Public procurement regulation in Ukraine has evolved from 1993 (1993 - first Governmental regulation, 2000 – first Public Procurement Law) to the most recent amendments incorporated in the new the Law of Ukraine “On Public Procurement” (the “New Public Procurement Law” – New PPL). From May 2016 Ukraine is country member of General Procurement Agreement of WTO (World Trade Organisation).
The New PPL introduced important novelties into the procurement system:
- Completely electronic procurement procedures/operations, ensuring free public access to practically all procurement information.
- A new (valid from 2014) definition of the procuring entities, which is similar to the relevant definition of the contracting entities (specifically in the concept of the bodies governed by public law) in the EU Directive 24/2014.
- A drastic decrease in the number of exceptions from the scope of the public procurement rules – decrease from 43 to 18 exemptions (with 2 temporary), most of which are compatible with the EU requirements.
- Only 3 procurement procedures – open tender, competitive dialogue and negotiated procedure.
- E-auction (based on price only or multi-criteria) is sole evaluation method for tender procedures.
- Simplification of participation in tender through “self-declaration approach” (only winner provides documents confirming qualification compliance to requirements).
One of the main novelties was that an open source e-tendering system Prozorro was created. The system was designed at the initiative of civil society organisations and financed by several private IT firms. The system ownership has been transferred to Transparency International Ukraine and later by the end of 2015 – to Ministry of Economic Development and Trade. The e-system integrates useful analytical and monitoring tools - the BI module http://bi.prozorro.org/ and new monitoring forum for issues/disputes DoZorro http://dozorro.org/.
On 29 August 2019 new draft law on Amendments to the Law of Ukraine on Public Procurement was initiated. The amendments went into force in August 2020 and further improved public procurement legislation in Ukraine.
Namely, the new law on Public Procurement enables procuring entities to:
- Protect themselves against price dumping. The system will automatically identify anomalously low price offers, after which a procuring entity will have the responsibility to verify such offers;
- Organize more professional procurement due to the transition from “tender committees” to “authorized procurement officials”;
- Reject participants who failed to implement agreements before;
- Protect themselves against “tender trolls”: it will be impossible to withdraw a complaint;
- Use non-price criteria for assessing proposals;
- Buy certain goods in a timely and effective manner through electronic catalogs — Prozorro Market online market for public entities.
Participants of procurement will be able to:
- Participate in more tenders since all procurement from UAH 50,000 will only be held through Prozorro (based on a new simplified procedure if it is pre-threshold procurement);
- Recover the complaint filing fee if the Anti-Monopoly Committee granted the complaint or left it without review due to the procuring entity eliminating the violations on its own;
- Dispute cancellation of the procedure and rejection of all proposals;
- Fix errors in tender proposals within 24 hours from its submission;
- Unite with other participants to jointly participate in tender proposals;
- Feel better protection due to the procuring entity’s management and authorized officials being personally responsible for violation of procurement legislation.
The TPPR assessment of the PPL allows to conclude that it is quite progressive and well compliant with best international standards (GPA, UNCITRAL, EU). Ukraine leads the rating among the target countries of the TPPR assessment and shows that the legislation promotes a high level of transparency and is user-friendly.
The Public Procurement Reform Strategy and Action Plan (Road-Map) was approved by Resolution No. 175 of the Cabinet of Ministers of Ukraine on 24 February 2016 addresses the development of the public procurement system in the period 2016 to 2022. The Strategy refers to the need to implement EU rules and standards as set by EU-Ukraine Association Agreement, to increase competition in public procurement and the necessity for professionalization and well-structured permanent training activities.
Public Procurement Legislation is available at the following – link.
Public Procurement Portal of Ukraine – link.