Issue Date: 
Tuesday, July 31, 2018

3 Sub-contracting rules to be aware of when responding to tenders

There seems to be a lot of confusion amongst entrepreneurs when it comes to tenders and sub-contracting, due in large part to The Preferential Procurement Regulations, 2017 that has been implemented on the 1st of April 2017. Many entrepreneurs ask us whether they should sub-contract or not, in responding to a tender and how and where do they get onto the sub-contracting lists.

There are 3 sub-contracting rules in the Preferential Procurement Regulations 2017 that Organs of State can/must apply when issuing tenders to the general public.

The first Regulation is Regulation 4 which state inter alia: if an Organ of State decides to apply pre-qualification criteria to advance certain designated groups that Organ of State must ADVERTISE the tender with a specific tendering condition that certain bidders can or may respond.

The second Regulation is Regulation 9 which state inter alia: if it is feasible to sub-contract for a contract above R30 million, an Organ of State must apply sub-contracting to advance designated groups.

The designate groups mentioned in both Regulation 4 and 9 are Black Owned Enterprises with 51% or more black ownership and any of female Black owned, youth black owned, black people with disabilities owned or black military veterans owned enterprises.

The third sub-contracting rule has to do with sub-contracting after the award of the tender. Regulation 12 states inter alia: (3) a person awarded a contract may not subcontract more than 25% of the value of the contract to any other enterprise that does not have an equal or higher B-BBEE status level of contributor than the person concerned, unless the contract is subcontracted to an EME that has the capability and ability to execute the subcontract.

The tender document will dictate how you should or should not sub-contract. Read the tender document carefully; follow the instructions precisely and to the point. Organs of State are applying these Regulations rigorously and failing to comply will lead to your tender response being disqualified.

Tender trends and Regulations are changing frequently. To keep up to date with these changes we recommend attending one of our How-to-Tender workshops that are presented across South Africa. Tender Workshop dates are published on our website at www.how2tender.com or for more information on the How-to-Tender workshops please email us at werner@how2tender.com

This article was written by Werner van Rooyen, Director of HowToTender which specializes in tender consulting and tender training.

Title Closing Date Tender No.
Appointment of a panel of debt collectors for PSiRA for a period of 3 years. 2018-09-19 11:00 RFB/ 2018/ PSiRA/ 06
The Province of KwaZulu Natal, Department of Transport, invites tenders from Vukuzakhe Contractors. Tenderer must be registered as grade 3 CE only with the CIDB in the Civil Engineering class of construction works 2018-09-14 11:00 ZNT373T/ C235/ 1100/ S/ 3
Appointment of a technical assistant to undertake an economist/education planner role on The Eastern Cape Department of Education (ECDoE) Schools Rationalisation Project. 2018-09-07 11:00 GTAC 022- 2018
The Province of KwaZulu Natal, Department of Transport, invites tenders from Vukuzakhe Contractors. Tenderer must be registered as grade 3 CE only with the CIDB in the Civil Engineering class of construction works 2018-09-14 11:00 ZNT373T/ C235/ 1100/ S/
Purchase of a Lowbed Trailer 2018-09-07 11:00 ZNB0003/ 18
The appointment of service provider for rendering of general cleaning services for surveyor-general: Cape Town for a period of thirty six (36) months for number 90 Plein Street, Part 8th floor, 9th & 10th floors. 2018-09-07 11:00 SSC WC 09 (2018 / 2019) DRDLR
The Province of KwaZulu Natal, Department of Transport, invites tenders from Vukuzakhe Contractors. Tenderer must be registered as grade 3 CE only with the CIDB in the Civil Engineering class of construction works 2018-09-19 11:00 ZNT373T/ C237/ 1200/ S/ 9
Appointment of a suitable service provider for the management of SAP hosting service for a period of two (02) years. 2018-09-17 11:00 NHBRC 03/ 2018
The Province of KwaZulu Natal, Department of Transport, invites tenders from Vukuzakhe Contractors. Tenderer must be registered as grade 3 CE only with the CIDB in the Civil Engineering class of construction works 2018-09-19 11:00 ZNT373T/ C237/ 1200/ S/ 5
Request for proposals for the appointment of a suitable service provider on a panel to conduct consulting service in the built environment for a period of three (03) years 2018-09-19 11:00 NHBRC 01/ 2018
The Province of KwaZulu Natal, Department of Transport, invites tenders from Vukuzakhe Contractors. Tenderer must be registered as grade 3 CE only with the CIDB in the Civil Engineering class of construction works 2018-09-19 11:00 ZNT373T/ C237/ 1200/ S/ 10
Appointment of a service provider for technical and functional support for the implemented SAP solution for a period of three (03) Years. 2018-09-17 11:00 NHBRC 02/ 2018
Appointment of Service provider to Develop and Implement an Enterprise Resource Planning System for the MQA. 2018-09-19 11:00 MQA/ 05/ 18- 19
Minor Structure Repairs on P272 2018-09-17 11:00 C252/ 1718/ MS/ 592
Upgrade of Main Road P16-3 from KM28+200 to KM33+800 - CIDB Grading 8CE 2018-09-13 11:00 ZNT3656/ 15
Appointment of service providers for the supply and delivery of branded promotional material/items to INSETA. 2018-09-11 11:00 Proj/ 2018/ 07
Pretoria: Bryntirion, Construction of Roads, Stormwater, Water Reticulation and Sewer on Western side and Central area of the Bryntirion Estate 2018-09-18 11:00 PT18/ 025
Servicing of heat pumps 2018-08-24 11:00 ZNQ58/ 18/ 19
Appointment of a service provider to provide job profiling, grading and remuneration survey/bench marking services. 2018-08-27 11:00 RFQ/ 2018/ 63
Servicing of sewer pump 2018-08-24 11:00 ZNQ68/ 18/ 19

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