Lwazi Bam, partner, corporate finance at Deloitte, says a number of multinationals announced last year that they would delay finalising their empowerment transactions until such time as the codes provide some clarity.

Those multinationals that were expecting blanket exemption for the ownership element of the empowerment scorecard will be very disappointed.

"In the latest draft of the codes it is stated clearly that multinational companies are expected to comply fully with the provisions of the codes on equity ownership.

"This means that multinational companies will be expected to sell a portion of their equity to qualifying black shareholders, the same as is required of South African companies," Bam says.

Only those multinationals that qualify for the very stringent exemption criteria can opt for the equity equivalent route, and they will only be exempt if they can prove the following:

?That the company is owned and controlled by a multinational company;

?That such company is subject to a global policy that prohibits the sale of equity to outsiders; and

?That it will suffer substantial commercial harm by selling equity to outsiders.

"For the multinational company to be able to opt for the equity equivalent route it has to prove all three, and many of the multinationals will not be able to qualify for exemption on this basis," Bam says.

"We are expecting that this will result in increased activity by these companies this year when trying to catch up with their South African counterparts."