Business people in South Africa who do business by responding to tenders do so well aware that empowerment credentials assist in standing a good chance of winning. Companies seeking to win a tender over their rivals will therefore often put in tenders in their own name as well as with an empowerment partner. This carries very real competition risks.
A number of years ago, textile manufacturers Berg River Textiles and Da Gama Textiles were both competing for tenders to supply uniforms to various government departments. In each instance they partnered with black empowerment entities, evidently in the hope that this would be of assistance in winning the tenders. Both fell foul of the competition law provisions regarding collusive tendering.