ARTICLE · 07 DECEMBER 2020

Court Overturns BBBEE Pre-Qualification

SchoemanLaw Inc.

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It has become a usual requirement for tenders to have pre-qualification criteria, especially including its BBBEE compliance level.

South AfricaGovernment, Public Sector

Nicolene Schoeman-Louw

It has become a usual requirement for tenders to have pre-qualification criteria, especially including its BBBEE compliance level.

The recent supreme court of appeal case, Afribusiness NPC v The Minister of Finance (Case no 1050/2019) [2020] ZASCA 140 (2 November 2020) has invalidated this practice with far-reaching implications, especially for advertised but unawarded tenders.

Facts

The matter concerns the validity of the Preferential Procurement Regulations, 2017 (the "2017 Regulations") promulgated by the Minister of Finance (the "Minister") on 20 January 2017 under section 5 of the Preferential Procurement Policy Framework Act 5 of 2000 (the "Framework Act" or "PPPFA").

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