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How will the Amended Property Sector BEE
Charter affect estate agencies? BEE

July 2017

“I am the head of a small local estate agency. We are doing
well and hope that our annual turnover will go over R3 million
this year. I’ve heard that an amended Property Sector BEE
Charter has been issued. What should I expect under this
charter and has the threshold for qualifying as an EME been
increased to above R2.5 million?”

The amended Property Sector Code for Broad-Based Black Economic
Empowerment (“Amended Property Charter”) was gazetted on 9
June 2017. The Amended Property Charter applies to the residential
and commercial property industry and also to property services such
as property management, broking companies, estate agents, and
property valuation professionals.
The amended Property Charter has to a large extent remained similar
to the previous Property Charter, however certain provisions, targets and
point allocation have been aligned with the more stringent Amended
Generic BEE Codes of Good Practice (“Generic Codes”).
With regards to eligibility as an EME, the amended Property Charter has
adjusted some of the thresholds. For asset based entities the threshold
is R80 million and R10 million for service based entities, however the
threshold has remained at R2.5 million for estate agencies, broking
companies and valuation companies. The QSE thresholds have been
adjusted to R400 million for asset based companies, R50 million for
service based companies, and R35 million for estate agencies, broking
companies and valuation companies.

The provisions contained in the Generic Codes relating to enhanced
recognition for EME’s and QSE’s have also now been incorporated into
the Amended Property Charter, with the effect that 51% black owned
EME’s and QSE’s automatically qualify as Level 2 contributors to BEE,
and 100% black owned EME’s and QSE’s as Level 1.

If your turnover exceeds R2.5 million, you will therefore have to report
under the QSE scorecard. Although you cannot elect which elements
to report under as with the previous Property Charter, provision is once
again made for divergent enterprises in the property sector that will
not be able to report under certain elements due to the nature of
the enterprise. For example, a property owning company usually has

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