With the public commentary period still open, it is useful to reflect on certain categories of regulation that may be particularly significant for procuring institutions and suppliers. This reflection is not intended to be comprehensive, and a more detailed interrogation of these categories will follow in subsequent publications, webinars, or podcast discussions. At present, much like the uncertainty surrounding the validity of the Public Procurement Act itself, the eventual role and practical relevance of the draft Regulations remain in flux and are the subject of ongoing consideration. There remains, however, sufficient time for careful engagement, and stakeholders would be well advised to stay attuned to developments.

The draft Regulations are extensive and signal a material shift in the public procurement regulatory framework, with clear implications for both procuring institutions and current and prospective suppliers to the state. A reflection on selected categories of regulation covered in the draft Regulations is set out below, with notable inclusions highlighted.

Procurement methods

“Less is more”, so it goes, but there are occasions where more is, in fact, more. We do not seek to prescribe which approach prevails here, but it is notable that the draft Regulations provide for a wide range of procurement methods. The traditional routes, which most procuring institutions and suppliers are familiar with, include the: request for quotation (RFQ), request for bid (RFB), and request for proposals (RFP).

The draft Regulations also introduce a number of less conventional mechanisms, including:

• Competitive dialogue, which is an augmented two-stage procedure that may be used on complex projects where specifications are not fully defined or require specialised expertise, employing an iterative process to determine project specifications through structured engagement with shortlisted bidders.
• Unsolicited bids, which may only be considered where the product or service is innovative or presents a new and cost-effective method of service delivery, and the institution has conducted a comprehensive feasibility study establishing a clear business case.
• Procurement from manufacturers, which is permitted where it results in lower total cost (taking into account lifecycle costs), quality assurance or longer warranties, or where the manufacturer falls within a designated set-aside category.
• Competitive negotiation, available where project requirements are not fully defined, require innovative or advanced technological solutions, or in emergency procurement situations.

These alternative approaches warrant closer future consideration as the regulatory framework develops and practice begins to take shape.

Preferential procurement

The draft Regulations treat preferential procurement with the seriousness contemplated by the Constitution by establishing a tiered preferential procurement framework. This framework is structured across value-based thresholds and is likely to have a material impact on increasing participation by previously disadvantaged persons in public procurement. Set-asides apply to contracts not exceeding R20 million in value where there are at least three qualifying suppliers.

Pre-qualification applies to contracts between R20 million and R100 million. Mandatory subcontracting of at least 25% of contract value to identified categories of persons applies to contracts of R100 million and above. Annexure 2 prescribes minimum set-aside targets, including 30% for Black people, 15% for Black women, 18% for women, 18–30% for small enterprises, and specific targets for youth, co-operatives and geographic area-based categories.

Infrastructure procurement

Chapter 3 establishes a detailed framework for infrastructure and capital asset procurement, including requirements for portfolio-level procurement strategies aligned with the National Development Plan, formal independent gateway reviews at key decision points in the lifecycle of projects, and comprehensive risk management including anti-corruption and anti-extortion measures. For major and high-value/high-risk projects, gateway reviews must be conducted by an independent multi-disciplinary team including specialists in engineering, project management, procurement, law, finance and environmental and social impact assessments.

Bid evaluation framework

The draft Regulations introduce a new multi-criteria bid evaluation matrix. Bids will be evaluated on the basis of eligibility criteria, functionality and technical merit, cost-effectiveness, sustainable development and transformation measures, innovation, capability and capacity to deliver, and local content production.

Contract management

Procuring institutions must establish contract management systems that monitor execution and compliance, track progress against deliverables and milestones, manage risks proactively, and support outcome-based performance evaluation. Contract variations are capped at 15% for infrastructure-related goods and services above R100,000, 10% for consultancy services above R30,000 and 20% for all other goods and services. Awards and contracts must be published on official websites within seven days.

Transitional arrangements

The existing Treasury Regulation 16 (public-private partnership (PPP) framework under the Public Finance Management Act 1 of 1999) and Municipal PPP Regulations, 2005 remain in force until replaced by new regulations under the act. Competency requirements for procurement officials will be phased in, with transitional guidelines to be published within 12 months of commencement.

What now?

Notwithstanding the pending constitutional challenge to the Public Procurement Act, stakeholders should consider engaging with the draft Regulations in their current form and submit comments before 15 June 2026. While the ultimate status and form of the regulatory framework remain uncertain, the current process presents a meaningful opportunity to influence its development. As reflected above, the draft Regulations signal a potentially significant shift in the public procurement framework, with far-reaching implications for both procuring institutions and suppliers.