B-BBEE for a New Small Business: The Affidavit Most Companies Actually Need

Almost every small business owner has, at some point, been asked for a "B-BBEE certificate" by a customer, a bank, or a tender document — and almost every small business owner initially assumes this means registering somewhere and paying for something. For the overwhelming majority of new, small South African companies, it means neither. It means completing a sworn affidavit, correctly, and understanding which category your company actually falls into.

The three size categories that determine everything

B-BBEE status under the Codes of Good Practice is determined by annual turnover, split into three tiers:

• Exempted Micro Enterprise (EME) — annual turnover of R10 million or less. This covers most genuinely small and early-stage companies, and comes with the lightest compliance burden by far.
• Qualifying Small Enterprise (QSE) — annual turnover from above R10 million up to R50 million. A meaningfully heavier compliance category, generally requiring a full scorecard assessment.
• Generic (large) enterprise — turnover above R50 million, subject to the full five-element scorecard (ownership, management control, skills development, enterprise and supplier development, socio-economic development) verified by a SANAS-accredited agency. Most new companies are nowhere near this tier, but it is worth knowing it exists as the ceiling the other two categories sit below.

If you're an EME: the sworn affidavit is genuinely all you need

A company below the R10 million turnover threshold does not need an expensive verification process. What it needs is a sworn affidavit — a signed declaration, sworn before a Commissioner of Oaths (many banks, police stations, and attorneys' offices offer this service, often at no or minimal cost), stating the company's annual turnover and the percentage of black ownership. That affidavit is renewed annually, since B-BBEE status is assessed on a rolling basis tied to the company's current turnover and ownership, not a one-time fact fixed at incorporation.

An EME's B-BBEE level depends on its ownership, not an assessment of its operations:

• Any EME, regardless of ownership, is automatically a Level 4 Contributor, carrying a 100% B-BBEE procurement recognition level.
• An EME that is 51% or more black-owned is elevated to Level 2, carrying a 125% recognition level.
• An EME that is 100% black-owned is elevated further to Level 1, carrying a 135% recognition level — the best status available under the Codes.

This matters commercially: a customer procuring from your company can claim your recognition level against their own B-BBEE scorecard, which is precisely why so many businesses ask for this document before they will do business with a supplier at all — it is not idle paperwork on their end, it feeds directly into their own compliance numbers.

If you're a QSE: the picture changes, unless ownership rescues you

Once turnover crosses R10 million, the default requirement becomes a genuine scorecard verification by an accredited agency — a materially bigger undertaking than a sworn affidavit, assessing the business across several of the same elements a large enterprise is measured on, just with somewhat lighter targets. This is a real cost and time commitment worth budgeting for once a company is approaching the threshold, not something to discover for the first time when a customer asks for the certificate.

The significant exception: a QSE that is itself majority black-owned (51%+, and especially 100% black-owned) is generally treated the same way an EME is — a sworn affidavit rather than a full verification, with the corresponding elevated automatic level. This is a deliberate feature of the Codes, not a loophole: it removes the verification cost burden specifically from the black-owned small businesses the framework is designed to support, while still requiring it of QSEs that don't qualify for that treatment.

What this is not: a licence, a registration, or a legal requirement to trade

B-BBEE compliance is not compulsory in the way that, say, VAT registration above a threshold is — a company can trade perfectly legally with no B-BBEE documentation at all. What changes is who will do business with you and on what terms: government tenders and many corporate supply chains require a current affidavit or certificate as a condition of participating, and even where it isn't a hard requirement, a low B-BBEE level can be a genuine commercial disadvantage when competing against a similarly-priced supplier with a better one. Treat it as a commercial document you'll be asked for, not a legal obligation you're at risk of breaching.

Getting the affidavit right the first time

• Use your actual, current annual turnover — not a projection, not last year's figure if the company has since grown past a threshold. Getting this wrong on a sworn document is a real problem, not a technicality.
• Know your ownership percentages precisely, including how they're structured — a company held through a trust or another company has to trace ownership through to the natural persons behind it, exactly as the beneficial-ownership filing covered elsewhere in this series requires. Keeping these two records consistent with each other is worth checking, since a mismatch between what your B-BBEE affidavit claims and what your beneficial-ownership filing shows is the kind of inconsistency a corporate customer's compliance team can and does catch.
• Renew it annually, not only when someone asks — an expired affidavit found during a tender submission deadline is a bad time to discover the requirement.
• Watch your turnover as it approaches R10 million — this is the point to start budgeting for a QSE verification rather than being caught by the higher requirement mid-year.

Sources: the dtic's B-BBEE Codes of Good Practice (Exempted Micro Enterprise threshold of R10 million annual turnover; automatic Level 4 Contributor status at 100% recognition, elevated to Level 2 at 125% for 51%+ black ownership and Level 1 at 135% for 100% black ownership; Qualifying Small Enterprise band from above R10 million to R50 million; QSE scorecard verification requirement, with the affidavit-based exception for majority black-owned QSEs). This is general information, not legal or compliance advice — a company close to a threshold, with a complex ownership structure, or preparing a specific tender submission should confirm current requirements with a B-BBEE verification professional.

A worked example

A two-person consultancy turns over R3.2 million in its first full year, wholly owned by its two black South African founders. As an EME (well under R10 million) that is 100% black-owned, it completes a sworn affidavit — a free or near-free process at a Commissioner of Oaths — declaring its turnover and ownership, and is automatically a Level 1 Contributor at 135% recognition, the best status available under the Codes, at essentially no cost. Contrast this with a company of similar size that is 100% foreign-owned: still an EME by turnover, still only needing the sworn affidavit, but landing at the default Level 4 (100% recognition) rather than Level 1 — the same simple process, a different outcome, driven entirely by ownership rather than anything about how the business operates.

Frequently asked

Do I need to pay a consultant to get my B-BBEE affidavit? No — an EME's sworn affidavit is a self-completed, self-declared document sworn before a Commissioner of Oaths, not something that requires a paid verification agency. Consultants and verification agencies become relevant once a company is a QSE (or larger) and needs an actual scorecard assessment.

How long is a B-BBEE affidavit valid for? Affidavits are generally treated as valid for 12 months from the date sworn, after which a new one reflecting current turnover and ownership should be completed — B-BBEE status is not a permanent, one-time classification.

What happens if my turnover grows past R10 million during the year the affidavit is valid? Your actual current status is what matters for compliance purposes, even mid-cycle — if your business has genuinely moved into the QSE band, continuing to present an EME affidavit that no longer reflects reality is a problem waiting to surface, typically at the worst possible moment (a tender audit or a customer's own compliance check).

Can a sole proprietor or partnership get a B-BBEE affidavit, or only a registered company? The EME affidavit framework applies to any enterprise, not only registered companies — a sole proprietorship or partnership below the turnover threshold can complete one on the same basis.

Is there a CIPC-generated alternative to the sworn affidavit? Some smaller entities can also generate a basic B-BBEE certificate through CIPC's own systems as an alternative route for straightforward EME cases — worth checking directly with CIPC or a B-BBEE practitioner for your specific entity type, since the sworn affidavit remains the most universally accepted and straightforward option for a new small company.