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.
Silver electric surgical oscillating orthopaedic medical bone saw (maxi drive) with accessories 2018-08-01 11:00 ZNQ 144 / 2018 / 19
Service provider to service fire extinguishers and hose reels, the company must be CIDB 1ME grade or above. The kilometers from St. Apollinaris Hospital to the clinics (single trip to) is: Sokhela Clinic x 07 (+/- 45.5km); Malenge clinic x 07 (+/-27km); Sphamandla clinic x 07 (+/- 18km); Riverside clinic x 07 (+/- 18km); Kilmun clinic x 07 (+/- 27km); Qulashe clinic x 07 (+/- 52km). 2018-08-02 11:00 84/ 2018/ 2019NSI
Supply Kiwi complete vacuum delivery system with palm pump (50 set) 2018-07-30 11:00 433/ 17- 18
Supply 8 bay mobile filer (04 units) 2018-07-30 11:00 111/ 18- 19
Service provider to service floor cleaning machine and replace the switch, the kilometers from St. Apollinaris Hospital to the clinics (single trip to) is: Riverside clinic x 02 (+/- 18km); Sokhela clinic x 01 (+/- 45.5km); Sphamandla clinic x 01 (+/- 18km); Kilmun clinic x 02 x (+/- 27km); Qulashe clinic x 01 x (+/- 52km); Malenge clinic x 02 x (+/- 27km). 2018-08-02 11:00 86/ 2018/ 2019NSI
6 Units x Portable Vascular Access - Illumination System 2018-07-27 11:00 ZNQ 23- 2018/ 19
Desludging of septic tank, the kilometers from St. Apollinaris Hospital to the clinics (single trip to ) is: Malenge Clinic x 02 (+/- 27km); Riverside clinic x 01 (+/- 18km); Qulashe clinic x 01 (+/- 52km); Sphamandla clinic x 02 (+/- 18km); Sokhela clinic x 02 (+/- 45,5km); Kilmun clinic x 02 (+/- 27km) 2018-08-02 11:00 82/ 2018/ 2019NSI
Supply pop walking heels - large (10 000 units) 2018-07-30 11:00 427/ 17- 18
Appointment of a service provider to supply, install and migrate the existing server infrastructure to a virtual environment. 2018-08-10 11:00 SHRA/ RFB/ ADMIN/ 05/ 201819
Supply lockable stationery cupboard 6ft (24 units). 2018-07-30 11:00 136/ 17- 18
Service provider to clean Jojo tanks,the company must be CIDB grade 1ME or above,the kilometers from St. Apollinaris Hospital to the clinics (single trip to) is: Riverside clinic x 01 x 7500L (+/- 18km) Sokhela clinic x 04 x 5000L (+/- 45.5km) Sphamandla clinic x 08 x 5000L (+/- 18km) 2018-08-02 11:00 109/ 2018/ 2019NSI
Supply floor polisher machine R46 (16 units). 2018-07-30 11:00 136/ 17- 18
Service provider to service airconditioner at Kilmun clinic, the company must be CIDB 1ME or above x 06 unit 2018-08-02 11:00 111/ 2018/ 2019NSI
Supply combi steamer (01 unit) 2018-07-30 11:00 79/ 18- 19
Request for information: A Nursing College Administration System (NCAS) for the South African Military Health Service (SAMHS) nursing college 2018-08-10 11:00 RFI 1772/ 2018
Service provider to service airconditioners at St. Apollinaris Hospital, the company must be CIDB 1ME or above x 87 unit 2018-08-02 11:00 113/ 2018/ 2019NSI
Supply pasteo chairs maroon in colour (130 units) 2018-07-30 11:00 68/ 18- 19
Service to Threatre Aircondtioning And Plantrooms 2018-07-27 11:00 ZNQ 41- 2018/ 19
Provisioning, deployment and training of the Check Point firewall solution for the South African Police Service including support and maintenance for a period of 12 (twelve) months. 2018-08-10 11:00 RFB 1763/ 2018
Servicing of Genset -{720&960- Hour Service and Annual Electrical Service} at New Workshop and Kitchen Genset Plant as per Specification 2018-08-06 11:00 ZNQ 404/ 18- 19

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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