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.


Title Closing Date Tender No.
Appointment of Service Provider to Render Laundry Services for a period of Three (03) Years 2019-01-30 10:00 PM102/2018
Oudtshoorn Municipality: Refurbishment of booster pump stations AP1, AP6, AP7 and Vlakteplaas 2019-01-25 12:00 TD3/10/18
Oudtshoorn Municipality: Refurbishment of pressure control chambers and bulk water meters 2019-01-25 12:00 TD4/10/18
Provision of surgical consumables for forensic pathology services in the Mpumalanga Department of Health for a period of three years 2019-01-22 12:00 HEAL/181/18/MP
Supply and delivery of cleaning chemical for Mpumalanga Department of Health for a period of three years 2019-01-22 12:00 HEAL/182/18/MP
Supply and delivery of toilet paper to Mpumalanga Provincial Government Departments for a two (2) year period, as and when required 2019-01-31 12:00 MPPT005/17/01
The appointment of a service provider to assist with the service level agreement for maintenance and repairs on the installed access control and cctv systems for a period of 3 years 2019-01-21 11:00 RFP347/2018
Appointment of a service provider to undertake an independent investigation and provide recommendations on options for the appropriate institutionalisation 2019-01-21 11:00 RFP348/2018
Outright purchase of a Mercedes-Benz Vito 116CDI Tourer Select (2019) long wheel base (8 seater) with tow-bar 2019-01-24 11:00 06/2018/19
Supply, delivery, installation and rental of dosing equipment including the supply and delivery of calcium hypochlorite solution for ERWAT WWCW 2019-01-25 12:00 RE- ADVERT ERW201710/TNDR-008
The supply, delivery, installation and monitoring of a tracking system that will include hardware, software, labour, cellular airtime and maintenance on a thirty six (36) month rental basis services and to supply, commission and install an integrated and automated fuel and fleet management solution with associated on-site and managed information services for a period of thirty six (36) months 2019-01-25 12:00 ERW201804/TNDR-005
Request for proposals for appointment of a service provider to review and amendment of the City of Johannesburg, (COJ) informal trading policy for a period of six (6) months. 2019-01-31 10:30 A797
Appointment of service provider to provide plumbing services on all ERWAT sites 2019-02-01 12:00 ERW201806/TNDR-001
Request for proposals for City of Johannesburg panel for training interventions for the period of three years (3) 2019-02-15 10:00 A796
Supply & Delivery of Wireless Network Equipment 2019-01-18 12:00 SCM/2019/75/CORP
Supply, Delivery, Service & Maintenance of Firefighting Equipment 2019-01-18 12:00 SCM/2019/78/CORP
Provision of Air Conditioner Maintenance Services 2019-01-18 12:00 SCM/2019/80/CORP
Provision of Mimecast Services 2019-01-18 12:00 SCM/2019/85/CORP
Supply & Delivery of Electrical Inventory Items 2019-01-25 12:00 SCM/2019/94/ENG
Appointment of construction of a small administration block, 2 x grade R classrooms, guard house, erection of fence, completion of the multi- purpose classroom, nutrition centre, 2 x 3 classroom blocks, conversion of 1 x 3 classroom block into hall and external works at Leboeng Primary School located in Leboeng Village in Sekhukhune District, Limpopo Province grade 7 GB and Above 2019-01-30 12:00 EDDP 184/57B


10 Features of a good Joint Venture Agreement

By W van Rooyen


A Joint Ventures is a good business idea to compete for tenders if one does not have all the necessary expertise that are required from a specific tender. The thing to remember though is that you must have a solid Joint Venture Agreement in place for your Joint Venture. A good, rock solid Joint Venture Agreement will protect the participants to the Joint Venture.

 Here are 10 features that any good Joint Venture Agreement... Read More

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