Airports Company South Africa SOC Ltd v Imperial Group Ltd and Others

Airports Company South Africa SOC Ltd (ACSA), an organ of state, issued a Request for Bids (RFB) in September 2017 inviting bids for ten-year car rental concessions at nine airports. The RFB contained pre-qualification and evaluation criteria, including mandatory transformation and B-BBEE requirements, and a preferential scoring system. Imperial Group Ltd, a large car rental company, submitted a bid under reservation and challenged the lawfulness of the RFB, contending that several provisions contravened s 217 of the Constitution and the statutory procurement framework (including the Preferential Procurement Policy Framework Act and B-BBEE legislation). Imperial argued that the pre-qualification criteria would automatically disqualify it at the first stage. The High Court reviewed and set aside the RFB as unlawful and invalid. ACSA appealed to the Supreme Court of Appeal, arguing that the review was premature and that s 217 did not apply because the RFB involved granting concessions and generating revenue rather than state expenditure.

The appeal was dismissed with costs, including the costs of two counsel. The High Court’s order reviewing and setting aside the RFB and the decision to publish it was upheld.

The case affirms that s 217 of the Constitution applies broadly to all contracting for goods or services by organs of state, including concession agreements and revenue-generating arrangements. It clarifies that public procurement obligations are not limited to instances of state expenditure and reinforces strict compliance with the legislative framework governing preferential procurement. The judgment strengthens constitutional oversight of procurement processes at the preliminary tender stage.