B-BBEE affidavits and certificates for small bidders (EME and QSE)

Many government tenders ask for proof of your B-BBEE (broad-based black economic empowerment) status. Large businesses get it from a verification agency. Small businesses usually don't need to: an Exempted Micro Enterprise (EME), and a Qualifying Small Enterprise (QSE) that is at least 51% black owned, can use a sworn affidavit, and an EME can get a free certificate from CIPC. Here is how it works under the generic codes.

Which size are you?

• EME: annual total revenue of R10 million or less.
• QSE: annual total revenue between R10 million and R50 million.
• Above R50 million you are a generic enterprise and need full verification.

Revenue is based on your latest financial statements. These are the thresholds in the generic codes. Some sector codes use different ones, with their own affidavit templates: the tourism EME affidavit, for example, uses R5 million. Check whether your sector has its own code.

The levels

The dtic's EME affidavit template sets out the levels:

• 100% black owned: Level 1 (135% procurement recognition).
• At least 51% black owned: Level 2 (125%).
• Less than 51% black owned: Level 4 (100%).

A QSE can use the affidavit only if it is at least 51% black owned (Level 2), or 100% black owned (Level 1). A QSE with less than 51% black ownership must be verified by an accredited verification professional.

Option 1: a sworn affidavit

1. Download the right template from the dtic (the Department of Trade, Industry and Competition): the EME or QSE affidavit, general or for your sector. They are free.
2. Fill it in: the deponent's name and ID number, your role (member, director or owner), the enterprise name, registration number, address and type, the black ownership percentages (including black female and designated group ownership), your financial year-end and revenue, and tick your level.
3. Sign it in front of a commissioner of oaths, for example at a police station, who doesn't work for your business. Don't sign it beforehand.
4. Diarise the expiry. The affidavit is valid for 12 months from the date the commissioner signs it.

Option 2: a CIPC certificate (EMEs only)

CIPC issues B-BBEE certificates electronically, at no cost, to EMEs with annual turnover of R10 million or less. Apply through CIPC's e-services, BizPortal or a CIPC self-service terminal. Only directors or members can apply, and the company or close corporation must be in business with its annual returns and beneficial ownership filings up to date. The certificate is valid for 12 months. If you can't apply online, for example because a director is foreign, use the affidavit.

How tenders use it

Since the Preferential Procurement Regulations, 2022 took effect on 16 January 2023, preference points go to specific goals that each tender sets on its SBD 6.1 form, with the points for each and the proof required. B-BBEE status is a common goal, but not the only one, and some tenders use ownership by black people, women, youth or people with disabilities instead. Read the SBD 6.1 for each tender, and attach exactly the proof it asks for: if you don't, you are taken not to claim the points. See the SBD forms explained.

Common mistakes

• An expired affidavit or certificate (older than 12 months).
• Using the generic template when your sector has its own code.
• The affidavit not commissioned, or commissioned by someone who works for the business.
• Ownership percentages that don't match your CIPC records or share register.
• Claiming a level on SBD 6.1 the affidavit doesn't support. False claims can lead to disqualification and a ban from government business for up to 10 years.

Keep it current with Honde

On the Max plan, Honde keeps your B-BBEE, CSD and tax documents on file and reminds you before they expire, and lists what each tender needs before you start. Make sure you are registered on the CSD, then browse open government tenders.