Issue Date: 
Tuesday, November 1, 2016

When to sub-contract?

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 which came into effect on 1 April 2017. Many entrepreneurs ask us whether they should sub-contract or not, when responding to a tender.

Regulation 9 of The Preferential Procurement Regulations 2017, stipulates the following:

1: 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.

2: The Organ of State must advertise this specific tender condition that the successful bidder must sub-contract at a minimum of 30% (of the value of the contract) to (one or more) to an EME or QSE which is at least 51% owned by:

a.    black people;

b.    black people who are youth;

c.    black people who are women;

d.    black people with disabilities;

e.    black people living in rural or under develop areas or townships;

f.    black people who are military veterans;

g.    A cooperative which is at least 51% owned by black people;

3: In paragraph 3 of Regulation 9 it also states that the Organ of State must make available the list of all suppliers registered on a database approved by the National Treasury to provide the required goods or services in respect of the applicable designated groups mentioned above from which the bidder must select a supplier.

Regulation 9 is very clear because its states "the tenderer MUST sub-contract…..". Thus, according to the Regulations all contracts with a value of R30 million and above will have to comply with this Regulation. Read the tender document carefully because somewhere in the tender document it will stipulate whether or not the bidder will have to sub-contract. Follow those rules. If the tender document doesn't contain any sub-contracting instructions then it is not necessary to sub-contract.

The fact is that the tender document will dictate what you should or should not do. Read the tender document carefully, follow the instructions precisely and to the point.

To learn more about this and all the other new developments regarding tenders, please attend one of our How-to-Tender workshops. Tender Workshop dates are published on our website at www.how2tender.com. For more information on the tender courses please email Werner at werner@how2tender.com.
 
This article was written by Werner van Rooyen, Director of HowToTender (Pty) Ltd. which specializes in tender consulting and tender training.

Title Closing Date Tender No.
Supply and delivery of agriculture inputs (white maize & dry bean seeds) for the Umzinyathi District Municipality 2019-09-04 12:00 T 2020-15
Supply and fitment of two hydraulic low-level bin lifters 2019-09-02 12:00 RE-ADVERTISMENT: 114/2019
Supply and delivery of agriculture inputs (chemicals & fertilizers) for the Umzinyathi District Municipality 2019-09-04 12:00 T 2020-16
Formal Tender: TD-03/08/19: Oudtshoorn Municipality: New Library: Rose Valley - Oudtshoorn, 2019-09-25 12:00 FORMAL TENDER: TD-03/08/19
Provision of Security Services for a period of 60 Days To BCMM, Chiselhurst, East London 2019-08-23 12:00 RFQ/SCM/2019-20/53
Supply and Delivery of Black Refuse Bags to BCMM Chiselhurst, East London (Inland Region) 2019-08-23 12:00 RFQ/SCM/2019-20/52
Supply and Delivery of Black Refuse Bags to BCMM Chiselhurst, East London (Coastal Region) 2019-08-23 12:00 RFQ/SCM//2019-20/51
Appointment of a Service Provider to Supply and Deliver Television Sets for Kiwane Resort 2019-08-23 12:00 RFQ/LED/2019-20/50
Supply and Delivery of Reinforced Panel Fencing – Bunkerhill Field A 2019-08-23 12:00 RFQ/DCOM/2019-20/48
Horticulture Training Programme NQF Level 2 2019-08-23 12:00 RFQ/DHR/2019-20/47
Data Verification of Educational Qualifications, Registration With Professional Institutions, Credit & Criminal Checks for Prospect Candidates For Buffalo City Metropolitan Municipality 2019-08-23 12:00 RFQ/DHR/2019-20/46
Supply and Delivery Furniture for New Office Hod 2019-08-23 12:00 RFQ/DCS/2019-20/45
The Supply and Delivery of Office Furniture for Disaster Management 2019-08-27 12:00 RFQ/HPSES/2019-20/62
Supply and Delivery Of HTH Chlorine To BCMM Stores, Chiselhurst, East London 2019-08-27 12:00 RFQ/SCM/2019-20/61
Preventative Maintenance On Hydraulics Systems For Solid Waste Compactors For Fleet No. 293, Mitsubishi Fuso Fv26-340 Model 2007 2019-08-27 12:00 RFQ/MW/2019-20/60
Preventative Maintenance on Hydraulics Systems for Solid Waste Compactors For Fleet No. 257, Mitsubishi Fuso Fv26-340 Model 2007 2019-08-27 12:00 RFQ/MW/2019-20/59
Preventative Maintenance On Hydraulics Systems for Solid Waste Compactors For Fleet No. 244, Mitsubishi Fuso Fv26-340 Model 2007 2019-08-27 12:00 RFQ/MW/2019-20/58
Supply and Delivery of Sports Kits and Equipment for Youth in Sports Development For Ward 22 2019-08-27 12:00 RFQ/IDP/2019-20/57
Supply and Delivery of Reinforced Panel Fencing – Bunkerhill Field B 2019-08-27 12:00 RFQ/DCOMS/2019-20/56
Low/Medium Voltage Line Training Programme 2019-08-27 12:00 RFQ/DHR/2019-20/55

Pages

8 things you must know about Joint Ventures

By Werner van Rooyen

31 January 2019

One of the most popular types of business arrangements that are being used by South Africans, in the Tender environment, is Joint Ventures.

There are eight things that you must know about Joint Ventures:

  1. Definition

A Joint Venture is a strategic cooperation where two or... Read More

Free Keyword search

Search all tender notices for FREE!

No subscription or registration required!

You can also search by the reference of the the tender.

Advanced search

Search by Issuer, Region or Sector, individually, or using any combination of the three.