The Public Procurement Act 28 of 2024 is signed but not yet in force, and the Constitutional Court is still to rule on a challenge by the Western Cape Government, the City of Cape Town, and amaBhungane, who argue that Parliament failed to facilitate reasonable public participation on material amendments as required by section 59(1)(a) of the Constitution. That judgment is pending.
On 16 April 2026, National Treasury published the draft General Public Procurement Regulations, 2026 (the Regulations) and draft Public Procurement Tribunal Regulations, 2026, for public comment. The comment period has since been extended to 15 July 2026, which reflects the breadth of what is being proposed.
The new evaluation model
South Africa is in the midst of one of the most significant reforms of its public procurement framework since democracy. Whatever the Court decides, these regulations signal the direction of travel, and businesses that bid for government work should be paying attention now.
The most material shift is in how bids will be evaluated. Under the current system, price drives the outcome. A bidder offering the lowest price will often prevail, provided it meets the basic threshold requirements and scores sufficient preference points.
Regulation 25 establishes a mandatory threshold-based model that departs materially from the current system. Procuring institutions must now assign weight across four criteria: capability and capacity to deliver, functionality and technical requirements, preference, and price. The first three criteria are each subject to a mandatory minimum threshold of 70%, and a bidder who fails any one is excluded before price is even considered.
For contracts below R20 million, Regulation 56 requires procuring institutions to reserve certain procurement exclusively for identified categories of persons, including black people, black women, women, persons with disabilities, military veterans, youth, and small enterprises within a particular geographical area, provided the bidder demonstrates 100% ownership by that category. Where no qualifying bids are received, the procuring institution must re-advertise the bid or proceed with no preferential procurement, after making reasonable efforts and reporting to the Public Procurement Office and the relevant provincial treasury.
For contracts of R100 million and above, successful bidders must subcontract at least 25% of the total contract value to enterprises 100% owned by South African citizens.
Draft Regulation 64 (6) includes a direct payment mechanism: if a supplier defaults on payment to a subcontractor, the procuring institution may pay the subcontractor directly and deduct that amount from what is owed to the supplier. This is a meaningful protection for smaller businesses historically exposed to delayed or defaulted payments from main contractors, albeit it introduces a new layer of financial risk for suppliers.
Regulation 60 adds a retrospective eligibility requirement. To qualify under section 18, bidders must show that at least 40% of their prior procurement spend was on enterprises that are at least 51% owned and managed by black people, with proof of such compliance. Past procurement behaviour, not just a current B-BBEE certificate, now forms part of eligibility.
One significant tension not resolved by the Regulations is that the measures designed to advance transparency and redress also add layers of threshold compliance, documentation and risk allocation, which will likely lengthen procurement timelines, particularly for relatively small bidders without dedicated compliance resources. Whether the trade-off is justified is, in part, what the public comment process is for.
The constitutional question mark
The current constitutional challenge is procedural, it targets how the Act was passed, not what it does. A successful challenge would remit the Act back to Parliament for proper public participation and not completely bury the reform agenda. Whatever the Constitutional Court decides, the policy instinct behind the legislation i.e. tighter entry controls, traceable transactions and accountability for how preference is actually delivered, is unlikely to disappear.
For now, businesses that bid for government work would do well to start mapping their current B-BBEE spend and subcontracting arrangements against the new thresholds. The comment window closes on 15 July.
Written by Sarah Moerane, a Director and Amogelang Magano, a Senior Associate at Werksmans Attorneys