Hi Laurette and Jan,
Thank you for your response. We are a small black real estate agency and have been operating since October 2011. Before this, my wife has been an estate agent since 2003, and has obtained a FFC every year since. I am a full status estate agent (Professional Practitioner in Real Estate) and my wife is the Principal Estate Agent (Master Practitioner in Real Estate). We have consistently aimed to comply with legislative and professional development requirements in our industry, such as the Estate Agency Affairs Acct, the NCA, FICA, SARS and other compliance requirements. We wholeheartedly support the professionalization of the industry and reasonable compliance measures by a regulatory authority, such as the EAAB to regulate the conduct of estate agents for the benefit of consumers.
We were randomly selected and have just completed an EAAB self assessment in February 2017 for the EAAB and submitted all relevant documentation requested – this was really an audit. After obtaining 2 reference numbers from the 087-285-3222 EAAB call centre, I am still trying to even get the EAAB Audit Department to acknowledge receipt of the self-assessment and documents!
In June, through our auditor, we also successfully submitted 2017 year-end unqualified audit reports and financials statements to the EAAB which were due by June 30th, 2017. Again, we comply with training, CPD requirements, and all other requirements diligently. We diligently pay VAT, PAYE, and provisional taxes when required. We keep diligent trust, FICA, and financial records. At significant cost, we source the most professional legal, accounting and auditing firms to ensure we comply.
Yesterday, we left the public participation forum very dejected and demotivated about the viability of our small business in the real estate sector. We did not get the sense that the public participation process would yield concessions from the Department of Human Settlements on the proposals or that the moderators were listening, as the moderator was merely defending and rationalizing the implementation of the proposals and the proposed legislation. But, the fact remains that the proposed additional compliance requirements will place an onerous financial and administrative burden on our company, should it be enacted, specifically:
- BEE Certificate requirement (which I know will require reporting, management of BEE ownership, management, skills development metrix and the cost of obtaining it and possible exclusion from obtaining a future FFC if we don’t comply);
- 10 year financial records retention;
- Tax Clearance Certificates (If for any reason we can’t obtain one in a given year, an FFC will not be issued – this has been our experience with an unresponsive EAAB bureaucracy)
As it is, the economy has made trading conditions difficult in our industry. After yesterday’s session, it was the first time we analysed and realized that our small black real estate business will not be sustainable or profitable should these additional compliance requirements come into effect. We are not going to grow (hire real estate agents and administrative staff) until we fully understand the impact of this legislation. Conversely, we will likely close down and employ our skills elsewhere should some of these additional requirements come into effect, before these requirements close us down.
Maybe this is exactly the objective of this legislation. In spite of government’s lip service to small business development, it is the intention to close down small real estate agencies through these additional measures under the guise of compliance.
Regards,
Richard Stevens
