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Local Government: Municipal Finance Management Act, 2003 (Act No. 56 of 2003)

Regulations

Municipal Supply Chain Management Regulations, 2005

Chapter 2: Framework for Supply Chain Management Policies

Part 2: Acquisition management

12. Range of procurement process

 

(1) A supply chain management policy must, subject to regulation 11(2), provide for the procurement of goods and services by way of—
(a) petty cash purchases, up to a transaction value of R2000 (VAT included);
(b) [Regulation 12(1)(b) deleted by section 2(a) of Notice No. 4198, GG49863, dated 14 December 2023];
(c) formal written price quotations for procurement of a transaction value over—
(i) R2000 up to R300 000 (VAT included), in the case of a local municipality;
(ii) R2000 up to R200 000 (VAT included), in the case of a district municipality;
(iii) R2000 up to R750 000 (VAT included), in the case of a metropolitan municipality; and
(d) a competitive bidding process for—
(i) procurement above a transaction value of R300 000 (VAT included), in the case of a local municipality;
(ii) procurement above a transaction value of R200 000 (VAT included), in the case of a district municipality; and
(iii) procurement above a transaction value of R750 000 (VAT included), in the case of a metropolitan municipality

[Regulation 12(1)(c)(d) substituted by section 2(b) of Notice No. 4198, GG49863, dated 14 December 2023]

 

(2) A supply chain management policy may allow the accounting officer—
(a) to lower, but not to increase, the different threshold values specified in subregulation (1); or
(b) to direct that—
(i) [Regulation 12(2)(b)(i) deleted by section 2(c) of Notice No. 4198, GG49863, dated 14 December 2023]
(ii) formal written price quotations be obtained for any specific procurement of a transaction value lower than R10 000; or
(iii) a competitive bidding process be followed for any specific procurement of a transaction value lower than the competitive bidding thresholds specified in subregulation (1)(c)(i) to (iii).

[Regulation 12(2)(b)(iii) substituted by section 2(d) of Notice No. 4198, GG49863, dated 14 December 2023]

 

(3) A supply chain management policy must state—
(a) that goods or services may not deliberately be split into parts or items of a lesser value merely to avoid complying with the requirements of the policy; and
(b) that when determining transaction values, a requirement for goods or services consisting of different parts or items must as far as possible be treated and dealt with as a single transaction.