Tenders, B-BBEE and the new Preferential Procurement Regulations 2017

Having a good B-BBEE status level is VERY IMPORTANT in the tender process!

All tender documents will have the NEW Standard Bidding Document 6.2, which is used to claim your Preference Points for B-BBEE. The higher your B-BBEE status level, the more points you will score on the Preference Points System. Ultimately the bidder or bidders scoring the highest points will be awarded the tender.

New Preferential Procurement Regulations 2017 for Tenders

The brand new Preferential Procurement Regulations 2017, have been finalized and gazetted on 20 January 2017. There are some interesting changes and challenges that we will discuss during the coming months. We start off with the official media release from National Treasury:

The regulations were initially promulgated in 2001 and revised in 2011 thus making this the second revision since the initial promulgation.

General Procurement Guidelines

Government issued the General Procurement Guidelines not only as a prescription of standards of behaviour, ethics and accountability which it requires of its public service, but also as a statement of Government's commitment to a procurement system which enables the emergence of sustainable small, medium and micro businesses which will add to the common wealth of South Africa and the achievement of enhanced economic and social well-being of all South Africans.

Tenders in South Africa are measured on three principles, namely Functionality, Price and Broad-Based Black Economic Empowerment (B-BBEE). An Enterprise's ability to execute a contract is measured through the Functionality Principal in the Tender Environment. If an Enterprise's tender response does not pass the Functionality test it can't be measured on Price and B-BBEE. Enterprises that respond to tenders must ensure that they will pass the Functionality test in order to advance.

Functionality in Tenders Part 1

Functionality in Tenders (1)

The Preferential Procurement Policy Framework Act 2017, establish the rules according to how Government Entities must evaluate tenders. The Preferential Procurement Regulations of 2017 takes it a step further and gives guidance on how to specifically award points according to certain criteria such as B-BBEE and Price. 

There appears to be a serious lack of knowledge regarding South African tender procedures. Here, the tender processes are ruled by various Acts, Regulation and Guidelines which are specifically designed to ensure that the tender processes are in line with the Constitution of South Africa - which dictates that the tender process should be fair, equitable, transparent, competitive and cost-effective.

It is important to know that when you respond to a tender there are certain guidelines that Government Officials need to follow in order to evaluate your tender. According to the Implementation Guide - Preferential Procurement Regulations, 2017, pertaining to the Preferential Procurement Policy Framework Act, Accounting Officers and Accounting Authorities of all public entities listed in Schedules 2, 3A, 3B, 3C and 3D to the PFMA and municipal entities must comply with the rules and guidelines stipulated below.

If one looks at the General Procurement Guidelines that National Treasury issued to Government Departments, it is clear that Government wants the tender process to be fair, equitable, transparent, competitive and cost-effective exactly as Section 217 of the Constitution of South Africa requires.

Pages

Title Closing Date Tender No.
Invitation to Service Providers to Submit Proposals for the Procurement of a Quantum Scalar 16000 Generation 2 Robotics Tape Library Including Standard OEM Support and Maintanance 2018-11-20 11:00 CIPC BID NUMBER: 14/ 2018/ 2019
Invitation to Service Providers to Supply Laptops and Desktops to Cipc on a “as and when” basis under a warranty and Support Contract for three years (36 months) 2018-11-21 11:00 CIPC BID NUMBER: 15/ 2018/ 2019
Invitation to Service Providers to Submit Proposal to Supply Mpls Connectivity Between the Commission’s Main Data Center Located at the DTI Campus, 77 Meintjies Street, Sunnyside, Pretoria and the Remote Sites” 2018-11-19 11:00 CIPC BID NUMBER: 16/ 2018/2019
Supply and Delivery of one Piece Coverall to the South African Police Service for a period of two (02) years 2018-11-16 11:00 19/ 1/ 9/ 1/ 63TT(18)
Identification of Premises for Office Space (Provincial & District)for the NDA to be occuoied over a period of five years. 2018-11-12 14:00 NDA32/ FIN20/ 18
Appointment of a Service Provider for the Provision of Employment Wellness Services to All NDA Employees Over a period of three (3 years) 2018-11-12 14:00 NDA31/ CS15/ 18
Removal of Safes 2018-10-26 11:00 RFQ/ 2018/ 87
Invitation to an open tender for the Design, Supply, Installation And Certification Of Fire Sprinkler System at Building A8 Within Automotive Supplier Park Situated At Rosslyn (North Of Pretoria) 2018-11-14 11:00 AIDC T09/ 2018
Appointment of a Service Provider to Upgrade and Render Support Services for a Performance and Management System for a period of three years 2018-11-12 11:00 DST02/ 2018- 19
Mossel Bay : New offices of 173.86m2 and 5 undercover secured parking bays for the Department of Agriculture Forestry & Fishaeries for a 5 year lease : BBBEE Level - 4 Category A, B, C, & D 2018-11-09 11:00 CPTL30 / 18
Paarl : SASSA : New office accommodation : District Office : 453.82m2 & 10 parking bays : Category A, B, C, & D : BBBEE Level - 4 2018-11-09 11:00 CPTL38 / 18
Paarl: SASSA: New office accommodation: Local Office: 868.75m2 & 8 Lockup garages, 2 open parking bays and 5 visitors parking bays: Category A, B, C, & D: BBBEE Level - 4 2018-11-09 11:00 CPTL39 / 18
Supply, install and service wall mounted automatic Air Fresheners x 100 units to be installed in Eastboom CHC and 12 Clinics - public and staff toilets (12 months contract) 2018-10-26 11:00 ZNQ 263/ 18
Supply, install and service Sanitary Towel Bins x 64 units to be installed in Eastboom CHC and 12 Clinics - public and staff toilets (12 months contract) 2018-10-26 11:00 ZNQ 230/ 18
Industrial Tilting Pan 2018-10-30 11:00 PSH 926/ 1819
Measuring Cylinders -Stainless Steel 1,2,5 And 10 Litre 2018-10-30 11:00 PSH 864/ 1819
Betterment and Regravelling on District Road D761 between Chainage 0.00km to 4.00km in the KwaDukuza Local Municipality for Grade 3CE Vukuzakhe Contractors 2018-11-20 11:00 ZNT373T/ 3/ C2930/ 019/ S/ 1/ 2018- 2019
Betterment and Regravelling on District Road D1575 between Chainage 0.00km to 1.50km in the Ndwedwe Local Municipality for Grade 3CE Vukuzakhe Contractors 2018-11-20 11:00 ZNT373T/ 3/ C2930/ 017/ S/ 1/ 2018- 2019
Firearm safe - wall mounted 2018-10-30 11:00 PSH 783/ 1819
The Drain Clearing and Verge Maintenance On P2-3 From Km 7.567 To Km 38.056 in the Mandeni Local Municipality (Kz291) For Grade 3CE/SH Vukuzakhe Contractors 2018-11-22 11:00 ZNT 373T/ 3/ C2910/ 049/ S/ 1/ 2018- 2019

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Advantages and disadvantages of Consortiums

Consortiums are often considered as entities to use when responding to tenders in South Africa. The question that arises is whether to use a Consortium or a Joint Venture when responding to a tender. To help you with this we have compiled a list of advantages and disadvantages for both Consortiums as well as Joint Ventures. In this article we list the advantages and disadvantages of Consortiums. Look out for the same article on Joint Ventures.

Consortiums Advantages:

  • Easy to establish as there are no formal procedures... Read More
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