Starlink's compliance with BBBEE laws. Political analyst Professor Sipho Seepe criticised the government and president Cyril Ramaphosa for 'forging ahead' with allowing Starlink to operate in South Africa, saying it would set the wrong precedent.. 'The imbroglio regarding Starlink is further proof that South Africa is up for sale under the Ramaphosa administration. This is what you should expect when you have a prepaid presidency. 'Every penny given to support his presidential candidacy was a future investment to ensure that the South African government would succumb to business demands…The very fact that the Ramaphosa regime is willing to suspend legislation and regulations for pieces of silver is not only shameful but also points to a lack of conviction and commitment by the ANC to the demands of Starlink would set the wrong precedent and open the floodgates by like-minded business people,' Seepe said.
IOL News
25-06-2025
- Business
- IOL News
Did SA bend BEE rules for Elon Musk's Starlink? Ramaphosa says no
President Cyril Ramaphosa denied relaxing BBBEE to benefit South African-born tech billionaire Elon Musk after his visit to the US. Image: Presidency President Cyril Ramaphosa has again poured cold water on claims that South Africa proposed relaxing its black empowerment rules solely for Elon Musk's Starlink, despite the move coming days after his meeting with US President Donald Trump last month. 'Our visit to the United States did not focus on issues of Black Economic Empowerment,' Ramaphosa told Parliament on Wednesday afternoon. 'It focused on resetting the relationship with the United States and ensuring that we continue open conversations with our major trading partners.' He was responding to a question from Nicholaas Hendricks Pienaar of the Democratic Alliance (DA) in Limpopo. Pienaar asked whether the Government of National Unity (GNU) should revise Broad-Based Black Economic Empowerment (BBBEE) policies to attract more international investment and stimulate economic growth and job creation. Ramaphosa reiterated the government's commitment to economic transformation. 'Our commitment to black economic empowerment, as expressed through various policy documents and statements, remains steadfast,' he said. 'Through the Statement of Intent signed by various parties in the GNU, we are committed to translating the values of our Constitution into reality - particularly social justice, redress, and equity.' Last month, IOL News reported that, just days after a high-level meeting at the White House, attended by South African billionaire Johann Rupert and Tesla CEO Elon Musk, the South African government appeared to be easing regulations to facilitate the entry of Starlink, Musk's satellite internet service. The alleged shift in policy has sparked debate over the influence of global business elites on national legislation and whether diplomatic lobbying is steering South Africa's tech and telecommunications framework. Rupert, citing rising crime and economic stagnation, called for Starlink's launch to be fast-tracked. 'We need Starlink in South Africa,' he said. Meanwhile, Ramaphosa pointed to the Constitution's Equality Clause as a foundation for transformation policies like BBBEE. 'There are a number of measures that the Equality Clause calls on us to embark on - legislative measures to protect or advance persons disadvantaged by unfair discrimination,' he said. He emphasised that the BEE Act remains a central lever for inclusive, sustainable growth. 'We must dispense with the false notion that we must choose between transformation and growth,' Ramaphosa said. 'Black economic empowerment is not only compatible with investment and growth - it is essential to achieving broad-based prosperity.' Ramaphosa added that BEE should not be seen as a project for a select few. 'It must be a national project. Everyone, including those who benefited under apartheid, must be involved,' he said. 'Failing to do so risks economic stagnation.' In a follow-up question, Pienaar asked Ramaphosa if he would support foreign investments like Starlink without requiring a 30% ownership stake for local partners. However, Ramaphosa responded by pointing to the country's equity-equivalent model, which allows foreign companies that cannot meet direct ownership requirements to instead contribute to transformation initiatives. 'For offshore-based companies with global ownership structures, we've come up with an innovative, equity-equivalent solution,' Ramaphosa said. 'They embark on initiatives that support transformation and get involved in economic development without handing over equity. And many have embraced this approach.' He added that while South Africa is not unique in requiring local ownership, it may be the only country offering a flexible equity-equivalent system - which many multinational companies have welcomed. 'We are not averse to coming up with good solutions, so long as there is commitment to transformation,' Ramaphosa said. 'That, to us, is not negotiable.' He reiterated the historical rationale for transformation policies. 'Our economy was structured for the benefit of a white minority,' he said. 'They passed laws to exclude others, even from menial jobs. We are turning the tables. We want all South Africans to benefit, not just a few.' [email protected] IOL Politics
IOL News
25-06-2025
- Business
- IOL News
Ramaphosa to face tough questions in NCOP over unemployment, municipal failures
President Cyril Ramaphosa will answer questions at the NCOP in Cape Town as concerns grow over municipal failures and youth unemployment. Image: ANC/X President Cyril Ramaphosa is expected to respond to questions for oral reply in the National Council of Provinces (NCOP) on Wednesday afternoon, on South Africa's high unemployment rate, youth joblessness, and collapsing service delivery in municipalities. Ramaphosa returns to Parliament after missing last week's scheduled appearance due to his attendance at the G7 Summit in Canada. Presidency spokesperson Vincent Magwenya said the questions presented to the president span a wide range of issues, including the Government of National Unity's stance on Black Economic Empowerment, a proposed social compact to rebuild the economy, youth unemployment, and weaknesses in budgetary management and service delivery at the municipal level. 'The president's engagement with the NCOP gives effect to accountability by the executive arm of the state to the legislature and to the principles of cooperative governance between provinces and the national sphere,' Magwenya said. The engagement is scheduled for 2pm at the Bouwmeester Dome in Cape Town. Among the questions Ramaphosa will face is one from Nicholaas Hendricks Pienaar of the Democratic Alliance (DA) in Limpopo. Pienaar is expected to ask whether, following Ramaphosa's recent visit to the United States, he now concedes that to attract more international investment, the Government of National Unity (GNU) must revise Broad-Based Black Economic Empowerment (BBBEE) policies to make them more effective and inclusive in stimulating economic growth and job creation. This comes after Minister of Communications and Digital Technologies Solly Malatsi, who last month proposed a policy direction to guide the Independent Communications Authority of South Africa (ICASA) on the application of BBBEE principles in the Information and Communications Technology (ICT) sector, including licensing requirements for satellite providers such as Elon Musk's Starlink. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading Mandisa Makesini of the Economic Freedom Fighters in the Free State will ask whether, in light of the 2024 Auditor-General's local government audit report, which revealed widespread financial mismanagement and service delivery failures, the president and Cabinet are considering reducing the number of municipalities or merging those deemed unsustainable. Makesini is also expected to ask whether the government would consider establishing a commission of inquiry to manage such processes instead of relying solely on a departmental approach. Auditor-General Tsakani Maluleke recently revealed that only 41 municipalities received clean audits in 2023 and 2024, while 40 regressed compared to the previous term. Most of the municipalities received unqualified audit opinions with findings, indicating credible financial statements but poor performance reporting and compliance. Maluleke said that 219 municipalities spent R1.47 billion on consultants, yet many still submitted flawed financial statements, a long-standing issue that she said has shown little improvement over the past decade. Meanwhile, Seeng Mmabatho Mokoena of the MK Party in KwaZulu-Natal is expected to ask Ramaphosa about his administration's failure to deliver tangible results in addressing youth unemployment.
Eyewitness News
17-06-2025
- Business
- Eyewitness News
EFF says 'there's nothing that has improved' under GNU, which is a govt of convenience
Babalo Ndenze 15 June 2025 | 9:14 Government of national unity (GNU) Economic Freedom Fighters (EFF) FILE: Newly sworn-in Cabinet ministers pose for a photo with Chief Justice Raymond Zondo and President Cyril Ramaphosa on 3 July 2024. Picture: GCIS CAPE TOWN - The Economic Freedom Fighters (EFF) say the Government of National Unity (GNU) has been a partnership of convenience and has failed, as the multi-party coalition enters a year since its establishment. This weekend marks a year since the GNU's statement of intent was signed by 10 parties to form the new government arrangement. While some consider the last 12 months year as being relatively stable, parties like the EFF are not happy with its performance, citing poor economic growth, growing unemployment and the delays in passing the recent budget. ALSO READ: • DA's Steenhuisen admits being in govt harder in reality than it appears from opposition benches • Steenhuisen says biggest surprise of past year is how well GNU partners stuck together • GNU at 1: Analysts believe not enough has been done to transcend party lines The GNU was formed in June last year after the May general election could not find a clear majority winner. The GNU, while still intact, has seen clashes over government policies like BBBEE and the Expropriation Act and the parties have still found no consensus with legal challenges before the courts. The EFF, which is not part of the GNU, said that the coalition of unlikely partners had been nothing but a series of failures. Spokesperson Sinawo Thambo: "Unemployment has increased, economic growth has stagnated - just now in the first quarter of 2025, the economy grew by 0.1% - there was a loss of 291,000 jobs and crimes statistics are continuously going up. So, there's nothing that has improved under the GNU government." He said that the recently passed budget, which was delayed by months due to disagreements over a value-added tax (VAT) and fuel levy increase, illustrated that it was nothing but a "government of convenience". "And the EFF is vindicated for that, and hopefully the people of South Africa will remember."
