Issue Date: 
Tuesday, July 31, 2018

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

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 general 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 tender. Regulation 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 keep up to date with these changes we recommend attending one of our How-to-Tender workshops that are presented across South Africa. Tender Workshop dates are published on our website at www.how2tender.com or for more information on the How-to-Tender workshops please email us at werner@how2tender.com

This article was written by Werner van Rooyen, Director of HowToTender which specializes in tender consulting and tender training.

Title Closing Date Tender No.
Routine maintenance of the municipal ICT infrastructure & support provision as and when required for a period of 36 months (3 years). 2019-08-19 11:00 No reference number
Appointment of a panel of maximum 8 contractors for civil engineering works for a period of 36 months, on as and when required basis 2019-08-21 11:00 No reference number
Appointment of a panel of maximum 8 contractors for civil engineering works for a period of 36 months, on as and when required basis. 2019-08-22 11:00 No reference number
Consultancy Services On Integrated Monitoring And Evaluation Of Implementation Of Sharm El-Sheikh Commitments And Africa Water Vision 2025 Based On The Integrated Water Resources Management (IWRM) 2019-08-01 15:00 AUC/DREAC/066
Consultancy services for SAP bank communication management 2019-08-02 15:00 No reference number
Lease of The Hartenbos Sports Grounds 2019-07-19 12:00 117-18/19
Provision of Software Application for a Land Use Management System (Property Register, Valuations and Zoning Register) And Support Services 2019-07-26 12:00 114-18/19
Hire of Portable Chemical Flush Toilets 2019-08-02 12:00 121-18/19
Managing and Demolishing of informal Settlements within the Mossel Bay area 2019-08-02 12:00 123-18/19
Supply, delivery, fitment and balancing of tyres 2019-08-08 12:00 TDR-5/2019
Removal Of Sewer Sludge 2019-08-08 12:00 TDR-6/2019
Lease of Steel Containers For Beehive Purposes 2019-08-16 12:00 122-18/19
Sale, collect and remove of scrap metal at Wellington Waste Water Treatment. 2019-08-01 10:00 WEB 15: 2019/2020
Cleaning of Planning and Customer Services at Jan van Riebeeck Weg 15 (unit 6) for the period up to 31 December 2019. 2019-08-01 10:00 WEB 14: 2019/2020
Safe handling, collection, transportation and disposal of asbestos for the period up to 30 June 2020. 2019-08-01 10:00 WEB 13: 2019/2020
Pauper funerals in Drakenstein Area from August 2019 till 31 December 2019. 2019-08-01 10:00 WEB 3: 2019/2020 (Readvertise)
Appointment of a panel of a maximum 8 contractors for sanitation works for a period of 36 months, on as and when required basis 2019-08-22 11:00 No reference number
Supply & delivery of air conditioners in the Drakenstein Municipal Area for a period up to 30 June. 2019-08-01 10:00 WEB 12: 2019/2020
Supply & delivery of wooden bitumen poles for HT lines for a period up to 30 June 2020. 2019-08-01 10:00 WEB 11: 2019/2020
Tenders are invited for the Civil Designer Software Training as per Specifications available at SCM: Acquisitions, Harrower Road, Port Elizabeth, 2019-07-19 11:00 CSQ07191667

Pages

Extension of validity period

By Werner van Rooyen

www.howtotender.co.za

31 January 2019

Those of you who are familiar with responding to tenders will know that it is common practice for procuring entities to extend the bid price validity period. We received the undermentioned queries regarding the extension of the validity period of the bid price.

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