Goog Lurie | May 21, 2025
History is a great teacher, and those who ignore it are destined to be.
Will South Africa create a new “Elon Musk regulation” if Starlink exempts it from broad Black Economic Empowerment (BBBEE) compliance?
The answer lies in understanding how American giants like IBM, Microsoft and Amazon are already following in order.
What is B-BBEE and why do multinational companies use stock equivalents?
The South African B-BBEE Act of 2003 aims to correct economic disparities in the apartheid era by promoting black ownership, skill development and corporate growth.
However, foreign companies are often unable to transfer direct ownership.
Instead, they will utilize equity equivalent programs approved by the Department of Trade, Industry and Competition (DTIC) to earn B-BBEE points.
Ownership Alternative: Instead of selling stocks, companies invest in skills development, SMME growth and infrastructure.
Government approval: The programme must be consistent with national policy (NDP, industrial policy) and approved by the Minister.
25 BBBEE Points: Companies earn full ownership points for approved initiatives.
Case studies: Microsoft, IBM, and Amazon
Microsoft R1.32 billion (2024)
Focus: Black-owned SMMES, 4IR skills, and R&D.
Impact: Supporting Tech and Non-Tech companies for over 10 years.
IBM's R700 Million Skill Development (2015)
Amazon Web Services (AWS) EEIP (2019)
Can StarLink use the equity equivalent?
If South Africa allows Starlink to operate through the EEP, that is not a new law. It is merely the application of existing B-BBEE mechanisms used by other US companies.
Important benefits of stock equivalents:
There is no dilution of stocks in multinational companies.
Promote local SMME and skill development.
It aligns with South Africa's economic goals.
Stock Equity Equivalence is a proven B-BBEE compliance tool for global companies. South Africa will not create an exception if Starlink is following the Amazon, IBM, or Microsoft path. Just enforce existing policies.
This is the following of the EEP, outlined by the Ministry of Trade and Industry in its 2022 presentation.
“Disclaimer – the views and opinions expressed in this article are the views of the author and are not necessarily those of the Bee Room.”
