Issue Date: 
Monday, April 25, 2016

Tenders and Subcontracting

Tenders and subcontracting go hand in hand. In fact, subcontracting part of a tender is so commonly placed that in South Africa there are specific rules regulating subcontracting in executing tenders. This is especially true for South African Government tenders.

According to Investopedia subcontracting is the practice of assigning part of the obligations and tasks under a contract to another party known as a subcontractor. Subcontracting is especially prevalent in areas where complex projects are the norm, such as construction and information technology. Subcontractors are hired by the project's general contractor, who continues to have overall responsibility for project completion and execution within its stipulated parameters and deadlines.
It is very important to know that in South Africa there is one major rule when it comes to subcontracting if awarded a Government tender. 

According to the Preferential Procurement Regulations, 2017:

  • Section 6(5) states that a person must not be awarded points for B-BBEE status level if it is indicated in the tender documents that such a bidder intends sub-contracting more than 25% of the value of the contract to any other enterprise that does not qualify for at least the points that such a tenderer qualifies for, unless the intended subcontractor is an exempted micro enterprise that has the capability and ability to execute the sub-contract.

This sub-section of the Preferential Procurement Regulations, 2017clearly indicate that you cannot subcontract more than 25% of the contract value to another party if that party does not have at least the same B-BBEE Status Level as you or a better B-BBEE Status Level than you. The Office of the Chief Procurement Officer is on the lookout for discrepancies like this. If you are in contravention of these regulations you stand the change that the contract may not be awarded to you or that your existing contract can be cancelled. You can also be liable for costs incurred by the Government Entity in executing the contract.

If you are going to subcontract less than 25% of the value of the contract you are save and you don't have to worry about the B-BBEE Status Level of the subcontractor.

Subcontracting don't need to be difficult but if you want to know more about subcontracting and other important tender response information we suggest you attend our How-to-Tender workshops that we present Country wide. Please email us at werner@how2tender.com should you be interested in attending one of these workshops.
 
Learn to earn

Title Closing Date Tender No.
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Tenders are invited for Water Quality Testing in Kings Beach as per specification available at SCM Acquisition Offices, Harrower Road, North End, PE 2019-08-01 11:00 CSQ07191683
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Biometrics 2019-07-29 12:00 10JUL19
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Training Services: Renewable Energy Capacity Building Programme 2019-08-23 15:00 AUC/IED/C/060
Request for quotations for the supply, delivery and ofloading of food & beverages at various stores (Main Reef & Randburg stores) 2019-07-29 10:30 SJ0001/20
Provision of catering services as per approved Sharks Stadia supplier list for Transnet SOC Limited (Reg. No 1990/000900/30) operating as Transnet Port Terminals (hereinafter referred to as “TPT”) for Transnet Port Terminals Head Office on an as and when required basis for a period of twelve (12) months. 2019-07-29 10:00 iCLM HQ 346/TPT
Provision for the supply of Microsoft Windows Server 2016 standard edition licenses 2019-07-26 13:00 EWSETA/RFQ/28/2019
Provision of Event Management for Service Excellence Awards 2019-08-06 13:00 RFQ:24694
Delivering of Minimum Municipal Competency Levels Training (MFMP) for a period of one year for a maximum of 10 (ten) candidates 2019-08-08 12:00 NC065/T17/2019
ADVERTISED RFQ 06/07/19: Request for quotation for primary emergency care/first aid level 1 training for 80 employees NQF Level 2 (once off) 2019-07-26 12:00 ADVERTISED RFQ 06/07/19
Appointment of a service provider to offer training on enterpreneurship skills to graduates for period of 36 months 2019-08-09 11:00 NRF/SAASTA/03/2019-2020
Appointment of a service provider to offer training on life skills to graduates for a period of 36 months. 2019-08-09 11:00 NRF/SAASTA/02/2019-2020
Paving of internal streets at Maviljan Phase 5 2019-08-20 12:00 MIG/MP1755/RST/19/20
Paving of internal streets at Matsikitsane Phase 1B 2019-08-20 12:00 MIG/MP1682/RST/18/19
Paving of internal streets at Dwarsloop Phase 1B 2019-08-21 12:00 MIG/MP1680/RST/18/19
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Tender Training

By Werner van Rooyen

www.howtotender.co.za

31 January 2019

People often ask me how I know so much about tenders and the completing of tender documents. The answer is easy; training. I believe that we must always try to train as much as possible. The more training you will do the better you will get at responding to a tender. Gary Player, one of South Africa’s best golfers of all time, used to say: “The more I practice, the luckier I get.”

That is the whole point of training. The... Read More

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