bbbee codes of good practice and procurement regulations 24 november 2011
TRANSCRIPT
BBBEE Codes of Good Practice and Procurement Regulations
24 November 2011
Contents
Background
Alignment of Preferential Procurement Policy Framework Act and BBBEE Codes of Good Practice
Frequently Asked Questions
Conclusions
Background
CONSTITUTION
“Equality includes the full and equal enjoyment of all rights and freedoms. To promote the achievement of equality, legislative and other measures designed to protect or
advance persons or categories of persons disadvantaged by unfair discrimination maybe taken”
Chapter 2 of the Bill of Rights, Section 9
Background
CONSTITUTION
Section 217 of Act 108 of 1996, as amended by subsection 3 of Act. 61 of 2001 provides that: -
1. When an organ of state in the national, provincial or local sphere of government, or any other institution identified in national legislation, contracts for goods or services, it must do so in accordance with a system which is fair, equitable, transparent, competitive and cost-effective.
2. Subsection (1) does not prevent the organs of state or institutions referred to in that subsection from implementing a procurement policy providing for:
Categories of preference in the allocation of contracts; and The protection or advancement of persons, or categories of persons, disadvantaged by
unfair discrimination.
3. National legislation must prescribe a framework within which the policy referred to in subsection (2) may be implemented.
Background
PPPFA
Preferential Procurement Policy Framework Act No 5. of 2000/2:
An Organ of State must determine its preferential procurement policy and implement it within the following framework:
80/20 and 90/10 preference point system must be followed, i.e.:-
10 and 20 points - HDI 90 and 80 points - lowest price.
Background
B-BBEE ACT
Section 10 of the B-BBEE Act:
Every Organ of State and Public Entity must take into account and, as far as is reasonably possible, apply any relevant code of good practice issued in terms of this Act in:-
Determining qualification criteria for the issuing of licenses, concessions or other authorisations in terms of any law;
Developing and implementing a preferential procurement policy;
Determining qualification criteria for the sale of state-owned enterprises; and
Developing criteria for entering into partnerships with the private sector.
ALIGNMENT
Cabinet approved the alignment of Preferential Procurement Regulations and the B-BBEE policy
The Preferential Procurement Regulations of 2011 will come into effect on 7 December 2011.
While the alignment of Preferential Procurement Regulations and the B-BBEE policy is a step in the right direction, the ultimate objective is the total overhaul PPPF Act No. 5 of 2000
Alignment of PPPFA Regulations and B-BBEE
Alignment of PPPFA Regulations and B-BBEE
B-BBEE PPPFA Regulations
Beneficiary Black people Black people
Measures BBBEE 7 elements BBBEE 7 elements
Automatic BEE Compliance (< 5 Million)
Exempted Micro Enterprises Exempted Micro Enterprises
New PPPFA regulations use the B-BBEE scorecard to determine preference points
ALIGNMENT
Alignment of PPPFA Regulations and B-BBEE
ALIGNMENT
The preferential Procurement Regulations are applicable to organs of state as contemplated in section 1(iii) of the PPPF Act and all public entities listed in Schedules 2,3A,3B, 3C and 3D of the PFMA and Municipal entities
The preferential Procurement Regulations will thus be extended to all organs of state for uniformity purposes.
The revised Regulations affirm the 80/20 preference point system for procurement of goods and service for a rand value of R1million and 90/10 preference point system above R1million
On 80/20 principle, 20 points scored by a bidder will be in respect of B-BBEE status level and 90/10 principle, 10 points will be in respect of B-BBEE status level.
B-BBEE Recognition Levels
RECOGNITIONSCORELEVELSYMBOL
< 30%
≤30% - 40%
≤40% - 45%
≤45% - 55%
≤55% - 65%
≤65% - 75%
≤75% - 85%
≤85% - 100%
>100%
Non-Compliant
Level 8
Level 7
Level 6
Level 5
Level 4
Level 3
Level 2
Level 1
0%D
10%C
50%B
60%BB
80%BBB
100%A
110%AA
125%AAA
135%AAA+
RECOGNITIONSCORELEVELSYMBOL
< 30%
≤30% - 40%
≤40% - 45%
≤45% - 55%
≤55% - 65%
≤65% - 75%
≤75% - 85%
≤85% - 100%
>100%
Non-Compliant
Level 8
Level 7
Level 6
Level 5
Level 4
Level 3
Level 2
Level 1
0%D
10%C
50%B
60%BB
80%BBB
100%A
110%AA
125%AAA
135%AAA+
Alignment of PPPFA Regulations and B-BBEE
CALCULATION OF POINTS FOR B-BBEE RATINGS
Alignment of PPPFA Regulations and B-BBEE
In addition, the revised Regulations address the objectives of Industrial Policy Action Plan, especially those aimed at promoting the procurement of domestically produced goods and services.
The Regulations empower the dti to designate specific industries of critical and/or strategic importance where such tenders should prescribe that only locally manufactured products will be considered or that only locally manufactured products with a prescribed minimum threshold for local content will be considered.
Frequently asked questions
HOW DO I DETERMINE THE VALIDITY OF A BEE RATING CERTIFICATE?
With effect from 1 October 2011, only B-BBEE status level certificates issued by the following are valid:
Verification Agencies accredited by the South African National Accreditation System (SANAS) (see Statement 005)
Registered Auditors approved by the Independent Regulatory Board of Auditors
(IRBA) in accordance with the approval granted by the Department of Trade and Industry (see Statement 005)
Exempted Micro Enterprises- Statement 000, Section 4 of the B-BBEE Codes of Good Practice still applies for determining eligibility of a Exempted Micro Enterprise.
Frequently asked questions
HOW DO I DETERMINE THE VALIDITY OF A BEE RATING CERTIFICATE?
As at the end of September 2011 there are 78 SANAS Accredited Verification Agencies
Click on link for a list of all SANAS Accredited Verification Agencies
http://www.sanas.co.za/directory/bbee_default.php
Click on link of BEE verification agencies that are in possession of valid pre-assessment letter
http://www.thedti.gov.za/economic_empowerment/docs/verification/LOA_Preassessments.pdf
There are No IRBA approved registered auditors yet!
Frequently asked questions
HOW DO I DETERMINE THE VALIDITY OF A BEE RATING CERTIFICATE?
Frequently asked questions
B-BBEE VERIFIED ENTITIES
Click on link for example BEE Certificate_l.pdf
Frequently asked questions
HOW DO I DETERMINE ELIGIBILITY OF AN EXEMPTED MICRO ENTERPRISES (EMES)?
Any enterprise with an annual Total Revenue of R 5million or less qualifies as an Exempted Micro-Enterprise.
Exempted Micro-Enterprises are deemed to have B-BBEE Status of "Level Four Contributor" having a B-BBEE procurement recognition of 100%.
In an instance were the Exempted Micro Enterprise is more than 50% owned by black people, the enterprise qualifies for a promotion to a B-BBEE Status of "Level Three Contributor" having a B-BBEE procurement recognition of 110%
Frequently asked questions
HOW DO I DETERMINE ELIGIBILITY OF AN EXEMPTED MICRO ENTERPRISES (EMES)?
Sufficient evidence of qualification as an EME is o an auditor’s certificate (2011 EME Letter) oro certificate issued by an accounting officer, oro verification agency
Cost reduction and stifling growth at EME level
Biggest beneficiaries of B-BBEE through Enterprise Development and Preferential Procurement
Frequently asked questions
JOINT VENTURE B-BBEE STATUS
A trust, consortium or joint venture must submit a B-BBEE status level certificate in order to qualify for points
A trust, consortium or joint venture will qualify for points as an unincorporated entity provided they submit their consolidated scorecard as prepared for each separate tender
Frequently asked questions
HOW TO DETERMINE THE B-BBEE STATUS OF TERTIARY INSTITUTIONS
If a service is provided by only a tertiary institutions, such services must be procured from the tertiary institutions identified by means of bidding process. Tertiary institutions must submit their B-BBEE status in terms of the B-BBEE Codes of Good Practice’ Specialized Scorecard.
Frequently asked questions
LOCAL CONTENT
Paragraph 9(1) of the draft Regulations empowers the dti to designate specific industries where tenders should prescribe that only locally manufactured products with a prescribe minimum threshold for local production and content will be considered. This will come into effect after the dti has designated in line with national development and industrial policies. National Treasury will issue relevant instructions and guide
Where there is no designated sector, a specific tendering condition may be prescribed minimum threshold for local content will be considered in accordance with directives issued by the National Treasury in consultation with the dti.
Conclusion
The broader economic developmental agenda must address inter alia:
Ensuring that BBBEE contributes to the broader developmental objectives of government.
Create a conducive environment for access to economic opportunities
Promotion of entrepreneurial initiatives among the majority of South Africans
Alignment and consistency in policies, legislation and programmes of Government
List of Western Cape verification agencies and the sectors they are accredited to verify
BBBEE VERIFICATION AGENCY DETAIL RECORD SECTORS ACCREDITED
NAMEBODY NUMBER PHYSICAL ADDRESS TEL NO. CONTACT PERSON E-MAIL
AQRATE (PTY) LTD BVA 021 2ND FLOOR, WJ LOUW BLDG 021 949 4612 CHRIS VAN WYK [email protected] BBBEE Codes of Good Practice
7 OLD PAARL RD, BELLVILLE
BBBEE RATING AGENCY BVA 074 18A GANTS PLAZA 083 700 0049 MS M COETZEE [email protected] BBBEE Codes of Good Practice
LANGENEGGER STR, STRANDBEE EMPOWERED & LABOUR BVA 057 A 21, BLOCK 1 NORTHGATE ISLAND 021 511 0802 MS L FRANK [email protected] BBBEE Codes of Good PracticeCONSULTANCY SECTION ROAD PAARDEN EILAND
BEE ONLINE (PTY) LTD BVA 038 7 DIRK SMIT CRES 087 750 6505 GAVIN FLETCHER [email protected] BBBEE Codes of Good PracticeMEYERSDAL
BEE VERIFICATION AGENCY BVA 014 8 PARK STR 086 072 2222 WILLEM MOSTERT [email protected] BBBEE Codes of Good PracticeDURBANVILLE 021 975 3689
CODEX RATINGS (PTY) LTD BVA 065 C 3A WESTLAKE SQ 021 701 0470 JL POTGIETER [email protected] BBBEE Codes of Good Practice
1 WESTLAKE DRIVE, TOKAI
EMPOWERDEX CTN (PTY) LTD BVA 141 14TH FLOOR METROPOLITAN LIFE CENTRE 021 419 5130 DUNCAN DE GROOT [email protected] BBBEE Codes of Good Practice
7 COEN STEYTLER AVE, FORESHORE, CT
MINDWALK CONSULTING (PTY) LTD BVA 090 UNIT 5, ROTHERFIELD RD 021 797 2444 NP HARTMAN [email protected] BBBEE Codes of Good PracticePLUMSTEAD
SERA WC (PTY) LTD BVA 121 UNIT 101 A, EDWARD STR 021 910 1110 MS SJ NEETHLING [email protected] BBBEE Codes of Good PracticeTYGER VALLEY
UKUTHENGA VERIFICATION SOLUTIONS BVA 116 44 HOPKINS STR 021 911 2906 JODY JANSEN [email protected] BBBEE Codes of Good PracticePAROW
IQUAD VERIFICATION SERVICES (PTY)LTD BVA 131 BELLVILLE 021 300 0013 ext 2 SAM ADAMS [email protected] BBBEE Codes of Good Practice
MOSELA RATING AGENCY BVA 080 20 WATERKANT STREET 021 418 4807 DANIELLE MINTOOR [email protected] BBBEE Codes of Good PracticeCAPE TOWN
KBONGA BEE VERIFICATION BVA 022 7 Coen Steytler Ave 021 421 4940 Ms AN SIBISI [email protected] BBBEE Codes of Good Practice
AGENCY CAPE TOWN
