The ICT sector is no closer to having its Sector Codes of Good Practice gazetted, says the Department of Trade and Industry (DTI).
Following concerns raised by the electronics sector, the DTI has instructed the steering committee to return with a "collective" draft.
The ICT empowerment charter steering committee submitted a draft in March - saying a majority decision had been taken and that the committee had resolved to move forward with the process.
However, the decision to take a majority vote has backfired. Director for BEE at the DTI Thabo Masombuka says the charter has been referred back to the committee due to threats by the electronic sub-sector to withdraw its support of the charter.
"We received the ICT charter from the committee and we did have a look at it. We then got an indication from the unhappy sector - the electronics sector - stating they are unhappy with the charter. We set up a meeting and they raised their issues."
The chairman of the steering committee, Norman Munzhelele, previously stated the final three out of the four represented sectors had agreed to the final draft. One sector had requested a revised board and decreased BEE targets.
Masombuka says the DTI could not grant the sector its request to review the steering committee, saying it "had to be driven by the industry".
He notes it`s vital that the electronics sector consents to the sector codes. The implication of having a "prominent stakeholder" refusing to be bound by the charter has serious consequences for transformation, he explains.
"As custodians of this process, we cannot go ahead with the process if it harms BEE and the transformation process. We won`t rush this through."
Way forward
As custodians of this process, we cannot go ahead with the process if it harms BEE and the transformation process. We won't rush this through.
Thabo Masombuka, director for BEE, DTI
The ICT sector`s broad-based black economic empowerment framework has been a contentious issue for several years. Industry opened consultations on the development of the charter in 2003, resulting in four drafts and three "final" versions during the last few years, which had subsequently seen additional amendments.
Most recently, the sticking point has been the inclusion of a R7.5 billion cap on ownership, which would lower the barrier of entry for BEE companies. Deals with a value of at least R7.5 billion would then be judged to be in compliance with the codes.
Masombuka says the committee has suggested a study to deal with this "fundamental disagreement". The DTI has agreed, saying reasons for disagreements need to be looked at and credible information on the delays needs to be found.
The final product, Masombuka says, will have to be "sector codes which reflect a collective consensus, which deals with the specific transformation targets and seeks to empower black people".
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