Government property tenders to exclude certain practitioners

President Cyril Ramaphosa recently signed the Property Practitioners Act 22 of 2019 (Act) into law and it’s applicable primarily to persons or commercial entities involved in the activities of selling, letting, collections, raising finance or rendering services as an intermediary through selling or letting of property.

Further, the Act prescribes that when an organ of state procures property-related goods and services, it may only make use of those property practitioners, “Who comply with broad-based black economic empowerment and employment equity legislation and policies”, respectively.

The overall aim of the Act is to expedite the pace of transformation within the property sector and the state deemed it necessary to incentivise practitioners to sustain their own compliance to the demands of B-BBEE and the targets for employment equity, per se, before being considered for government contracts.

In August 2021, National Treasury revised the application of the Preferential Procurement Policy Framework Act, (PPPFA) 2017 Regulations and introduced a new formula, to calculate the points for price in respect of a tender for the disposal or leasing of state assets.

The formula prescribes that the highest price offer for letting or selling government property will receive the most points with the balance of the points being scored for the practitioner’s B-BBEE status.

With the commencement of the Act on 1 February 2022, practitioners bidding for government property tenders will be evaluated through a process of pre-qualification, if they can prove their compliance to the B-BBEE and employment equity legislation as well as, for example, comply with any other transformation targets set by the Property Practitioners Regulatory Authority (PPRA).

Such a demand may include a requirement that practitioners implement incubation and capacity building programs to redress the imbalances of the past and to support the concept of sector transformation.

Organs of state are already allowed to include an “Objective Criteria” in tenders, which will support the promotion of initiatives to create an inclusive and integrated property sector. 

According to Gerrit Davids, Lead Advisor at TaranisCo Advisory, tendering agency, “All persons and commercial entities who acts as property practitioners, should familiarise themselves, not only with the processes required to comply with the rules of this legislation, in order to be allowed to act as property practitioners, but also to make an effort to understand the instructions pertaining to government property-tenders, which could exclude them, through some rigid pre-qualification criteria.”

For more details on this Act and its Regulations, visit our website: www.taranis.co.za or contact Gerrit Davids | Lead Advisor | TaranisCo Advisory CC  | Cell. 082 496 1657 E-mail:  This email address is being protected from spambots. You need JavaScript enabled to view it.