Tourism Aid: Court Rules B-BBEE Is An Illegal Criteria

The Court of Appeal in Bloemfontein on Wednesday ruled as unlawful that the Department of Tourism’s use of Broad-Based Black Economic Empowerment (B-BBEE) as criteria to financially assist struggling businesses in the sector.

Tourism minister at the time, Mmamoloko Kubayi-Ngubane, had insisted that support for distressed firms and establishments in the sector would be guided by empowerment (B-BBEE) codes – a move Solidarity and AfriForum opposed in court.

Judge Clive Plasket said the tourism minister committed an error of law and was not legally obliged, as she argued, to allocate funds based on B-BBEE requirements.

Mmamoloko-Kubayi has since been moved and is now the human settlements minister. Lindiwe Sisulu is the new tourism minister. 

Judge Plasket overturned a previous ruling, delivered on 6 April that was in favour of the tourism department using B-BBEE as criteria for dispensing financial assistance.

Solidarity and AfriForum appealed against the ruling and the case was heard electronically on 25 August.

Wednesday’s verdict together with a cost order was delivered against the tourism department.

“We are delighted with the verdict,” said Solidarity and AfriForum in a joint statement after the ruling setting aside B-BBEE as criteria for helping struggling tourism businesses affected by the Covid-19 pandemic lockdowns.

“It is a victory for everyone in the tourism sector who has lost their revenue and businesses as a result of the government’s implementations of the Disaster Management Act, but also whom the government has rejected based on the colour of their skin.”