Issue Date: 
Thursday, October 31, 2019

Sub-contracting rules to be aware of when responding to tenders

By Werner van Rooyen, Director of HowToTender (Pty) Ltd which specializes in tender consulting and tender training.

There seems to be a lot of confusion amongst entrepreneurs when it comes to tenders and sub-contracting, due in large part to The Preferential Procurement Regulations, 2017 that has been implemented on the 1st of April 2017.  Many entrepreneurs ask us whether they should sub-contract or not, in responding to a tender and how and where do they get onto the sub-contracting lists.

There are 3 sub-contracting rules in the Preferential Procurement Regulations 2017 that Organs of State can/must apply when issuing tenders to the public.

The first Regulation is Regulation 4 which state inter alia: if an Organ of State decides to apply pre-qualification criteria to advance certain designated groups that Organ of State must ADVERTISE the tender with a specific tendering condition that certain bidders can or may respond.

The second Regulation is Regulation 9 which state inter alia: if it is feasible to sub-contract for a contract above R30 million, an Organ of State must apply sub-contracting to advance designated groups.

The designate groups mentioned in both Regulation 4 and 9 are Black Owned Enterprises with 51% or more black ownership and any of female Black owned, youth black owned, black people with disabilities owned or black military veterans owned enterprises.

The third sub-contracting rule has to do with sub-contracting after the award of the tenderRegulation 12 states inter alia: (3) a person awarded a contract may not subcontract more than 25% of the value of the contract to any other enterprise that does not have an equal or higher B-BBEE status level of contributor than the person concerned, unless the contract is subcontracted to an EME that has the capability and ability to execute the subcontract.

The tender document will dictate how you should or should not sub-contract.  Read the tender document carefully; follow the instructions precisely and to the point.  Organs of State are applying these Regulations rigorously and failing to comply will lead to your tender response being disqualified.

Tender trends and Regulations are changing frequently.

To learn more about this and many other tender conditions attend our “Become a Tender Expert” 2-Day workshops presented in Johannesburg, Pretoria, Durban, Port Elizabeth, and Cape Town.  Book and pay online at https://howtotender.co.za/tender-expert-form/

Contact us at wernervr@howtotender.co.za should you require more information.

You can also purchase a Tender Manual (Handbook) on our website https://howtotender.co.za/ which is a step by step guide how to respond to a South African Tender.  It includes examples of completed SBD forms.

Title Closing Date Tender No.
Provision of Open Source Learner Management Service for a period of 36 Months 2020-03-06 11:00 NEMISA/ 2019/ LMSRFB010
The Appointment of a service provider to conduct a feasibility study towards the development of a monumental flag and flag pole. 2020-03-13 11:00 DAC 14/ 19- 20
Appointment of service provider to supply and deliver 5 ton truck for Clanso Farmer Production Support Unit (FPSU) located in ward 18,24,27, and 28 in the Umhlathuze Local Municipality within King Cetshwayo District Municipality in the province of Kwazulu-Natal 2020-03-12 11:00 SS- KZN 7/ 1/ 6/ 3 (753) 3T
Appointment of an HR consultancy firm to provide support to the CETA Administrator 2020-03-06 11:00 016- 2019/ 2020
Procurement of alternative accommodation for the Department of Public Enterprises (lettable office space of 12 144.34sqm and 228 parking bays for a period of 5 years) in Pretoria CBD, Arcadia, Hatfield 2020-03-13 11:00 H19/ 015PF
Procurement of alternative accommodation for the Department of Correctional Services - JICS (lettable office space of 497.73sqm and 12 parking bays for a period of 3 years 2020-03-13 11:00 H19/ 016PF
Appointment of a service provider to render technical security maintenance of KZN Legislature’s security systems infrastructure for a period of 36 months 2020-03-16 11:00 KZNL 01/ 2020
ZNT 02975W: KZN: Department of Community Safety and Liaison : Durban West Office: Pinetown: Proposed hire of office accommodation in extent of 242m2 four (04) lock up three (03) under cover and one (01) parking bay for disabled person. 2020-03-20 11:00 ZNT 02975W
Appointment of a Service Provider to Render Cleaning Services for the Housing Development Agency Head Office, 6 – 10 Riveria Office Park, Riviera Road, Killarney 2020-03-13 11:00 HDA/ JHB/ 2019/ 022
ZNT 02976W KZN: Department of Community Safety and Liaison: ILembe District Office: Kwa Dukuza: Proposed hire of office accommodation in extent of 242m2 four (04) lock up three (03) under cover and one (01) parking bay for disabled person. 2020-03-20 11:00 ZNT 02976W
Rendering of Security Services at the Department of Labour, Mt Ayliff Labour Centre for a period of 36 months (3 years). 2020-03-27 11:00 LECS 16/ 2019
Rendering of Security Services at the Department of Labour, Maclear Labour Centre for a period of 36 months (3 years) 2020-03-27 11:00 LECS 10/ 2019
Appointment of a service provider to provide office space on a lease agreement for CCMA Ekurhuleni office within the Benoni and/ Germiston CBD area for a period of five (5) years. 2020-03-13 11:00 CCMA/ 2018/ 38(A)- EKU
Rendering of Security Services at the Department of Labour,Butterworth Labour Centre for a period of 36 months (3 years). 2020-03-27 11:00 LECS 11/ 2019
Rendering of Security Services at the Department of Labour, Lusikisiki Labour Centre, Flagstaff and Bizana Visiting Points for a period of 36 months (3 years). 2020-03-27 11:00 LECS 09/ 2019
Rendering of Security Services at the Department of Labour, Mthatha Labour Centre for a period of 36 months (3 years). 2020-03-27 11:00 LECS 08/ 2019
Limpopo Central Hospital - Supply Of Bulk Services to Site 2020-03-13 11:00 NDOHF 11/ 2019- 2020
Request For suitable office space for SITA Limpopo, Polokwane Office through an operating lease for a period of 5 years 2020-03-13 11:00 RFB 2078- 2019
Appointment of a service provider for the re-arrangement of the office layout at the Cecilia Makiwane building. 2020-03-23 11:30 SCM 05/2020/SANC
Appointment of a Service Provider to Provide Office Space for the HWSETA Cape Town Provincial Office for a period of five (5) years 2020-03-23 11:00 HWSETA0011/ 2020

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