The National Treasury will this week publish new draft regulations for comment with regards to the Preferential Procurement Policy Framework, which ran into legal problems last month.
The Constitutional Court last month dismissed an appeal from the minister of finance seeking relief from a case Afribusiness initiated to have the minister found to have acted beyond their scope of powers when the office promulgated the Act in 2017.
The Procurement Regulations, among other things, introduced pre-qualification criteria to be eligible to tender.
Under the regulations, if an organ of state elects to apply the pre-qualification criteria, any tender that does not meet the criteria is an “unacceptable tender”.
These qualifying criteria |advance certain designated groups and provide that only certain tenderers may respond, including:
- Tenderers having a stipulated minimum Broad-Based Black Economic Empowerment (B-BBEE) status level.
- Exempted micro enterprises (EMEs) or qualifying small enterprises (QSEs).
- Tenderers subcontracting a minimum of 30% to EMEs and QSEs, which are at least 51% black owned.
The judgment saw the National Treasury director-general Dondo Mogajane tell the state organs in a letter dated February 25 that the minister will on “an urgent basis, be seeking confirmation from the Constitutional Court that the invalidity of the procurement regulations has been and continues to be suspended”.
He then said that while the department is awaiting guidance from the apex court, government entities are advised that:
- tenders advertised before February 16 2022 be finalised in terms of the procurement regulations;
- tenders advertised on or after February 16 be held in abeyance; and
- no new tenders be advertised.
However, Mogajane, in a note dated March 3, backtracked from new the tenders being in abeyance.
He instead said state organs may request an exemption from the provisions of the Act for a specific procurement. Mogajane said the new draft regulations will be published for comment in the week of March 7.
Black Business Council CEO Kganki Matabane said the organisation would be meeting with the Treasury on Wednesday.
Piet le Roux, the CEO of Sakeliga, hailed the apex court’s decision as having dealt a fatal blow to BEE.
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