Public Procurement Act Signed into Law: The Continued Relevance of BEE

On 23 July 2024, the President signed the Public Procurement Act into law, marking a significant step towards creating a single framework for public procurement.

This Act follows the revision of the Preferential Procurement Regulations in November 2022, and brings into effect the Public Procurement Bill that was released for public comment earlier in the year. We previously released an update on this in April 2024.

Key aspects are as follows:

1. No Commencement Date: Although the Act is now law, there is no set commencement date for its implementation, and its provisions are not yet in effect.
2. Transitional Arrangements: The 2022 Regulations were merely a placeholder while this Act was being finalized. The Act provides that a bid awarded or advertised before the commencement of the Act must be dealt with in terms of the law applicable at the time of the award or advertisement. This implies that the 2022 Regulations will remain applicable until the commencement date of the Act and its regulations.
3. Pending Regulations: New regulations that will outline practical details, such as the balance between price and BEE status, are still pending. These are expected to be issued by the Minister of Finance soon.
4. BEE Relevance: The Act requires the Minister to consider applicable BEE Codes when setting targets. Public institutions must also apply pre-qualifying criteria that consider bidders with BEE statuses, ensuring that BEE remains a key consideration in public procurement processes.

Next steps for you:

1. Stay Informed: Keep an eye out for the release of the new regulations, which will offer detailed guidance on implementing the Act and its impact on BEE.
2. Review and Adapt: Evaluate your current BEE strategy to align with the new Act and maintain competitiveness.
3. Engage with Experts: Seek advice from professionals. For guidance or assistance in navigating the new legislation or refining your BEE strategy, contact Transcend.

Should you need guidance or assistance in navigating the legislation or your BEE strategy, contact Transcend