Sans 10403

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SOUTH AFRICAN NATIONAL STANDARD

Formatting and compilation of construction

procurement documents

Published by Standards South Africa

1 dr lategan road groenkloof private bag x191 pretoria 0001 tel: 012 428 7911 fax: 012 344 1568 international code + 27 12 www.stansa.co.za

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Table of changes

Change No.

Date

Scope

Acknowledgement

Standards South Africa wishes to acknowledge the work of the National Procurement Reform Task

Team of the Ministries of Finance and Public Works, who developed the principles for the formatting

of procurement documents described in the Green Paper on Public Sector Procurement Reform in

South Africa, and the Departments of Public Works and Public Enterprises and the Interministerial

Task Team for Construction Industry Development who have published documents upon which this

standard is based.

Foreword

This South African standard was approved by National Committee STANSA TC 5120.61,

Construction standards, in accordance with procedures of Standards South Africa, in compliance

with annex 3 of the WTO/TBT agreement.

Annexes A to D are for information only.

Introduction

Uniformity in procurement documentation permits the documentation process to be simplified and

computerized; contractors to more accurately price the risks, which they are to assume, and the

effectiveness and efficiency of procurement to be improved (refer to annex A and annex B).

This standard was prepared to establish procedures for the compilation of procurement

documentation for supplies, services and engineering and construction works in a standard format.

The construction industry is a broad conglomeration of industries and sectors which add value in

the creation and maintenance of fixed assets within the built environment. Construction

procurement as such, covers all categories of procurement commonly encountered in other

industrial sectors and is not confined to engineering and construction works. Construction

procurement includes services, supplies, engineering and construction works and disposals in the

form of demolitions.

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Page

Acknowledgement

Foreword

Introduction

1 Scope

... 3

2 Normative reference ... 3

3 Definitions ... 3

4 Format for the compilation of procurement documentation ...

6 4.1 General requirements for procurement documents...

6 4.2 Format for the compilation of procurement documents ...

6 4.3 Applying the compilation format...

9 5 Compilation of procurement documents ...

9 5.1 General ... 9

5.2 The Tender ... 10

5.2.1 Summary for tender opening purposes (optional)... 10

5.2.2 Tender notice and invitation to tender... 10

5.2.3 Tendering procedures... 11

5.2.4 Returnable documents... 12

5.3 The Contract ... 12

5.3.1 General ... 12

5.3.2 Agreements and contract data... 13

5.3.3 Pricing data ... 13

5.3.4 Scope of work ... 14

5.3.5 Site information ... 15

Annex A (informative) Uniformity in procurement documents ... 17

Annex B (informative) Benefits of compiling documents in accordance with SANS 10403 .... 20

Annex C (informative) Classifying contracts in terms of the generic classification of

contracts ... 23

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Formatting and compilation of construction procurement documents

1 Scope

This standard establishes at both prime and subcontract level:

a) a uniform format for the compilation of procurement documents for supplies, services and

engineering and construction works contracts; and

b) the general principles for compiling procurement documents in respect of supplies, services and

engineering and construction works.

NOTE This standard may also be used with some adaptation in the formatting and compilation of concession contracts and contracts involving disposals.

2 Normative reference

The following standard contains provisions, which, through reference in this text, constitute

provisions of this standard. All standards are subject to revision and, since any reference to a

standard is deemed to be a reference to the latest edition of that standard, parties to agreements

based on this standard are encouraged to take steps to ensure the use of the most recent edition of

the standard indicated below. Information on currently valid national and international standards can

be obtained from Standards South Africa.

SANS 10396, Implementing preferential procurement policies using targeted procurement

procedures.

3 Definitions

For the purposes of this standard, the following definitions apply:

3.1 activity schedule

document that breaks down the scope of work into a series of activities to allow contractors to be

paid a lump sum upon the completion of each of the activities

3.2 bill of quantities

document that lists the items of work and the quantities and rates associated with each item to allow

contractors to be paid at regular intervals an amount equal to the agreed rate for the work multiplied

by the quantity of work completed

3.3 contract data

document that states the applicable conditions of contract and associated contract-specific data that

collectively describe the risks, liabilities and obligations of the contracting parties and the

procedures for the administration of the contract

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3.4 contractor

natural or juristic person or partnership who contracts to provide the supplies, services or

engineering and construction works covered by the contract

3.5 employer

natural or juristic person or partnership entering into the contract with the contractor for the

provision of supplies, services, or engineering and construction works

3.6 engineering and construction works contract

contract for the provision of a combination of supplies and services, arranged for the development,

extension, installation, repair, maintenance, renewal, removal, renovation, alteration, dismantling or

demolition of structures, including building and engineering infrastructures

3.7 forms of offer and acceptance

documents that formalize the legal process of offer and acceptance

3.8 forms of securities

documents that provide for the securities required by the employer

3.9 forms for adjudicator appointments

documents that establish the terms and conditions upon which the adjudicator is to be appointed

3.10 list of returnable documents

document that lists everything the employer requires a tenderer to submit with his tender

submission

3.11 pricing instructions

document that provides the criteria and assumptions which it will be assumed in the contract, that

the tenderer has taken into account when developing his prices, or target, in the case of target cost

contracts

3.12 preferential procurement policy

procurement policy that promotes objectives additional to those associated with the immediate

objective of the procurement itself

3.13 procurement

process that creates, manages and fulfils supplies, services or engineering and construction

contracts

3.14 procurement document

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3.15 returnable schedule

document that a tenderer is required to complete for the purpose of evaluating tender offers or a

document which, when a tender offer is accepted, forms part of the subsequent contract

3.16 services contract

contract for the provision of labour or work, including knowledge-based expertise, carried out by

hand, or with the assistance of equipment and plant

3.17 scope of work

document that specifies and describes the supplies, services, or engineering and construction

works which are to be provided and any other requirements and constraints relating to the manner

in which the contract work is to be performed

3.18 site information

document that describes the site as at the time of tender, to enable the tenderer to price his tender

and to decide upon his method of working and programming

3.19 supplies contract

contract for the provision of materials or commodities made available for purchase

3.20 targeted procurement procedure

process used to create a demand for the services and supplies of, or to secure the participation of,

targeted enterprises and targeted labour on contracts in response to the objectives of a preferential

procurement policy

3.21 tender offer

formal offer for the provision of supplies, or to carry out a service or engineering and construction

works, usually at a stated price, which is capable of acceptance and conversion into a binding

contract

3.22 tenderer

natural or juristic person or partnership who submits a tender offer

3.23 tender data

document that establishes the tenderer’s obligations in submitting a tender and the employer’s

undertakings in administering the tender process and evaluating tender offers

3.24 tender notice and invitation to tender

document that alerts prospective contractors to the nature of the supplies, services and engineering

and construction works required by the employer and contains sufficient information to solicit a

response.

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4 Format for the compilation of procurement documentation

4.1 General requirements for procurement documents

Procurement documents should in general

a) require tenderers to submit particulars sufficient for the employer to evaluate their tenders and to

assess their status, capabilities and capacities to perform the contract,

b) set out in a clear and unambiguous manner criteria by which tenders are to be evaluated,

c) define the risks, liabilities and obligations of the parties to the contract,

d) define the nature, quality and quantity of supplies, services or works to be provided in the

performance of the contract, and

e) use clear and unambiguous language.

4.2 Format for the compilation of procurement documents

4.2.1 Division of documents

Procurement documents for supplies, services and engineering and construction works comprise a

number of component documents dealing with different topics grouped together in a logical

sequence. The first group of documents should contain only those documents that are relevant to

the tender (see table 1) and the second group, those documents that relate to the contract that will

be created at the acceptance of the tender (see table 2).

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Table 1 ― Documents that relate to the tender

1 2

Number Document Tendering procedures:

T1.1 Tender notice and invitation to tender T1.2 Tender data

Returnable documents:

T2.1 List of returnable documents T2.2 Returnable schedules

Table 2 ― Documents that relate to the contract

1 2

Number Document Part 1: Agreements and contract data

C1.1 Forms of offer and acceptance C1.2 Contract data

Part 2: Pricing data

C2.1 Pricing instructions C2.2 Activity schedule / Bill of quantities

Part 3: Scope of work

C3 Scope of work

Part 4: Site information

C4 Site information

4.2.2 Compiling tender documents

Tender documents should comprise three volumes. The first volume should contain only those

documents relevant to the tender procedures, the second volume the returnable documents and the

third volume should contain those documents that relate only to the draft contract (see table 3).

Although the tenderer receives three volumes when the tender document is collected, only the

tender returnables (Volume 2) are returned as the tender offer.

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Table 3 ― Standard headings and sequencing of documents in tender documents

1 2 3 4

Volumes Contents Number Description Number Heading

Tendering procedures

T1.1 Tender notice and invitation to tender Volume I Tendering

procedures

T1.2 Tender data

Returnable documents

T2.1 List of returnable documents

C1.1 Form of offer and acceptance (if acceptance is combined with offer)/Form of offer

C1.2 Contract data (if relevant)

C2.2 Activity schedule / Bill of quantities Volume 2 Returnable

documents

T2.2 Returnable schedules

Part 1: Agreements and contract data

C1.1 Form of acceptance (if separate from form of offer)

C1.2 Contract data (if not included in volume 2)

C2.1 Pricing instructions

C3 Scope of work

Volume 3 Contract

C4 Site information (if relevant)

NOTE: It is possible to compile documents in a single volume using the sequence of documents listed in tables 1 and 2.

The documents listed in table 1 would be headed “Tender” and the documents listed in table 2, “Contract”. The list of returnable documents identifies which of the documents a tenderer must complete when submitting its tender offers. The tenderer submits his tender offer by completing those forms, signing the "offer" document in the forms of offer and acceptance and delivering it back to the employer bound up in the same volume that it was in when it was received. If the tender offer is accepted, the employer simply signs the ‘acceptance’ document in the forms of offer and acceptance and a contract is formed, i.e., the tender document becomes the contract document. This approach is, however, only suited to contracts and situations where small variances, if any, are anticipated between the draft contract and the final contract.

4.2.3 Compiling the contract

If the tender offer is accepted, the employer signs the ‘acceptance’ section in the forms of offer and

acceptance after assembling the contract from the appropriate tender returnables and the draft

contract contained in Volume 3. Schedules that form part of the contract are included in the scope

of work. In this way the tendering procedures (Volume 1) and certain of the tender returnables

(Volume 2) that relate solely to the evaluation of tender offers are excluded from the contract.

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4.3 Applying the compilation format

4.3.1 Guiding principles

A guiding principle using the compilation format is that “the contract is the contract” and

anything relating to the process of tendering (as distinct from the content of the tender) is not

included in the contract, since it is no longer relevant after the submission of the tenders. To

include matters relating to both in the contract will inevitably lead to ambiguities and adversarial

relationships during the execution of the contract as each party will argue about which

statement applies, what the contractor allowed for in his tender, and indeed, what did the

parties actually contract to do.

The content of each component document should be such that, as far as possible, each subject

matter is addressed only once in the procurement document and in its logical location.

4.3.2 Compilation procedures

The compilation format described in 4.2 should be utilised as follows:

a) contracts, should in the first instance, be categorised as being for supplies, services or

engineering and construction works (see annex C for further guidance);

b) where no tenders are called for, Volume 1 (tender procedures) falls away;

c) the provisions of Volumes 1 and 2 will fall away once the contract is concluded as they are no

longer relevant, save for documents extracted from the returnables which are included in the

contract, e.g. the contractor’s data, prices, the offer and some of the returnable schedules; and

d) all documents listed under the contract (Volume 3)

should be supplied as part of the tender as

they represent the proposed or draft, contract.

5 Compilation of procurement documents

5.1 General

The content of each section and subsection of the compilation format presented in 4.2 is outlined in

5.2 and 5.3.

Compilers should ensure that the content of procurement documents satisfies the requirements of

4.1 and adheres to the provisions of 4.3.

The pages of each section and subsection in tender documents should, ideally, be printed on

differently coloured paper or be separated by coloured paper for easy identification, in accordance

with the provisions of table 4.

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Table 4 ― Colours used to distinguish sections in tender documents

1 2 3

Document Colour of pages

Number Heading

White T1.1 Tender notice and invitation to tender

Pink T1.2 Tender data

Yellow T2.1 List of returnable documents Yellow T2.2 Returnable schedules Yellow C1.1 Forms of offer and acceptance

Yellow C1.2 Contract data

Yellow C2.1 Pricing instructions Yellow C2.2 Activity schedule / Bill of quantities

Blue C3 Scope of work

Green C4 Site information

NOTE 1 Contractors submitting tenders will only need to complete the yellow pages for their tender submissions.

NOTE 2 It is not essential to colour code the different sections. Where this is done, the colours should be as described.

5.2 The Tender

5.2.1 Summary for tender opening purposes (optional)

It may be desirable, in some instances, for employers to include a form entitled "summary for tender

opening purposes" as the first page of a tender document to facilitate the reading out of tender

parameters during the public opening of tenders. This optional section should capture the name of

the contractor submitting a tender and the basic details of his offer. It is, however, essential that a

statement in this section be made to the effect, that in the event of any conflict between the data

provided in the summary and that given in the tender, the latter shall apply.

5.2.2 Tender notice and invitation to tender

5.2.2.1 Overview

The tender notice is a brief document, usually not more than one page in length. Its function is to

alert tenderers to the nature of the supplies, services and engineering and construction works

required by the employer and should contain sufficient information to enable them to respond

appropriately. The tender notice and Invitation to Tender should not form part of any subsequent

contract.

5.2.2.2 Minimum information

The tender notice and invitation to tender should, as a minimum, contain

a) the tender or contract reference number,

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c) a brief description of the supplies, services or engineering and construction works which are

required,

d) the closing date, time and place for submission of tenders,

e) the date, time and place of the compulsory site inspection or briefing session, if any, and

f) the time and place for collecting the procurement documents.

5.2.2.3 Reference to matters affecting the evaluation of tenders

Reference to any procurement activity codes or classifications used by the employer should also be

included in the tender notice and invitation to tender. Where targeted procurement procedures are

incorporated in the procurement documents, reference should be made to the targeting strategy

that is being followed. (See clause 6 of SANS 10396:2003). Reference to evaluation criteria or

qualification requirements should also be made.

NOTE The press advertisement or the letter of invitation to specific firms to submit tenders is frequently reproduced as the tender notice and invitation to tender.

5.2.3 Tendering

procedures

5.2.3.1 Tender data

5.2.3.1.1 The tender data informs tenderers about the tendering procedures that are to be

observed and the documentation that needs to be submitted with tender offers, failing which, tender

offers may be rejected or not be evaluated. The tender data does this by identifying the conditions

of tender or the conditions of tender that are generally applicable to procurement and establishes

the variables relating thereto.

NOTE 1 Annex I of SANS 10396:2003 provides guidance on the compilation of the tender data where targeted procurement procedures are used to implement certain preferential procurement policies.

NOTE 2 Conditions of tender can be drafted as a standard set of rules for a particular employer. As such these conditions are usually generic in nature and are rarely contract specific. As a result, it is common for an employer to develop its own standard conditions of tender and to vary them on a contract specific basis.

5.2.3.1.2 The tender data should make reference to both the items comprising the tender and the

proposed contract so that those submitting tender offers can confirm that they have all the

necessary documentation to do so.

5.2.3.1.3 Conditions of tender should cover topics which include eligibility and qualifications criteria,

cost of tendering, checking of documents, confidentiality and copyright of documents,

acknowledgement of addenda, site visits and/or clarification meetings, seeking of clarifications,

pricing of tender offer, alterations to tender offers, alterations to documents, the submission of

tender offers, tender offer validity periods, clarification of tender offers after submission, submission

of securities, bonds and insurance policies, responses to requests for clarifications, issuing of

addenda, returning of late tender offers, opening of tender offers, non-disclure, grounds for rejection

and disqualification, testing for responsiveness, non-responsive tender offers, rectification of

arithmetical errors, evaluation of responsive tender offers, evaluation criteria, preferences,

insurance provided by the employer, acceptance of the tender offers, issuing of notices to

unsuccessful tenderers, and the issuing of the final contract.

NOTE Annex I of SANS 10396:2003 provides sample conditions of tender relating to targeted procurement procedures used to support certain preferential procurement policies.

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5.2.4 Returnable documents

5.2.4.1 General

5.2.4.1.1 This section refers to documents that are returned with, or constitute, a tender. Whilst

many of the returnables are required for the purpose of evaluating tenders, some will form part of

the subsequent contract, as they form the basis of the tender offer. For this reason, it is very

important that all tenderers return all information requested.

5.2.4.1.2 Forms and certificates that are to be completed after the award of the contract must not

be included in the returnable documents, for example site appointments for compliance with health

and safety legislation.

5.2.4.2 List of items comprising the tender

5.2.4.2.1 The list of items comprising the tender is a useful tool which, if prepared and used

correctly, ensures that everything the employer requires a tenderer to submit with his tender offer is

listed. This list obliges the employer to identify exactly what he wants and provides a useful basis of

determining, at the outset, whether a tender offer is responsive.

5.2.4.2.2 The list of returnable documents should also indicate which of the schedules are for

evaluation purposes and which will form part of the contract.

5.2.4.3 Returnable schedules

Returnable schedules comprise those schedules that are used for evaluation purposes only such as

a certificate for signatories, a certificate of attendance at clarification meetings, tender securities, a

form of intent to provide a tender bond, experience of a tenderer, and proposed subcontractors, and

those that are included in the subsequent contract such as curricula vita of key personnel, quality

plans, management plans and preferencing schedules. Returnable schedules that are used for

evaluation purposes only should not form part of the subsequent contract. Returnable schedules

that form part of the subsequent contract should be attached to the scope of work.

5.3 The Contract

5.3.1 General

At the tender stage, all documents listed in table 2 constitute the draft contract. The draft contract

becomes the contract when the forms of offer and acceptance are signed by both parties and

certain of the returnable schedules are inserted into the scope of work.

NOTE In supplies contracts where tenderers are required to submit specifications, in service contracts where tenderers are required to submit proposals in order to satisfy employer’s briefs, and in engineering and in construction works contracts where tenderers offer to design and build facilities, the process between the receipt of a tender offer and the acceptance of the tender offer and conclusion of a contract may necessitate numerous changes to some of the documentation to accommodate various proposals.

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5.3.2 Agreements and contract data

5.3.2.1 Forms of offer and acceptance

The forms of offer and acceptance should contain

a) the offer to provide the supplies, services or engineering and construction works for a price, or in

accordance with the terms of the financial proposal made,

b) confirmation from the employer that he accepts the tender offer following his tender evaluation,

and that a contract therefore exists, and

c) a schedule of deviations which records any agreed changes to the documentation that occur

between receipt of the tender offer and award of contract.

NOTE The schedule of deviations documents the agreed departures from the tender documents. This schedule is important in public sector contracts as it serves as a record of the outcomes of any negotiations between offer and acceptance.

5.3.2.2 Contract data

NOTE The forms of agreements such as the forms of security (e.g. parent company guarantee, performance security (demand guarantee), advanced payment guarantee, etc.), and the form of agreement for the appointment of an adjudicator, and the requirements to complete these, are normally obligations of the contract between the parties. The form of these agreements is usually prescribed by the contract between the parties.

5.3.2.2.1 The contract data establishes the conditions of contract that describe the responsibilities,

liabilities and obligations of the contracting parties and the agreed procedures for the administration

of the contract. Where these terms have been standardized, the contract data identifies the

applicable standard conditions of contract and sets out all the contract-specific variables, data

schedules, appendices, etc., that the parties are required to provide during the tender process.

5.3.2.2.2 Standardized conditions of contract need not be issued with a tender or included in the

final contract document, but should be referred to as being part of the contract. Information should

also be made available as to where copies of these documents can be obtained.

5.3.3 Pricing

data

The pricing data comprises the pricing instructions and the activity schedules or bills of quantities.

The pricing instructions describe the criteria and assumptions which will be assumed in the contract

that the tenderer has taken into account when developing his prices, or target in the case of target

and cost reimbursable contracts. The activity schedules or the bills of quantities records the

contractor's prices for providing supplies, services, engineering and construction works in

accordance with the requirements of the scope of work.

NOTE The terms of payment and the provisions for price adjustment for inflation, if applicable, are established in the contract data. These items should not be described in the pricing data.

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5.3.4 Scope of work

5.3.4.1 General

5.3.4.1.1 The scope of work should identify the supplies, services, or engineering and construction

works which are to be provided during the contract and establish requirements and constraints

relating to the manner in which the contract is to be performed. The scope of work also provides

sufficient information to enable tenderers to price and plan the requirements for the contract to

satisfy the employer’s requirements and expectations in the performance of the contract. The

content of the scope of work will differ between categories of contract, i.e. between supplies,

services and engineering and construction works and will vary significantly from contract to contract.

5.3.4.1.2 SANS 10396 provides guidance on the information that should be included in this section

where targeted procurement procedures are adopted to implement a preferential procurement

policy.

NOTE 1 Specifications should describe the state of the delivered supplies or completed services / works (i.e. what is to be left behind after the contract) and any constraints on how the contract is to be executed after the award of the contract.

NOTE 2 Reference to a process applicable prior to the award of a contract must not be included in the scope of work. This information should be requested in the tendering procedures.

5.3.4.2 Supplies contracts

The scope of work (see annex D for further guidance) should include information on items such as

a) description of the supplies to be supplied / scope of the contract,

b) applicable standards,

c) variations to standardized specifications, and

d) information pertaining to issues such as

1) specific

requirements,

2) place of delivery, and

3) time for placing of orders and rate of delivery.

5.3.4.3 Services

contracts

The scope of work (see annex D for further guidance) should include information on items such as

a) description of the services to be provided,

b) applicable standards / standardized briefs,

c) variations to standardized specifications, and

d) information pertaining to issues such as

1) specific

requirements,

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3) background information pertaining to the required services,

4) terms of reference,

5) time frames for deliverables / milestone dates,

6) the places for the performance of specific tasks, and

7) reporting

requirements.

5.3.4.4 Engineering and construction works contracts

The scope of work for engineering and construction works (see annex D) is largely dependent upon

the contracting strategy that is adopted by the employer, but should generally include information

on items such as

a) description of the works,

b) design brief including design data performance requirements, if applicable,

c) applicable standards:

1) construction and management requirements for works contracts

2) targeted

procurement

3) construction works

4) materials

standards

5) particular

specifications

d) specification data (contract specific provisions and variations to the standardized specifications),

e) list of employer's drawings, and

f) information relating to existing services, site establishment.

NOTE The content of this section is to a large extent dependent upon the contracting strategy which is adopted, for example traditional pre-planned, design and build, develop and construct, etc. Guidance on the preparation of the clauses for inclusion in this section may be found in annex D.

5.3.5 Site

information

5.3.5.1 Overview

Documentation included in this section should describe the site as at the time of tender to enable

the tenderer to price his tender and to decide upon his method of working and programming.

Normally only actual information about physical conditions of the site and its surroundings is

included in the site information and interpretation is a matter for the tenderer. However, some

employers may wish to include interpretative information, such as inferred geological sections, or

site class designations. In the case of refurbishment projects, site information would be the ‘as-built’

drawings of the existing structure.

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5.3.5.2 Content

Site information may include

a) subsoil investigation, borehole records and test results,

b) reports obtained by the employer concerning the physical conditions within the site or its

surroundings including mapping, hydrographic data, and hydrological information,

c) references to publicly available information about the site and its surroundings such as published

papers and interpretations of the geotechnical investigation,

d) information about piped and other services below the surface of the site for contracts involving

ground works, and about hook-up and boundary details for contracts with plant interfaces, in

addition to anything about the physical site which impacts upon the contract,

e) information about adjacent buildings and structures, and about existing buildings and structures

on the site (restrictions for heavy loads etc.), and

f) atmospheric and environmental criteria.

NOTE 1 Should the actual conditions on site turn out to be different to those described, then under most conditions of contract, the contractor would have a claim for compensation or extension of time.

NOTE 2 Matters relating to site facilities, access, places for delivery, etc. are not site information and should be included in the scope of work, as they are constraints on how the contractor executes the contract.

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Annex A

(informative)

Uniformity in procurement documents

A.1 Introduction

A.1.1 The Green Paper on Public Sector Procurement Reform in South Africa (Ministries of

Finance and Public Works, 1997) identified procurement documentation as being one of the areas

that prevents small and medium enterprises and emerging businesses from competing freely for

public sector contracts. This paper highlights the following in this regard:

a) the use of highly technical language, jargon and ‘legalese’ makes documentation

incomprehensible to many businesses;

b) documents are often poorly written and difficult to understand;

c) the layout and packaging of tender documentation is generally not methodical, and is therefore

confusing. Frequently, conditions of tender are mixed with conditions of contract and are

interspersed with technical specifications. This lack of discipline in the drafting of documents is

very confusing to those who have not had considerable exposure to such documents;

d) frequently, the standard conditions of tender and conditions of contract are drafted to cater for

every conceivable eventuality and no attempt is made to present conditions appropriate to

relatively simple and straightforward contracts;

e) various public sector procurement units use different tender documentation which requires

contractors to invest time in order to familiarise themselves with differing documents; and

f) standard forms of contract or specifications, particularly in the case of engineering and

construction works contracts, are often extensively amended by public sector employers.

Invariably, the list of amendments grows over a period of time as amendments are rarely

withdrawn. These documents are extremely confusing and difficult to comprehend.

A.1.2 Currently each industry sector and different organs of the State have their own ideas and

practices for the format and nomenclature used within a tender and contract document. Each

industry sector has also tailor-made its format and specification practices to suit its own general

conditions of contract. This is fine until work of another sector is included within a contract scope,

or other conditions of contract, such as international conditions required by funding agencies, are

used. Frequently those responsible for preparing procurement documents randomly mix conditions

of tender, conditions of contract, specifications and measurement and payment terms. This has

resulted in documentation being complex and ambiguous in the allocation of ill-defined and

unacceptable risks to contractors and increased tendering costs.

A.2 Benefits of uniformity in procurement documents

The Green Paper argues that uniformity in contract documentation will promote or result (or both) in

a) effective participation by new entrants or emerging enterprises to the business environment,

b) cost effectiveness, both in financial and human resource terms,

c) understanding and interpretation by new entrants or emerging contractors,

d) the simplification of the documentation process,

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e) contractors being able to more easily determine the scope and extent of risk,

f) the management of a contract becoming routine and administration procedures becoming

mechanized, and

g) savings in cost and improvement in quality.

For uniformity to be effective, it should be implemented by all organs of the State, including

parastatals, and the private sector.

A.3 Green Paper principles and proposals

The principles and proposals set out in the Green Paper in respect of uniformity in procurement

documents were as follows:

a) there should be complete separation in contract documentation between conditions of tender,

conditions of contract, specifications and terms of payment (including methods of measurement);

b) a generic categorisation of contracts should be developed in order to regulate and administer

public sector procurement activity in a uniform manner;

c) a national standards body should publish and distribute both human resource and technical

specifications;

d) standard conditions of contract, based on the generic categorization and classification of

contracts, should be used by all organs of the state with minimal project specific amendments;

e) government should play a leading role in the standardization of contract documentation and

contract options and set an example in this regard for the private sector;

f) construction standards common to all disciplines should be developed for engineering and

construction works contracts; and

g) engineering and construction works contracts should be drafted in such a way that they cater for

a “hierarchy” of projects in terms of complexity and needs.

A.4 Implications of Green Paper proposals

A.4.1 The first proposal, namely that “there should be complete separation in contract

documentation between conditions of tender, conditions of contract, specifications and terms of

payment (including methods of measurement)”, Section 2.4.6 Principles and proposals of the

Green Paper a public sector procurement reform South Africa (April 1997) sets the framework for

procurement reform in the area of procurement documentation. The rest of the above mentioned

proposals add substance to this framework.

A.4.2 The implications of this proposal are that

a) each subject within a tender and within the subsequent contract can only be addressed once

and in a specific place,

b) issues relating to the tender will fall away once the contract is in place,

c) changes in conditions of contract should not affect other aspects of the contract such as

specifications, measurement and payment,

(21)

d) many of the current standardized specifications need to be extensively revised as they make

reference to conditions of contract, methods of measurement and / or terms of payment,

e) stand alone systems of measurement, independent of specifications are required,

f) specifications need to be written independently from conditions of contract, and

g) a standard format for all contracts can be developed.

A.4.3 The implications of the other proposals include

a) standard conditions of tender and contract, based on the generic categorisation and

classification of contracts, should be used, with minimal project specific amendments,

b) terms, words and documents that specify and describe the process of tendering should not be

included in a contract, and

c) within the contract itself there must be a clear division of documents which address

1) the overall agreement,

2) conditions of contract and associated contract data (or variables),

3)

contract

prices;

4) specifications and drawings which describe the works, services, supplies and state any

constraints on how the works, services, supplies are to be provided, and

5) information about the site, at the time of tender, upon which the contractor bases his price.

A.4.4 Observance of the foregoing is expected to

a) minimize ambiguity and errors in and between the documents which make up a contract for the

provision of the works, as component documents will perform singular functions, and the subject

material contained in the documents is addressed, as far as possible, once only and in a specific

place, and

b) enable all contracts to be developed in the same format using any of the modern delivery

systems coupled to national and international standard forms of contract.

(22)

Annex B

(informative)

Benefits of compiling documents in accordance with SANS 10403

B.1 The generic categorisation of contracts into supplies, services and engineering and

construction works enables the contracting environment to be rationalised, simplified and regulated.

Should employers

a) prepare standard procurement packages for the full range of generic categories of contracts and

the main sub-categorisations complete with standard forms, conditions of tender, data forms, etc

in accordance with the framework provided in this standard,

b) prepare compiler guides to assist those responsible for preparing procurement documents to do

so, and

c) create an electronic library of such documents,

then procurement documents can be compiled routinely as illustrated in the process flow chart

contained in figure 1.

(23)

Figure 1 ― Process flow chart for the compilation of procurement documentation

from an electronic library

Decide on generic classification of contract

Compile procurement document, as directed in relevant compilers guide

Invite, receive and evaluate tender offers

Determine which subcategory of procurement document applies

Go to electronic library and obtain latest procurement documents and associated compilers guide for selected subcategory

Read compilers guide and obtain necessary forms and data sheets from electronic library and any other documents that may be required

Draft non-standard procurement documents and insert project specific data in standard documents in accordance with guidelines provided in the selected compilers guide

(24)

B.2 Employers can also make extensive reference to standard documentation and compile only

those documents or portions thereof that need to be purpose-written for a project and insert project-

specific data or variables in standard templates. The actions which compilers will need to take in

respect of each and every heading in such circumstances are tabulated in table B.1.

Table B.1 ― Compiler’s actions where an employer has developed a

standardized procurement package

1 2 3 4

Volumes

Number Description Standard heading Compiler’s actions Tendering procedures

Tender notice and invitation to tender

Insert tender specific data in pro forma document Volume I Tendering

procedures

Tender data Insert tender specific data in pro forma document

Returnable documents

List of returnable documents

Modify list in pro forma document

Forms of offer and

acceptance Insert standard documents with or without minor project specific data. Contract data (if relevant) Insert contract-specific data in pro forma

document Activity schedule / Bill of

quantities

Develop purpose-written document using standard templates

Volume 2 Returnable documents

Returnable schedules Select from library the required schedules and insert into volume.

Pricing instructions Develop purpose-written instructions using the standard template or select standard instructions from library and insert into volume.

Scope of work Develop purpose-written instructions using the standard template

Volume 3 Contract

Site information Develop purpose-written instructions using the standard template

B.3 Contractors who are familiar with an employer's standard procurement package will merely

have to read the tender/contract specific sections of the procurement document. Contractors who

are unfamiliar with an employer's standard procurement package should be able to readily locate

any information that they may require.

(25)

Annex C

(informative)

Classifying contracts in terms of the generic

classification of contracts

C.1 Contracts other than those associated with concessions and disposals are classified in

terms of the generic classification of contracts as being, engineering and construction works

contracts or services contracts or supplies contracts. Guidance is, however, necessary to enable

those responsible for compiling procurement documents to determine for a specific contract, which

generic definition applies. Listing typical procurement activities and grouping them under the three

headings can facilitate this. In order to do this a classification of procurement on the basis of

procurement activity is required.

C.2 There is no universal system for categorising clusters of supplies and services. The

European Union has developed a Common Procurement Vocabulary (CPV), based on the

Classification of Products by Activity (CPA); a classification which reflects the industrial structure of

the European Community.

1

This CPV serves as a tool for improving transparency and efficiency in

the field of public procurement within the European Union. The use of standard terms in the CPV

makes it easier for potential suppliers to identify the procurement contracts in which they are

interested. (The CPV also facilitates fast and accurate translation of contract notices for publication

in the EU Official Journal, and makes it easier to establish procurement statistics.)

C.3 Procurement Activity Sectors (see table C.1) can be established from the main headings in

CPV. The linking of Procurement Activity Sectors to the European Union's CPV enables

procurement activities to be readily related to a procurement sector as there are more than 8 000

descriptors to describe specific procurements (see

http://simap.eu.int

.).

2

C.4 The abovementioned definitions for engineering and construction works, supplies and

services and are compatible with the European Union’s CPV. Clusters of procurement activities can

be grouped under each of these generic classifications for contracts as shown in tables C.1 and

C.2. Tables C.1 and C.2 enable compilers of procurement documents to rapidly determine the

generic classification of a particular contract.

1 The Common Procurement Vocabulary was developed by the European Union as it was recognised that the Classification of Products by Activity was supplier-oriented rather than purchaser-oriented. Consequently, many changes were needed to produce a purchaser-orientated vocabulary.

2 The linking of Procurement Activity Sectors to the European Union's Common Procurement Vocabulary obviates the necessity to provide procurement officials with comprehensive guidelines to facilitate the correct allocation of individual

(26)

Table C.1 ― Procurement Activity Sectors (summary)

1 2 3 4

# Description # Description

Supplies contracts

1 Agricultural, horticultural, hunting and related products.

18 Chemicals, chemical products and man-made fibres. 2 Products of the forestry and logging industry. 19 Rubber, plastic and film products.

3 Fish, fishing products and other by-products of the fishing industry.

20 Non-metallic mineral products. 4 Coal, lignite, peat and other coal-related

products.

21 Basic metals and associated products. 5 Crude petroleum, natural gas, oil and

associated products. 22 Fabricated products and materials.

6 Uranium and thorium ores. 23 Machinery, equipment, appliances, apparatus and associated products.

7 Metal ores. 24 Office and computing machinery, equipment and supplies.

8 Mining, quarrying and other associated

products. 25 Electrical machinery, apparatus, equipment and consumables. 9 Food products and beverages. 26 Radio, television, communication, telecommunication

and related equipment and apparatus.

10 Tobacco, tobacco goods and supplies. 27 Medical and laboratory devices, optical and precision devices, watches and clocks, pharmaceuticals and related medical consumables.

11 Textiles and textile articles. 28 Motor vehicles, trailers and vehicle parts. 12 Clothing and footwear. 29 Transport equipment.

13 Leather and leather products. 30 Manufactured goods, furniture, handicrafts, special-purpose products and associated consumables. 14 Wood, wood products, cork products,

basketware and wickerwork.

31 Recovered secondary raw materials. 15 Various types of pulp, paper and paper

products.

32 Electricity, gas, nuclear energy and fuels, steam, hot water and other sources of energy.

16 Various types of printed matter and articles for printing.

33 Collected and purified water and water distribution. 17 Petroleum products and fuels.

Engineering and construction works contracts

34 Construction work.

Services contracts

35 Repair, maintenance and installation services. 49 Research and development services.

36 Retail trade services. 50 Architectural, construction, legal, accounting and business services.

37 Hotel and restaurant services. 51 Administration, defence and social security services. 38 Land transport services and transport via

pipeline services.

52 Services related to the oil and gas industry. 39 Water transport services. 53 Agricultural, forestry, horticultural and other related

services.

40 Air transport services. 54 Printing, publishing and related services. 41 Supporting and auxiliary transport services;

travel agencies services.

55 Education services.

42 Postal and telecommunications services. 56 Health and social work services.

43 Public utilities. 57 Sewage- and refuse-disposal services, sanitation and environmental services.

44 Insurance and pension funding services, except compulsory social security services and insurance-related services.

58 Membership organization services.

45 Services auxiliary to financial intermediation. 59 Recreational, cultural and sporting services. 46 Real estate services. 60 Miscellaneous services.

47 Hire services of machinery and equipment and of personal and household goods.

61 Private households with employed persons. 48 Computer and related services. 62 Services provided by extra-territorial organizations

and bodies.

NOTE The European Commission’s CPV codes associated with Procurement Activity Sectors and the related subsectors can be found in table D.2.

(27)

Table C.2 ― Procurement Activity Sectors (expanded)

1 2 3 4 5

PROCUREMENT ACTIVITY SECTOR PROCUREMENT ACTIVITY SUBSECTORS NO. CPV CODE DESCRIPTION CPV CODE DESCRIPTION

SUPPLIES CONTRACTS

01100000-8 Crops, products of market gardening and horticulture.

01200000-9 Live animals and animal products. 01300000-0 Products of mixed farming. 1 01000000-7 Agricultural, horticultural,

hunting and related products.

01900000-6 Agricultural supplies. 02100000-5 Wood.

02300000-7 Cork.

02400000-8 Forestry products. 2 02000000-4 Products of the forestry

and logging industry.

02500000-9 Tree-nursery products. 05100000-6 Fish.

05200000-7 Crustaceans. 05300000-8 Aquatic products. 3 05000000-5 Fish, fishing products and

other by-products of the fishing industry.

05400000-9 By-products of the fishing industry. 10100000-4 Coal and coal-based fuels. 10200000-5 Lignite and peat.

4 10000000-3 Coal, lignite, peat and

other coal-related

products. 10300000-6 Coal-related products. 11100000-1 Crude petroleum. 11200000-2 Natural gas. 5 11000000-0 Crude petroleum, natural

gas, oil and associated

products. 11300000-3 Bituminous or oil shale. 12100000-8 Uranium ores. 6 12000000-7 Uranium and thorium ores.

12200000-9 Thorium ores. 13100000-5 Iron ores. 13200000-6 Non-ferrous metal ores. 7 13000000-4 Metal ores.

13300000-7 Miscellaneous ores. 14100000-2 Stone construction materials. 14200000-3 Sand and clay.

14300000-4 Chemical and fertilizer minerals. 14400000-5 Salt and pure sodium chloride. 8 14000000-1 Mining, quarrying and

other associated products.

14500000-6 Related mining and quarrying products. 15100000-9 Animal products, meat and meat products. 15200000-0 Prepared and preserved fish.

15300000-1 Fruit, vegetables and related products. 15400000-2 Animal or vegetable oils and fats. 15500000-3 Dairy products.

15600000-4 Grain mill products, starches and starch products.

15700000-5 Animal feedstuffs. 15800000-6 Miscellaneous food products. 9 15000000-8 Food products and

beverages.

15900000-7 Beverages. 16100000-6 Tobacco goods. 16200000-7 Tobacco. 10 16000000-5 Tobacco, tobacco goods

and supplies.

16300000-8 Tobacconist supplies. 17100000-3 Textile fabrics and related items. 17200000-4 Textile articles.

17300000-5 Textile yarn and thread. 11 17000000-2 Textiles and textile

articles.

17400000-6 Textile waste. 18100000-0 Workwear. 18200000-1 Outerwear. 18300000-2 Garments.

18400000-3 Special clothing and accessories. 18500000-4 Leather clothes.

18600000-5 Furs and articles of fur. 12 18000000-9 Clothing and footwear.

18700000-6 Second-hand clothing. 19100000-7 Leather.

19200000-8 Leather articles, luggage and saddlery. 13 19000000-6 Leather and leather

products.

19300000-9 Footwear. 20100000-7 Sawn wood.

20200000-8 Wooden sheets and veneers. 14 20000000-6 Wood, wood products,

cork products, basketware

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1 2 3 4 5

20400000-0 Wooden containers, pallets, boxes and other containers.

20500000-1 Articles of wood and cork. 21100000-4 Pulp, paper and paperboard. 15 21000000-3 Various types of pulp,

paper and paper products. 21200000-5 Paper or paperboard articles. 22100000-1 Printed books, brochures and leaflets. 22200000-2 Newspapers, journals, periodicals and

magazines.

22300000-3 Postcards, greeting cards and other printed matter.

22400000-4 Stamps, cheque forms, banknotes, stock certificates, trade advertising material, catalogues and manuals.

22500000-5 Printing plates or cylinders or other media for use in printing.

22800000-8 Paper or paperboard registers, account books, binders, forms and other articles of printed stationery.

16 22000000-0 Various types of printed

matter and articles for printing.

22900000-9 Miscellaneous printed matter. 23100000-8 Refined petroleum products. 23200000-9 Natural gases.

17 23000000-7 Petroleum products and

fuels.

23300000-0 Miscellaneous petroleum products. 24100000-5 Chemicals.

24200000-6 Agro-chemical products.

24300000-7 Paints, varnishes, printing ink and mastics. 24400000-8 Pharmaceutical and medical chemical products. 24500000-9 Glycerol, soaps, detergents, cleaning and

polishing preparations, perfumes and toilet preparations.

24600000-0 Explosives and fine chemical products. 24700000-1 Man-made fibres.

18 24000000-4 Chemicals, chemical

products and man-made fibres.

24800000-2 Various chemical products. 25100000-2 Rubber products.

25200000-3 Plastic products. 19 25000000-1 Rubber, plastic and film

products.

25300000-4 Film products. 26100000-9 Glass and glass products.

26200000-0 Non-refractory ceramic goods and refractory ceramic products.

20 26000000-8 Non-metallic mineral

products.

26900000-7 Miscellaneous non-metallic mineral products. 27100000-6 Basic metals.

27200000-7 Tubes.

27300000-8 Iron and steel products.

27400000-9 Precious metals and metals clad with precious metals.

27500000-0 Aluminium and aluminium products. 27600000-1 Lead, zinc and tin products. 27700000-2 Copper products. 21 27000000-5 Basic metals and

associated products.

27800000-3 Non-ferrous metal products. 28100000-3 Structural metal products.

28200000-4 Metal tanks, reservoirs and containers; central-heating radiators and boilers.

28300000-5 Nuclear reactors and parts. 28400000-6 Cable, wire and related products.

28500000-7 Miscellaneous fabricated metal products and related items.

28600000-8 Cutlery, tools, locks, keys and hinges. 28700000-9 Fasteners, chain and springs. 22 28000000-2 Fabricated products and

materials.

28800000-0 Construction materials and associated items. 29100000-0 Machinery for the production and use of

mechanical power.

29200000-1 General-purpose machinery. 23 29000000-9 Machinery, equipment,

appliances, apparatus and associated products.

(29)

1 2 3 4 5

29500000-4 Special-purpose machinery and parts. 29600000-5 Weapons, ammunition and associated parts. 29700000-6 Domestic appliances.

29800000-7 Miscellaneous equipment. 30100000-0 Office machinery, equipment and supplies

except computers. 24 30000000-9 Office and computing

machinery, equipment and

supplies. 30200000-1 Computer equipment and supplies.

31100000-7 Electric motors, generators and transformers. 31200000-8 Electricity distribution and control apparatus. 31300000-9 Insulated wire and cable.

31400000-0 Accumulators, primary cells and primary batteries.

31500000-1 Lighting equipment and electric lamps. 31600000-2 Electrical equipment and apparatus. 25 31000000-6 Electrical machinery,

apparatus, equipment and consumables.

31700000-3 Electronic, electromechanical and electro-technical supplies.

32100000-4 Electronic valves, tubes and electronic components.

32200000-5 Transmission apparatus for radiotelephony, radiotelegraphy, radio broadcasting and television.

32300000-6 Television and radio receivers, and sound or video recording or reproducing apparatus. 32400000-7 Networks.

26 32000000-3 Radio, television,

communication, telecommunication and related equipment and apparatus.

32500000-8 Telecommunications equipment and supplies. 33100000-1 Medical devices.

33200000-2 Instruments and appliances for measuring, checking, testing and navigating.

33300000-3 Industrial process control equipment. 33400000-4 Optical instruments.

27 33000000-0 Medical and laboratory

devices, optical and precision devices, watches and clocks,

pharmaceuticals and related medical

consumables. 33500000-5 Horological instruments.

34100000-8 Motor vehicles.

34200000-9 Vehicle bodies, trailers or semi-trailers. 34300000-0 Parts and accessories for vehicles and their

engines. 28 34000000-7 Motor vehicles, trailers and

vehicle parts.

34400000-1 Motorcycles, bicycles and sidecars. 35100000-5 Ships and boats.

35200000-6 Railway and tramway locomotives and rolling stock and associated parts.

35300000-7 Aircraft and spacecraft. 29 35000000-4 Transport equipment.

35400000-8 Miscellaneous transport equipment. 36100000-2 Furniture.

36200000-3 Jewellery and related articles. 36300000-4 Musical instruments and parts. 36400000-5 Sports goods and equipment.

36500000-6 Games and toys; fairground amusements. 36600000-7 Miscellaneous manufactured and other goods. 36700000-8 Consumables and consumer goods.

36800000-9 Handicraft and art supplies. 30 36000000-1 Manufactured goods, furniture, handicrafts, special-purpose products and associated consumables. 36900000-0 Special-purpose product.

37100000-9 Recovered secondary metal raw materials. 31 37000000-8 Recovered secondary raw

materials. 37200000-0 Recovered secondary non-metal raw materials. 40100000-3 Electricity.

40200000-4 Manufactured gas.

40300000-5 Steam, hot water and associated products. 40400000-6 Solar energy.

32 40000000-2 Electricity, gas, nuclear

energy and fuels, steam, hot water and other sources of energy.

40500000-7 Nuclear fuels. 41100000-0 Natural water. 33 41000000-9 Collected and purified

water and water

(30)

1 2 3 4 5

ENGINEERING AND CONSTRUCTION WORKS CONTRACTS

General building Civil engineering Electrical and Mechanical Process plant

34 Engineering and

Construction work.

Specialised works

SERVICES CONTRACTS

50100000-6 Repair, maintenance and associated services of vehicles and related equipment.

50200000-7 Repair, maintenance and associated services related to aircraft, railways, roads and marine. 50300000-8 Repair, maintenance and associated services

related to personal computers, office equipment, telecommunications and audio-visual

equipment.

50400000-9 Repair and maintenance services of medical and precision equipment.

50500000-0 Repair and maintenance services for pumps, valves, taps and metal containers, plant and machinery.

50700000-2 Repair and maintenance services related to buildings.

50800000-3 Miscellaneous repair and maintenance services. 35 50000000-5 Repair, maintenance and

installation services.

50900000-4 Installation services.

52100000-0 Retail trade services of food products. 52200000-1 Retail trade services of beverages. 52300000-2 Retail trade services of furniture. 52400000-3 Retail trade services of clothing.

52500000-4 Retail trade services of construction materials. 52600000-5 Retail trade services of printed matter. 52700000-6 Retail trade services of office items. 52800000-7 Retail trade services of horticultural products. 36 52000000-9 Retail trade services.

52900000-8 Retail trade services of medical products. 55100000-1 Hotel services.

55300000-3 Restaurant and food-serving services. 55400000-4 Beverage-serving services. 37 55000000-0 Hotel and restaurant

services.

55500000-5 Canteen and catering services. 60100000-9 Land transport services. 38 60000000-8 Land transport services and

transport via pipeline

services. 60200000-0 Pipeline transport services.

61100000-6 Passenger transport services by water. 61200000-7 Transport by water of freight.

61300000-8 Cable-laying ship services. 39 61000000-5 Water transport services.

61400000-9 Shipping operations 62100000-3 Scheduled air transport services. 62200000-4 Non-scheduled air transport services. 40 62000000-2 Air transport services.

62300000-5 Space transport services.

63100000-0 Cargo handling and storage services. 63200000-1 Support services for land transport. 63300000-2 Support services for water transport. 63400000-3 Support services for air transport. 63500000-4 Travel agency, tour operator and tourist

assistance services. 41 63000000-9 Supporting and auxiliary

transport services; travel agencies services.

63600000-5 Logistics services. 64100000-7 Post and courier services. 42 64000000-6 Postal and

telecommunications

services. 64200000-8 Telecommunications services.

65100000-4 Water distribution and related services. 65200000-5 Gas distribution and related services. 43 65000000-3 Public utilities.