South Africa Policy, Plans and Priorities
Monetary Policy, Foreign Exchange and Foreign Investors
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- 1.16Public Procurement
- 1.17Intellectual Property
1.15Monetary Policy, Foreign Exchange and Foreign InvestorsThe South African Reserve Bank is the central bank established by Section 223 of the Constitution and regulated by South African Reserve Bank Act (Act No. 90). The primary object of the Reserve Bank is to protect the value of the currency in the interest of balanced and sustainable economic growth. The Constitution provides that the Reserve Bank must perform its functions independently and without fear, favour or prejudice, but there must be regular consultation between the Bank and the Cabinet member responsible for national financial matters, The Reserve Bank is responsible for monetary policy and the Monetary Policy Committee of the Reserve Bank determines interest rates. See Foreign Investment and Capital Mobility above at 3.1. where the Minister responsible for finance has delegated functions relating to foreign exchange flows to the Reserve Bank. 1.16Public ProcurementSection 217(I) of the South African Constitution stipulates that contracts for goods and services must be in accordance with a system that is fair, equitable, transparent, competitive, and cost-effective. The Constitution also confers an obligation for national legislation to set a framework providing for preferential procurement to address the social and economic imbalances of the past. Procurement in South Africa is regulated by the State Tender Act (Act No. 86 of 1968), the Public Finance Management Act of 1999, the Preferential Procurement Policy Framework Act (PPPFA) of 2000, the Policy to Guide Uniformity in Procurement Reform Processes in Government (a Framework for Supply Chain Management), and the general Procurement Guidelines, which are supplemented by individual Accounting Officer's Procurement Procedures. These apply to all national and provincial departments. The National Treasury, through the Public Finance Management Act of 1999, introduced norms and standards for transparency and expenditure control measures, which should include best practices to regulate financial management in the national and provincial spheres of government. The Municipal Finance Management Act (MFMA) extends the same principles to municipalities. All procurement contracts must comply with the Preferential Procurement Policy Framework Act (Act No. 5 of 2000) and implementing regulations which stipulate that preferences must be applied to all tenders regardless of value. The Act provides that the tender process is made more accessible to black people. Tenders are unbundled into smaller tenders to allow smaller enterprises to tender. A point system operates for the award of tenders with a combination of price and preference for targeted groups. The preferences are aimed at supporting SMEs and micro enterprises (SMMEs) and historically disadvantaged individuals (HDIs), women, and physically handicapped people and promoting employment and domestic production including in specific provinces and the rural areas. Preference points are to be awarded on the basis of comparative prices not tender prices. For tenders valued of less than R 500,000, there is an 80/20 split, with 80 points awarded to the lowest price acceptable bid. A maximum of 20 points is awarded to HDIs under the Black Economic Empowerment (BEE) programme depending on ownership, management, and employment goals. Tenders valued over R 500,000 operate on the same basis except the split is 90/10. The contract is to be awarded to the bidder with the highest points unless justified by other developmental objective criteria. Exemption from provisions of the Framework Act might be justified on grounds of public or national security interests. Foreign firms may only bid through a local agent. In 2009 the South African Treasury published a draft set of Preferential Procurement Regulations which are intended to replace the 2001 Regulations under the Act. The aim is to align preferential procurement with the approach to Black Economic Empowerment under the Broad-Based Black Economic Empowerment Act 53 of 2003. This process led to the amendment of the Preferential Procurement Regulations as interim measures to align themselves to the B-BBEE Codes of Good Practice. Most government purchasing takes place through competitive bidding, on invitations for tenders, published in the Government Tender Bulletin, on ministry websites, and sometimes in local newspapers. Where the Tender Board considers it "advisable", bidders are pre-screened to ensure that they can supply the goods or services so that the tender offer is extended to suitable bidders. The Board might consider that invitations to tender for specific supplies or services should be limited to certain bidders. Potential bidders are evaluated in the light of the requirements, and invitations are extended only to bidders found to be suitable. In comparing tenders, the prices are brought to a comparative level by deducting preferences and other benefits, adding delivery and other costs as applicable, and bringing implied contract price adjustments into account. The Board awards price preferences for local content, for products with the SABS marks, and other preferences mandated by the Ministry of Finance. After prices have been brought to a comparative level the lowest is normally chosen. When there are equal-price tenders the Board's General Procedures stipulate the criteria to be followed, including national content. 1.17Intellectual PropertyIntellectual property in South African is protected under the Companies Act of No.71 of 2008. The Companies Act led to the establishment of a new institution,, the Companies and Intellectual Property Commission. It furthermore led to the transformation of three existing company law entities, namely the Take-over Regulation Panel, the Financial Reporting Standards Council and the Companies Tribunal The main functions of the Commission are as follows: • Register companies, co-operatives and intellectual property rights and maintain such a register; • Disclose information on its register; • Promote education about, and awareness of, company and intellectual property law; • Promote compliance with the relevant legislation; • Ensure the efficient and effective enforcement of relevant legislation; • Monitor compliance with and contraventions of financial reporting standards, and make recommendations in this regard; and • Report to, conduct research for, and advise the Minister of Trade and Industry, on matters of national policy relating to company and intellectual property law. The Commission’s mandate can in short be defined as the administration of and performance of all the powers and functions assigned to it by the said Companies Act, 2008 (Act 71 of 2008), as well as Acts referred to in Schedule 4 of the Act. {Section 185 (2) (d) and 187(1) referred}; and other agreements. Within the domain of intellectual propery, the Commission functions within the following Acts:
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