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Draft Retailer Scorecard for the Petroleum Liquid Fuel Charter & Goodwill Discussions
Feedback from Meetings held on 17-18 January 2018
Dear SAPRA member & Petroleum retailer
Senior Petroleum Industry Retailers together with the SAPRA National Executive Committee, a BBBEE specialist, a legal expert and the Interim CEO of the Petroleum Liquid Fuel Charter met for a two day workshop in Pretoria on the 17th & 18th January 2018 to have early discussions/input on the draft Retailer Scorecard and further discussions on GOODWILL. We were fortunate to have senior retailers in the room from all six major Oil Companies together with independent wholesalers. For the goodwill discussions, the invite was extended to the DoE as well.
- Day One – Retailer Scorecard Discussions
The purpose of the meeting was to discuss the draft Retailer scorecard and provide an equitable opportunity at this stage for initial SAPRA & Industry comment.
Retailer Scorecard –The draft retailer scorecard was presented by the Interim Liquid Fuel Charter CEO, inviting delegates to make comment as and where necessary. There was substantial fundamental comment and changes made to the draft scorecard, all of which would be presented to the Petroleum Liquid Fuel Charter Steering Committee. The interim CEO clarified that all comment made in the workshop will be considered for adoption.
Out of the day’s session, a working group was formed with a primary objective to formulate a position paper highlighting the suggestions/changes proposed by the delegates, together with supporting empirical evidence and motivations. The exercise delved into the real-time practical & operational challenges faced by Retailers and then finding solution oriented and reasonable suggestions for the challenges identified in the draft Retailer Scorecard. Once the submission is finalised, it will be presented to the Petroleum Liquid Fuel Charter steering committee, anticipated date mid-February 2018.
The interim CEO will then, subject to our submission, put a process in place using empirical data to test physically with sampled retailers the application of the revised draft code to ensure that it is practical, fair & reasonable, implementable and sustainable.
Procedurally, SAPRA and the senior Industry delegates understand that a broader consultation process is necessary with retailers around the country. Accordingly the delegates agreed to, when ready, start roadshows to present the draft code, once accepted, to the broader industry. Communication and timelines on these roadshows will be circulated in due course. A specialist in the field of BBBEE will be engaged for the SAPRA & Retailer presentations around the country.
We understand that the DoE will also be conducting roadshows, ultimately we aim to align our Industry roadshows to the DoE roadshows. Thereafter a final draft submission will be presented to the DTI. A draft gazette will follow for broad public comment (60 day public participation period).
It was further agreed that our submission paper be shared with other stakeholders in the industry to ensure collaboration and consistency.
We want to reassure industry that the interest of SAPRA members & Retailers is being considered. Remember, the retailer scorecard is currently only in draft format and no sign offs have taken place.
- Day Two – GOODWILL Discussions
The purpose of the meeting was to deliberate on the topic of GOODWILL. An initial opinion prepared by a legal firm was presented by an attorney. Delegates in the room deliberated on many examples of how GOODWILL is applied in the industry. Various pieces of applicable legislation were also looked at. It was clear from the sentiments and deliberations in the room & Industry at large that something must be done to provide a clear perspective on GOODWILL as the practice, in its current format, cannot go on in perpetuity. Unjust enrichment cannot take place when a business is successful with the inverse not applicable when the same business fails.
Accordingly the legal team and steering committee have agreed to start further engagements with a view to arriving at a more palatable outcome, one that is fair and reasonable for all affected role-players.
At this point in time, we understand the critical importance of the topics above and will keep you posted on developments as and when they are available. Feel free to engage our offices if need be.
Vishal Premlall | Director | SAPRA – South African Petroleum Retailers Association
Tel: +27 (0) 11 886-6300 | Cell: 082 886 6392