Administrative Justice
Your Business Has No B-BBEE Compliance — We Cannot Award You the Contract
A small business owner is excluded from a government or parastatal tender on the basis of B-BBEE requirements that either do not apply to their business size or have been incorrectly stated.
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The Fallacy
Regulatory Overstatement — Applying Requirements That Do Not Exist at This Scale
The procurement officer applies the full B-BBEE compliance framework to a business that is legally exempt from most of it. The B-BBEE Codes of Good Practice create tiered requirements: larger enterprises (turnover above R50 million) must undergo full B-BBEE verification; qualifying small enterprises (R10m–R50m) use a simplified scorecard; and exempted micro-enterprises (under R10 million) are automatically assigned a Level 4 B-BBEE status and need only submit a sworn affidavit. Demanding a full verification certificate from an EME overstates the legal requirement and unlawfully excludes a class of businesses from competing.
What the Law Says
Your Legal Foundation
Broad-Based Black Economic Empowerment Act 53 of 2003 and Amended Codes of Good Practice
Code Series 000, Statement 003 — Exempted Micro-Enterprises (EMEs)
“An entity with an annual total revenue of R10 million or less qualifies as an Exempted Micro-Enterprise (EME). An EME with no black ownership qualifies as a Level 4 contributor. An EME that is 51% or more black-owned qualifies as a Level 2 contributor. An EME that is 100% black-owned qualifies as a Level 1 contributor. An EME is not required to undergo a formal B-BBEE verification by an accredited rating agency — a sworn affidavit confirming EME status and ownership is sufficient.”
A small business with annual turnover under R10 million does not need a B-BBEE certificate from a rating agency. Submitting a sworn affidavit confirming EME status is the legal requirement. A procurement officer who demands a full certificate from an EME is overstating the legal requirement.
Preferential Procurement Policy Framework Act 5 of 2000
Section 2 and Preferential Procurement Regulations, 2017 — Application of B-BBEE in procurement
“Organs of state must apply B-BBEE principles in procurement as provided for in the regulations. The regulations require that tenderers submit proof of B-BBEE status in the prescribed format for their category. For EMEs, the prescribed format is a sworn affidavit — not a full verification certificate.”
Government departments and organs of state must apply the correct B-BBEE compliance documentation requirement for each size category. Rejecting an EME's tender for failure to produce a full certificate — when a sworn affidavit is the correct requirement — is a violation of the Preferential Procurement Regulations.
Promotion of Administrative Justice Act 3 of 2000
Section 5 — Right to request reasons for administrative action
“Any person who is adversely affected by administrative action and who has not been given written reasons may, within 90 days of being informed of the action, request that the administrator concerned furnish written reasons.”
A small business owner whose tender has been rejected has the right to request written reasons for the rejection. If the reason is a B-BBEE requirement that was incorrectly stated or applied, those written reasons form the basis for a formal challenge or review.
What Scripture Says
God's Word on This
Deuteronomy 25:15 (NET)
“You must use accurate and correct weights and measures, so that you may live long in the land the Lord your God is giving you.”
Using accurate measures — applying the correct standard to each situation — is a principle of justice rooted in Scripture. Government procurement that applies the wrong standard to small businesses, making participation impossible, is a form of inaccurate measure that the law and Scripture both reject.
Proverbs 11:1 (NET)
“The Lord abhors dishonest scales, but an accurate weight is his delight.”
Applying a burden to a small business that the law has specifically removed — whether by oversight or design — is a form of dishonest weight. Knowing the correct standard is how an honest claim is made and defended.
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What They'll Say Next
Common Counter-Arguments
After you respond, they may push back with these arguments. Members get the full rebuttal for each.
They might say: “Our procurement policy says all suppliers must have a Level 2 or above B-BBEE rating. Your EME status gives you Level 4 — you do not qualify.”
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They might say: “Your affidavit is not notarised — it is not acceptable as proof of EME status.”
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