What is the Future of the Integrated Transport Sector Codes?

The Transport Sector has been left in a state of uncertainty over the last 8 years. All Sector Codes were required to align to the amendments made to the 2013 Codes of Good Practice. Despite the Draft Codes that went out in February 2016 no further guidance was provided to the industry.

With the Transport sector still operating off the Old 2009 Codes and with multiple iterations of promises of new Codes and false starts, it has been an extremely difficult and costly for Companies in the Transport sector to manage their B-BBEE scorecards efficiently.

What has changed:

Although we may be inclined to adopt a stance,“we’ll believe it when we see it”, the Transport Sector Council, has in recent months, made notable progress in updating and revising their Codes:

• The new Minister of Transport, Ms. Sindisiwe Lydia Chikunga was appointed in March 2023 and shortly after her appointment, she announced the Transport sector’s commitment towards the alignment and development of the Integrated Transport Sector B-BBEE Codes.
• The new B-BBEE Transport Sector Council was introduced to Transport Industry stakeholders at the B-BBEE Symposium held in May 2023.

What can we expect:

Council Initiatives:

Alignment sessions took place in Gauteng, from the 4th - 8th of September during which the Transport Sector Council unpacked proposed changes to the various sub-sectors scorecards and these changes could potentially have a significant impact on the trajectory of the Transport Sector company scorecards from a strategic planning and budgeting perspective. Some of the notable propositions were:

• Ownership: the introduction of EAP demographics into the Ownership element
• Management Control: the removal of the Junior Management Element

• Enterprise and Supplier Development: a targeted Integrated Transport Sector Enterprise and Supplier Development Fund and it is

  mandatory that a percentage (to be prescribed), must be contributed to the fund for the development of Black Owned enterprises in the Transport industry

• Socio-Economic Development:  contributions must attempt to include people in Rural Areas and townships and where possible be sector-specific sector.

Changes in Codes:

The new Codes are anticipated to be released for Public Comment in December 2023 and gazetted by March 2024, with no transitional period. We anticipate a significant shift in your BEE level as the new codes have taken into consideration some of the 2019 amendments and will include some interesting resolutions put forward by the Council. This means that companies in the Transport industry do not have much time and will need to act swiftly to manage their Transport scorecards and proactively align their BEE Strategy to incorporate the proposed changes. 

How to navigate your BEE scorecard in a changing landscape:

1. Planning is key
2. The New Codes are unlikely to have a transition period and will become immediately effective
3. Companies will need to manage their BEE strategies carefully, depending on their year-end and the effective date of new legislation
4. This means planning the BEE scorecard on existing Codes, but making provision to adopt potential new amendments
5. Remain up to date with changes; speak to your consultants to stay abreast of developments; develop a BEE strategy that meets the Transport Sector transformational objectives, regardless
6. Build flexibility and risk management into your BEE strategy
7. Understand the potential impact the new Codes could have on your BEE budget and BEE contributor status

Contact us today and let us help you transcend your B-BBEE journey.