Biggest court case on BEE and procurement gets even bigger
17 May 2021
The biggest BEE and procurement case to date has just grown even bigger with three well-known organisations moving to participate in Sakeliga's constitutional litigation.
The EFF, the Free-Market Foundation's Rule of Law project, and the security company Fidelity are all three currently in the process of being admitted as respondents and/or friends of the court (amici curiae), for the trial scheduled for 25 May 2021 in the Constitutional Court.
The case stems from an appeal by the Minister of Finance against the Supreme Court of Appeal's finding last year, with costs, in Sakeliga's favour. In that case, the court agreed with Sakeliga that the 2017 procurement regulations, issued by Minister Pravin Gordhan, are illegal and unconstitutional.
The regulations ushered in a new era in BEE-related state procurement: for the first time, state entities could refuse to accept tenders if they did not meet arbitrary BEE requirements, whereas previously, they could only subtract between 10% and 20% of tender points. However, instead of accepting the Supreme Court of Appeal’s ruling, the Minister of Finance soon appealed – inter alia at the public insistence of ANC Secretary-General Ace Magashule – to the Constitutional Court.