Transfer and Ceding of Contracts. The General Conditions of Contract section 19.1 dictate that the supplier shall not assign, in whole or in part, its obligations to perform under the contract except with the purchaser's prior written consent. Applications for transfers / cession shall be completed and signed by both the transferor and the transferee and countersigned by two parties. Full reasons for the transferring of the contract must be provided and the transferee's ability to carry out the contract must be established and reported to the Accounting Officer or delegate. Unless it is otherwise in the best interest of the Municipality, it is highly unlikely that the transfer will be approved if the Municipality would suffer a loss as a result thereof or if there is an increased risk to the Municipality. The principle of fairness dictates that should the contract be transferred to another provider it must be checked whether the number of preference points scored are at least the same or more than that scored by the original contractor. Thus, it should be indicated if the transfer would have had an influence on the award. However, the circumstances leading to the transfer must be pointed out and taken into consideration. The contractor will raise the issue with the user division in writing where after the user division must comment on the viability of the transfer / cession and submit the request to the SCM unit. The SCM department may solicit the views of the Legal Department on the matter. If the transfer / cession is not viewed favourably for a justifiable reason, the SCM unit must inform the contractor of the decision in writing and provide the user division with the copies of the correspondence for filing purposes. If the transfer / cession is viewed favourably, the SCM unit must involve Legal Services for the purposes of drawing up the transfer / cession documentation. The SCM unit will then prepare an item to be considered by the BEC and BAC prior to recommending to the Accounting Officer for Approval. The SCM unit must facilitate the signing of the transfer / cession by all parties, must forward a copy to the user division and the contractor and must file the original signed transfer / cession documentation appropriately. If the transfer/cession is not approved the original contractor will still be accountable to execute the contract.
