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designated sectors, but such a specific condition will need to be
specified in the tender advertisement.

Organs of state will be required as of 1 April 2017 to apply subcontracting BEE
to all tenders above a contract value of R30 million, if feasible to do so.
A minimum of 30% of the contract value will have to be subcontracted
to one or more of the following designated groups:

• EME’s or QSE’s;
• EME’s or QSE’s that are at least 51% owned by black people
/ black woman / black youth / black people with disabilities
/ black people living in rural areas / black people who are
military veterans;
• Cooperatives which are at least 51% owned by black people.

The tenderer will furthermore have to select the sub-contractor from a
list of approved and registered suppliers, to provide the required goods
or services.

The new regulations specifically mention that sworn affidavits as
prescribed by the B-BBEE Codes of Good Practice are sufficient as proof
of the B-BBEE status level of a tenderer. EME’s and 51% black owned
QSE’s, automatically qualifying for certain B-BBEE levels by way of a sworn
affidavit, and whom have previously struggled with the acceptance of
their BEE affidavits will find this provision of benefit to them.
The changes contained in the new regulations make it clear that
the B-BBEE status level of a tenderer will play a very important role
in the tender process. Businesses reliant on government tenders
should carefully review the new procurement regulations to prepare
themselves for compliance as well as mentally prepare themselves for
a period of implementation issues as organs of state come to grips with
the practical aspect of these new regulations.

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