Compliance management when the procurement law is struck

When a procurement law is struck down, the compliance management question for a supplier to the state is not what the court said. It is whether your file can show, for every open bid and every awarded contract, which rules it was evaluated under and on what date. If it cannot, the judgment is the smaller of your two problems, and no software fixes a file that was never written.

On 17 September BusinessTech reported that the Constitutional Court had declared the Public Procurement Act of 2024 unconstitutional and invalid. TimesLIVE and GroundUp carry the ground: a unanimous judgment by Acting Justice Gcinikaya Nuku found that Parliament failed its constitutional duty to facilitate reasonable public participation. A reworked Chapter Four had been put to the public with four hours to read it, and Treasury considered about 40 of 112 submissions. The applicants were the Western Cape Premier, the City of Cape Town, amaBhungane and Solidarity.

One fact in the reporting matters more than the ruling. The Act was assented to on 18 July 2024 but never brought into operation. Its commencement waited on a proclamation that was never issued, and the draft regulations that would have given it effect were only published on 16 April 2026, with comment closing on 15 July.

Every bid a South African business has submitted to the state in the last few years was scored under the Preferential Procurement Policy Framework Act of 2000. The Preferential Procurement Regulations, 2022, are made under it. That is still the regime on Friday. None of the reports read on the day says whether the order is suspended, and it does not need to be: nothing was running under the Act to stop.

This piece does not argue the judgment. It is about the file.

Why the file survives the judgment

A preferential procurement score is awarded under a set of rules, on a date, by an evaluator, against documents you submitted. The rules can be replaced. The score you were given, the rules it was given under and the date it was given do not change, and neither does your obligation to show them.

Consider a transformation manager whose company won a municipal contract in July. It was scored on price and on preference points, and the points came from a B-BBEE certificate and a set of declarations. The auditor who opens that contract in 2027 will ask which regime governed the evaluation. The answer is a matter of record, not of opinion, and the record has to be yours, because the municipality's file is not something you can rely on being complete.

The same applies in the other direction. A contract you lost in August, on points, was lost under the 2022 regulations, and the judgment says nothing about it. What the judgment does is put the next regime back to the drawing board, which means the rules named in bid documents may keep changing for some time. Whether you can act on any of that depends on whether you kept the evaluation letter, the scoring, and the date.

That is the trap in this week's headlines. A supplier who reads "struck down" and assumes the points on a live bid are in doubt is wrong. A supplier who assumes the file does not matter because nothing changed is also wrong. Procuring bodies had been preparing for the switch since April, and any bid document that names the Act as the coming regime is naming a law that will now never commence.

The five lines each bid needs

Every bid, open or closed, gets a block in the register with five lines:

• the bid or contract number
• the date the bid closed
• the rules named in the bid document as governing evaluation, copied from the document, not summarised
• the preference points claimed and the evidence submitted for each
• the evaluation outcome, with its date and the letter it came in

That is a compliance management record, and it does not need software to exist. A sheet with five columns and one row per bid does it. What it needs is a person who owns it and a rule that no bid is submitted until its row is written.

Two of those five lines are where businesses fall down. The rules named in the bid document are almost never copied, because everyone assumes they are the same as last time. And the evidence submitted for each point is scattered across the bid pack, the certificate folder and someone's email. When the regime changes, those are the two lines that get asked about.

What changes on Monday, whatever the court said

Three things, none of which depend on reading the judgment first.

Open bids: for every tender you have submitted and not yet heard on, write the five lines now, while the bid pack is still to hand. If the evaluation regime changes before award, you will be asked to confirm what you claimed under the old one.

Awarded contracts: for every live contract to a state body, find the award letter and record the date and the rules it references. The expected answer is the Preferential Procurement Policy Framework Act and the 2022 regulations. If a letter or bid document references the 2024 Act by name, that is a line in your file that will be discussed, because it names a law that was never in force. The file settles which one you are in.

Bids you are drafting: read the evaluation section of the bid document and write it into the row before you write the bid. If the document is silent on which rules apply, that silence is the record, and it is worth a written query to the procuring body before the deadline.

Where compliance management software earns its place

A sheet works to about twenty live bids. Past that, the rows are in three sheets, the certificate that supported a point has expired since, and the person who owned the register has moved on. Compliance management software for a South African supplier to the state has to hold three things together. The bid with its rules and date, the evidence behind each point with its own expiry, and the outcome letter. Most of what is sold under that name holds the certificate register and nothing else.

Our banked piece on the supplier due diligence checklist and the debarment register sets out the other half of this: what the buyer will check about you. This piece is what you will be asked to show about the bid.

That is the record Zorah builds for transformation managers. The asset and compliance register carries each bid as a dated record with the rules, the points and the evidence attached. It is joined to the enterprise and supplier development file, so a change in the rules is a query on the register rather than a search through email. Whatever the court decided, every other supplier will be writing the case note this month. The file is what you will be asked to hand over.

On Monday, take your most recent state contract and try to write its five lines from your own records, without phoning the municipality. The line you cannot write is the one the auditor will ask for.