The municipality said in a statement it was soliciting more applications so traders could “apply for a slice of the 2010 Fifa World Cup cake”.
Municipalities and Fifa had recently come under attack from hawkers and traders who said they had been excluded from conducting business around World Cup events.
As the continent's biggest economy, South Africa's streets are a magnet for immigrant beggars, who see the country as a step out of poverty.
In the last two months, police in Johannesburg swooped on mainly Zimbabwean blind beggars who roam the busy streets and women who sit with babies at road intersections - much to the anger of rights groups.
"Their presence violates the city bylaws and we arrest them. In many cases those in need, like women with children and disabled people, are referred to places of safety, where they can access welfare services," said Edna Mamonyane, spokeswoman for the Johannesburg Metro Police.
"According to the host-city agreement, the city is legally obligated to provide a stadium and a fan-fest area," said Thembinkosi Siganda, Cape Town's director of economic and human development.
"After a location analysis the city identified the Grand Parade as a fan-fest area and this was approved by Fifa."
The municipality says it biggest concern has always been health issues - and those who will be permitted to trade will have to adhere to the rules. "We invite traders to make the best economic opportunity to make money from the World Cup by selling their food. We will be very strict when it comes to health regulations and they must adhere to that," says Nelson Mandela municipal spokesperson, Kupido Baron.
Malusi Mhlongo, a lawyer for the city, said street traders would continue to trade as normal during the match days at their permanent trading premises.
Advertising without city authority is prohibited within a 100m radius of the Fifa Fan Park and also at the controlled access site outside the perimeter of the stadium.