Estate and rental agencies won’t need to have a minimum Black Economic Empowerment (BEE) certificate score when applying for a Fidelity Fund Certificate (FFC).
Earlier this year, agents were put on notice that the Property Practitioners Regulatory Authority (PPRA) would start requiring a compliant BEE certificate – meaning that non-exempt companies would need to score at least 40 BEE points as set out in the Amended Property Sector Code of 2017.
At the time, industry leaders warned that this could be impossible for many real estate firms. At the time, it was estimated that around 65% of agencies are sole proprietorships or small businesses, making it difficult for them to take on new managers or owners. And as estate and rental agents can’t trade without an FFC, the tougher BEE requirement could have forced firms out of business.
But following engagement with industry groups, the PPRA has confirmed that real estate businesses can keep doing what they are already doing. They must get a valid BEE certificate issued by a South African National Accreditation System (SANAS) accredited provider, but no minimum score is required.
Reactions from real estate
Industry group Rebosa engaged extensively with the PPRA on this issue, and its chief executive Jan le Roux welcomed the decision and said that “catastrophic consequences” had been avoided.
“We are also pleased to note that months of negotiations have borne fruit. It has long been our belief that coming together around the table would provide a much faster, cheaper, and less acrimonious result instead of heading straight to court,” added Le Roux.
But not everyone has been as receptive. Business group Sakeliga, which also lobbied against the PPRA on this issue, said that the most urgent threat had been taken away but is still going ahead with a broader court challenge to BEE requirements in the real estate sector. Sakeliga has called for the requirement for a valid BEE certificate to be scrapped too, arguing that it costs businesses around R10 000 per year.
