LnP Pulse | Construction Industry Development Board Amendment Bill – will impact both public and private sector procurement
If you carry out construction activities in South Africa (either as a contractor or professional service provider) in the public or private sector, then pay attention to the following proposed changes to the Construction Industry Development Board (“CIDB”) Act.
On 3 May 2024, the Minister of Public Works and Infrastructure published the Draft CIDB amendment Bill calling for public comment.
The Bill introduces some significant changes that impact contractors and professional service provides and is not limited to public sector only.
Here are the 5 key changes:
One: Wider Application when it comes to Construction Works
Construction works is not limited to construction, installation, maintenance, refurbishment, rehabilitation or demolition. It is wider and now covers construction activities ranging from development, repairs, renewals, renovations, alterations, dismantling creation to demolition and refurbishment.
This widens the ambit of the type of work that the Act will apply to.
Two: Application of the Act will include “Professional Service Providers”
The Bill also proposes a new register and registration requirements for “professional service providers”, who are “person(s) who plans, designs or supervises construction works”. This Act will no longer be limited to Contractors only.
Three: Deletion of the requirement for the Contractor to “complete” the Works for the Act to apply
Contractors are no longer those who “undertake” to “execute” and “complete” the works, but now applies generally to the execution only. This appears to remove the additional requirement that a Contractor must not only perform but also complete the works before the Act can apply to it. This removes some ambiguity in the language of the Act, when defining Contractor.
Four: Private Sector Procurement will apply in the same way as Public Sector Procurement
Every organ of state, implementing agent and private sector (employer) must apply the register of contractors and professional service providers to its procurement processes.
Every contractor and professional service provider doing construction works for either public or private sector must be registered with the CIDB and must hold a valid registration certificate.
Five: New Criminal Offences for both Contractors and Professional Service Providers
If a Contractor or Professional Service Provider undertakes construction works in the public or private sector and is not registered with the CIDB it is a criminal offence and will be fined up to 10% of the contract value.
The changes proposed are far reaching and will have massive consequential impacts on contractors and professional service providers executing construction works in South Africa – for both public and private sector.
To understand how these proposed changes might impact your projects and business operations, reach out to LnP Beyond Legal, your experts in construction and project advisory, at info@lnpbeyondlegal.com.
Nikita Lalla, Ricardo Pillay and Mbalenhle Simelane