Companies with better BEE credentials will have an advantage in securing valuable export permits to the EU market, as the department of agriculture makes empowerment status a primary criterion in allocating 2026 agricultural export quotas worth more than R1bn.
The shift means a wine producer with level 2 broad-based BEE status could now win quota allocation over a competitor with identical export volumes but level 6 status.
For the first time, transformation credentials carry equal weight to traditional performance metrics in the government’s preferential market access permit allocation system.
The department of agriculture in a gazette in January stipulated that broad-based BEE status, measured against the AgriBEE sector code, will be factored alongside historical market share and export volumes when dividing permits for products ranging from wine to sugar to processed fruit under the Sadc-EU economic partnership agreement.
The allocation formula considers five variables, with broad-based BEE status listed first: transformation credentials, past three years of export volumes, quantity requested, number of applicants and total quota available.
This weighting structure means companies can potentially offset lower historical volumes with superior BEE scores.
Exempted microenterprises with turnover under R10m automatically receive level 4 broad-based BEE status and only need sworn affidavits.
Qualifying small enterprises earning R10m-R50mand majority black-owned firms also avoid costly verification processes, submitting affidavits instead of certificates from South African National Accreditation System-accredited agencies.
Large enterprises exceeding R50m turnover face the strictest requirements, mandating full broad-based BEE verification regardless of ownership.
The government reserved authority to further adjust allocations midyear if utilisation proves unsatisfactory, introducing additional uncertainty for exporters.
It can also modify formulas if any company’s market share approaches competition law thresholds.
“The quotas allocated to exporters will be provisional. The department will assess the utilisation rate during the quota year after which there will be reallocation,” said the gazette.
“The communique regarding the reallocation will be posted on the wine online system homepage. Applicants will be expected to motivate in order to avoid deduction in their allocated quota. No new applications will be accepted during this period.
“Despite any provisions in other laws, applicants registered as joint ventures, mergers, consortiums, holding companies or other similar business arrangements are not allowed to apply separately from their subsidiaries, minority shareholders or divisions for the same product, as this will create an unfair advantage towards other applicants.”