B-BBEE Commission notes ruling on PPPFA Regulations

© Sergii Gnatiuk – 123RF.com

The B-BBEE Act permits organs of state or public entities to set B-BBEE qualification criteria for procurement and other economic activities and to exceed the criteria set in the Codes of Good Practice through section 9 (6) of the B-BBEE Act.

The declaration of the PPPFA Regulations of 2017 as invalid is not a blow to the B-BBEE requirements for tenders as reported.

The invalidity of the PPPFA Regulations of 2017 does not invalidate the B-BBEE Act, and the PPPFA Regulations were not issued under the B-BBEE Act.

The framework for the B-BBEE Act and how it is applied is clear and thus not affected by the ruling of the Supreme Court of Appeal.

In terms of section 10 (1) of the B-BBEE Act, all organs of state and public entities must apply any relevant Codes of Good Practice issued by Trade, Industry and Competition Minister in terms of section 9 of the B-BBEE Act in:

• Determining qualification criteria for the issuing of licenses concessions or other authorisations in respect of economic activity in terms of any law;
  
• Developing and implementing a preferential procurement policy;
  
• Determining qualification criteria for the sale of state-owned enterprises;
  
• Developing criteria for entering into partnerships with the private sector; and
  
• Determining criteria for the awarding of incentives, grants and investment schemes in support of broad-based black economic empowerment.

Section 10 (1) of the B-BBEE Act is therefore mandatory, and not optional for organs of state and public entities.