Issue Date: 
Tuesday, November 1, 2016

When Must I Sub-Contract?

There seems to be a lot of confusion amongst entrepreneurs when it comes to tenders and sub-contracting. The Draft Preferential Procurement Regulations, have been gazetted and are currently up for review. However, these Regulations are the major cause for the confusion. Many entrepreneurs ask whether they should sub-contract or not whilst responding to a tender.

The Draft Preferential Procurement Regulations stipulates the following: 

  1. For contracts above R30 million, the tenderer MUST sub-contract a minimum of 30% of the value of the contract to –
    • One or more of the categories:
      • EME’s (Exempt Micro Enterprises) or QSE’s (Qualifying Small Enterprises) owned by black people who are female;
      • EME’s or QSE’s owned by black people from the ages 14 to 35;
      • EME’s or QSE’s owned by black people;
      • EME’s or QSE’s owned by black people with disabilities)
    • One or more Exempt Micro Enterprises (EME’s) or Qualifying Small Enterprises (QSE’s); or
    • One or more small businesses, as defined in the National Small Business Act.
  2. If a successful tenderer sub-contracts to another person without disclosing it in its tender documents, the organ of state must penalise the tenderer 10% of the value of the contract, unless the tenderer submits a satisfactory reason for failing to make the disclosure.

The Regulations are very clear because its states “the tenderer MUST sub-contract…..”. Thus, once the Regulations are finally gazetted then all contracts with a value of R30 million and above will have to comply with this Regulation. Remember that currently (as of 31 Oct. 16) the Regulations are not finalized yet.

Until such time that the Regulations are finalized the answer is easy whether or not to sub-contract – look at the scope of the tender or the special conditions. Somewhere in the tender document it will stipulated whether or not the tenderer will have to sub-contract.  Follow those rules. If the tender document doesn’t contain any sub-contracting instructions (at this stage) then it is not necessary to do so.

The fact is that the tender document will dictate what you should or should not do. Read the tender document carefully and follow the instructions to the point.

To learn more about this and all the other new developments regarding tenders, attend one of the How-to-Tender workshops.

Learn to earn

www.how2tender.com

Title Closing Date Tender No.
Appointment of Service Provider to Supply office Automation (Printing/Copying) Equipment and Associated Services to Emvelo Kzn Wildlife for a period of three (03) years 2017-08-21 11:00 EKZNW 20/ 2017
Supply and delivery of Hotelier Beds [as and when required] to Ezemvelo KZN Wildlife Resorts for a period of three (03) years 2017-08-21 11:00 EKZNW 14/ 2017
Supply, delivery and installation of photocopiers at Electoral Commission [IEC] Local Offices, South Africa 2017-08-11 11:00 0010359775
Supply, delivery and installation of office furniture - Electoral Commission Local Offices throughout South Africa 2017-08-11 11:00 0010360455
Bandages - Adhesive Plaster - Size: 50mm X 4.5mt Long. as per specification 2017-08-01 11:00 ZNQ 538/ 17 - 18 GAZ
Bandages - Plaster of Paris - Size: 200mm X 3.5mt. as per specification 2017-08-01 11:00 ZNQ 536/ 17 - 18 GAZ
Bandages - Crepe - Size: 100mm X 4.5mt. as per specification 2017-08-01 11:00 ZNQ 534/ 17 - 18 GAZ
Bladeless Atraumatic Trocar With Stability Sleeve - Size: 12mm 2017-08-01 11:00 ZNQ 531/ 17 - 18 GAZ
Karman Cannulae with Adaptor 2017-08-01 11:00 ZNQ 529/ 17 - 18 GAZ
Linear Cutter - 75mm. 2017-08-01 11:00 ZNQ 521/ 17 - 18 GAZ
Adhesive Dressing - Absorbent/ Water Proof / Fluid - Size 25cm X 10cm 2017-08-01 11:00 ZNQ 520/ 17 - 18 GAZ
Laproscopic Reload - Sterile - Latex Free as per specification 2017-08-01 11:00 ZNQ 530/ 17 - 18 GAZ
Neonatal Splint - Size: +- 8 to 9 Cm in Length and 2.5cm to 3cm Wide as per specification 2017-08-01 11:00 ZNQ 526/ 17 - 18 GAZ
Ultrasonic Dissecting Instrument (Focus) as per specification 2017-08-01 11:00 ZNQ 525/ 17 - 18 GAZ
Atraumatic Graspers - 5mm - Length 36cm - Reusable 2017-08-01 11:00 ZNQ 524/ 17 - 18 GAZ
Curved Cutter / Stapler - Size: 3.0mm Length X 3.5mm Height 2017-08-01 11:00 ZNQ 523/ 17 - 18 GAZ
Modified Bipolar Vessel Sealing Device, Single Use -Small Jaw. as per Specification 2017-08-01 11:00 ZNQ 522/ 17 - 18 GAZ
Tubing, Latex (205) as per specification 2017-08-01 11:00 ZNQ 398/ 17 - 18 GAZ
Ligasure Impact Tissue Fusion - Open Instrument - Size: 13.5mm. as per specification 2017-08-01 11:00 ZNQ 355/ 17 - 18 GAZ
Catheter - Argyle - 40cm - Size 22g, as per specification 2017-08-01 11:00 ZNQ 299/ 17 - 18 GAZ

Pages

Functionality and Tenders

In all competitive bids (tenders) you as the bidder will have to respond to Functionality. You will need to score a set minimum number of points, measured as a percentage, on Functionality of a competitive bid (tender) in order to advance to the next phase of evaluation in the tender process.

Usually Organs of State evaluate competitive bids (tenders) as follows:

  • The tender response is evaluated on Functionality where the bidder must score points out of a maximum of 100 points.
  • A threshold of between 65 to 75 out of 100 points... Read More
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