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.
Supply: Tunic, Man’s (Qty 2150 ea), Trousers, Men’s (Qty 2050 pr), Shirts, Man’s; Tropical (Qty 5000 ea). 2018-04-17 11:00 SPSC- B- 052- 2017
Request for proposal to dispose Office Furniture and Equipment for GPAA. 2018-03-16 11:00 GPAA 04/ 2018
Request for proposal to dispose ICT equipment for GPAA. 2018-03-16 11:00 GPAA 03/ 2018
Request for proposal for the appointment of a service provider to project manage the Design@50 skills development programme 2018-03-15 11:00 GGDA/ 17/ 2017- 18/ GIDZ_DESIGN@ 50
Sales of vehicles: Colesberg Management Area: Correctional Centre: Once -off 2018-03-09 11:00 COBQ 01/ 2018
Supply, delivery & installation of palisade fencing at Tshabo RED Hub 2018-03-16 11:00 SCMU 12 – 2017/18
The objective of this bid is to appoint a service provider to conduct research within the wholesale and retail sector to update the current SSP. 2018-03-16 11:00 SSP/ 2018/ 0004
The objective of this bid is to appoint Accredited Training Providers and TVET Colleges to up skill and train 220 18.2 members from 10 Cooperatives within the Northern Cape and 10 within the North West Provinces on W&RSETA Skills Programmes. 2018-03-16 11:00 RDO/ 2018/ 0010
Drivers License Training Programme 2018-03-27 11:00 ZNB 1413/ 18 T
The purpose of this bid is to invite Accredited Training Providers to train and up skill 550 18.2 learners identified within the AmaNdlambe AkuGompo Villages, AmaHleke Villages and Ten Traditional Councils within Nqgushwa Local Municipality. 2018-03-16 11:00 RDO/ 2018/ 0008
The objective of this bid is to appoint and contract Accredited Training Providers and TVET Colleges with Accreditation and/or scope with the W&RSETA to offer W&RSETA Unit Standards. 2018-03-16 11:00 RDO/ 2018/ 0009
Pretoria: Bryntirion Heritage: Construction of gate 1 and 2 as well as the Dog Unit 2018-03-27 11:00 Pt18/ 005
The South African National Roads Agency SOC Limited (SANRAL) invites tenders for the appointment of individual entities or groups of service providers consisting of a bank(s) as well as System Operators to enter into an agreement to provide banking services to SANRAL. 2018-03-23 14:00 NRA
Repair and Renovation to existing Community Library in Barkley West 2018-03-26 11:00 DRPW 044/ 2017
Provision of travel management services at SANAS for a period of 36 months 2018-03-09 11:00 SANAS/ TRAVEL/ 2017- 18/ 02
Department of Labour: Procurement of alternative Office accommodation comprising 2 533.64m² and 20 Parking Bays in Germiston CBD for a period of three (3) years 2018-03-16 11:00 JHB.17/ 41
Request for proposals from property management companies or landlords to lease office space in the Midrand area. 2018-03-16 11:00 RFP/ SASSETA/ 1718006
Appointment of a service provider for the infrastructure / refurbishment / construction including consequential general building, electrical, mechanical, civil and engineering works at DHA offices and Ports of Entry for a period of three (3) years 2018-03-16 11:00 DHA05- 2018
Rendering of security service to the Northern Cape Department of Sport, Arts and Culture. 2018-03-16 11:00 NCDSAC- 004- 2017
Re-Advert - Appointment of a CIDB registered contractor for the construction of a technology laboratory building at the University of Venda 2018-03-02 11:00 019- 2017/ 2018

Pages

Tender adjudication process

The SBD/WCBD6.1 document must form part of all bids invited.  It contains general information and serves as a claim form for preference points for Broad -Based Black Economic Empowerment (B -BBEE) Status Level of Contribution, and explains how tenders or bids are decided.

The document says:

  • The bidder obtaining the highest number of points will be awarded the contract.
  • Preference points shall be calculated after prices have been brought to a comparative basis.
  • Points scored will be rounded off to two decimal places... Read More
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