Consultation continues

Von Samantha Perry

Following the release of the final draft of the BEE ICT Charter last week, the next phase of the charter process will see continued consultation with all stakeholders in order to resolve the outstanding issues.

Speaking at the announcement of the release of the final version and the launch of the interim, or pre-adoption, phase of the charter process, ICT Charter Working Group chairman, Dali Mpofu, says that while the latest version was marked as ?final?, it is by no means the charter itself. ?The document still has a number of outstanding issues,? he continues, ?but we have come a long way towards addressing the issues raised in the third and fourth drafts.?

This final draft document will be used as a base discussion document for clarifying and addressing outstanding issues, Mpofu adds.

The final draft features significant score card adjustments, Mpofu says. For example, the long-term (2015) and mid-term (2010) BEE direct shareholding targets are now both 30 percent, the previous long-term target of 35 percent having been reduced, due to the fact that, in terms of the Companies Act, 35 percent is the threshold for making an offer to minorities.

The issue of whether direct ownership by, and involvement of, disabled persons at a management and control level should be compulsory, or be counted as bonus points has been resolved, and ownership by disabled persons will now count towards bonus points to a maximum of 10 percent of the total score. Companies can also earn bonus points towards the enterprise development weighting by establishing and/or supporting enterprises in which disabled persons are involved.

?The document is not finished, but we think this is a better quality document and a much richer document, as it takes into account input from other stakeholders beyond those involved in earlier drafts,? he says. These stakeholders include the community and labor constituencies that made written submissions on the fourth draft, following a workshop held at Nedlac in late September.

Input has also been obtained from Icasa, specifically around issues of cross-jurisdiction, or double jeopardy, as some players have called it. Simply put, the BEE requirements imposed by Icasa in its licensing regimes, and BEE requirements imposed by existing legislation, need to be aligned with the charter and vice versa. A legal team, which has been instructed by the ICT Charter Working Group, is currently working with Icasa on auditing requirements and aligning definitions and other relevant provisions. In the event that this alignment has not been completed by March 1, 2005, Mpofu says that affected companies will be exempt from the charter?s provisions for a specified period, and these companies will only be governed by Icasa?s requirements during that time.

Further issues outlined by Mpofu at Tuesday?s press conference include: governance issues around the formation, running, funding and rules governing the BEE Council and clarification and expansion on the agreement reached with the multinationals around equity sales.

Where to for the multinationals?

American Chamber of Commerce (AmCham) President, Mark Harris, says that the multinationals will continue to work with the Working Group to clarify and expand on the issues around equity ownership. He notes that the scorecard and implementation of the scorecard is a very complex process, and that these issues are being looked at by the multinationals at a very high level.

?We are all supportive of the process, but some of the issues need clarification. I was asked to attend the Working Group?s workshop (held at Nedlac last Tuesday) in order to come up with a framework for taking the process forward to the first implementation in March. We are spending a lot of time ensuring that the charter is executable,? he adds.

Thoko Mokgosi, CEO of HP SA, echoes this sentiment: ?As a company we are passionate about broad-based economic empowerment, and believe that the SA ICT industry has an important role to play in empowerment. The process that is being followed with the development and implementation of the ICT Charter will go a long way to addressing the issues and providing guidelines for the future.

?As a multinational company listed on the New York Stock Exchange, the Pacific Stock Exchange and Nasdaq, and doing business in more than 170 countries around the world, we are guided by corporate objectives and regulations, and are working through the American Chamber of Commerce with regards to equity discussions,? she says.

The final version is currently available on