ANNOUNCEMENT 07 Dec 2011

In December 2011, the government of South Africa announced a change in the price advantage granted to domestic producers in certain public tenders.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE



Government Gazette No. 34350, 8 June 2011: http://www.buffalocity.gov.za/municipality/tenders2011/procu_policy_frmworkact.pdf
WTO-UNCTAD-OECD Sixth Report on G20 Trade and Investment Measures, May to mid-October 2011: http://www.oecd.org/investment/investment-policy/48941943.pdf


Inception date: 07 Dec 2011 | Removal date: open ended
Still in force

Public procurement preference margin

On 8 June 2011, the National Treasury of South Africa gazetted new Preferential Procurement Regulations, which grants preference for local firms in line with the Broad-Based Black Economic Empowerment (B-BBEE) Act. The B-BBEE Act aims to eliminate any economic disadvantages that are remnants of the Apartheid regime by promoting corporate ownership, management positions, employment equity, enterprise development etc. among the black population.
In line with this policy, the Preferential Procurement Regulations provide for a preference point system whereby tenderers that have a higher B-BBEE status level (i.e. that score better in terms of black economic empowerment) enjoy progressive procurement preferences.
Moreover, in the case of designated sectors where local production and content is deemed 'of critical importance', the tendering procedure must be restricted to locally produced goods, services or works only (Art. 9(1)).
As of April 2014, these designated sectors are: 

  • Bus bodies
  • Textile, clothing, leather and footwear
  • Power pylons
  • Canned / processed vegetables
  • Railway rolling stock
  • Pharmaceutical products
  • Set-top boxes for TV digital migration
  • Furniture
  • Power and telecom cables
  • Solar Water Heaters

And the shipbuilding sector is about to be designated (see "Related measures").
 
The "Tariff lines affected", "Sectors affected", and "Affected trading partners" listed here are those with respect to the designated sectors. As the B-BBEE scheme covers all economic activities, though, the true numer of tariff lines, sectors and trading partners affected is likely to be higher.