Local Government: Municipal Finance Management Act, 2003 (Act No. 56 of 2003)RegulationsMunicipal Supply Chain Management Regulations, 2005Chapter 2: Framework for Supply Chain Management PoliciesPart 2: Acquisition management38. Combating of abuse of supply chain management system |
| (1) | A supply chain management policy must provide measures for the combating of abuse of the supply chain management system, and must enable the accounting officer— |
| (a) | to take all reasonable steps to prevent such abuse; |
| (b) | to investigate any allegations against an official or other role player of fraud, corruption, favouritism, unfair or irregular practices or failure to comply with the supply chain management policy, and when justified— |
| (i) | take appropriate steps against such official or other role player; or |
| (ii) | report any alleged criminal conduct to the South African Police Service; |
| (c) | to check the National Treasury’s database prior to awarding any contract to ensure that no recommended bidder, or any of its directors, is listed as a person prohibited from doing business with the public sector; |
| (d) | to reject any bid from a bidder— |
| (i) | if any municipal rates and taxes or municipal service charges owed by that bidder or any of its directors to the municipality or municipal entity, or to any other municipality or municipal entity, are in arrears for more than three months; or |
| (ii) | who during the last five years has failed to perform satisfactorily on a previous contract with the municipality or municipal entity or any other organ of state after written notice was given to that bidder that performance was unsatisfactory; |
| (e) | to reject a recommendation for the award of a contract if the recommended bidder, or any of its directors, has committed a corrupt or fraudulent act in competing for the particular contract; |
| (f) | to cancel a contract awarded to a person if— |
| (i) | the person committed any corrupt or fraudulent act during the bidding process or the execution of the contract; or |
| (ii) | an official or other role player committed any corrupt or fraudulent act during the bidding process or the execution of the contract that benefited that person; and |
| (g) | to reject the bid of any bidder if that bidder or any of its directors— |
| (i) | has abused the supply chain management system of the municipality or municipal entity or has committed any improper conduct in relation to such system; |
| (ii) | has been convicted for fraud or corruption during the past five years; |
| (iii) | has willfully neglected, reneged on or failed to comply with any government, municipal or other public sector contract during the past five years; or |
| (iv) | has been listed in the Register for Tender Defaulters In terms section 29 of the Prevention and Combating of Corrupt Activities Act (No 12 of 2004). |
| (2) | The accounting officer must inform the National Treasury and relevant provincial treasury in writing of any actions taken in terms of subregulation (1)(b)(ii), (e) or (f). |