Joint Ventures and B-BBEE
By Werner van Rooyen, Director of HowToTender (Pty) Ltd which specializes in tender consulting and tender training.
Government Entities must use the Preferential Procurement Point System to calculate which tender response will be awarded the tender and if you do not have a good B-BBEE Score and if it is a close race, you are going to lose out with a low B-BBEE Score.
On 1 May 2015, the Amended B-BBEE Codes of Good Practice came into effect. These Amended Codes place a lot of emphasis on Ownership and have a major impact on the B-BBEE Scores of all businesses that participate in B-BBEE in South Africa. If your company is not going to score any points on Ownership you are also going to struggle to achieve a good B-BBEE Level. This will negatively impact your tender response.
Joint Ventures can be a great tool to use to increase B-BBEE Scores by joining forces with Black Owned companies thus increasing your Ownership. If you have the correct Joint Venture partner, with a good B-BBEE score, the overall score that you will achieve in the Preferential Procurement Point System can be much higher than going into the tender alone.
When bidding through a Joint Venture, the Joint Ventures must submit a Consolidated B-BBEE certificate if it is not an incorporated entity when responding to tenders. This means that you will have to obtain a new B-BBEE certificate for the Joint Venture which consolidates each participant’s B-BBEE status level. You apply for a Consolidated B-BBEE certificate at your B-BBEE Verification Agency who will issue the Consolidated B-BBEE certificate after combining the Joint Venture partners’ B-BBEE Certificates – this should not be a tedious task and it should not take long at all.
The Consolidated B-BBEE certificate must be tender specific – in other words it must contain the name and number of the tender that you are responding to.
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.
