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REFORM OF STATE PROCUREMENT

The state purchases goods, works and services to meet social needs. Annually the volume of public procurement in Ukraine amounts to about 13% of GDP. The Ministry of Economy of Ukraine has the Department of Public Procurement, Competition Policy and Humanitarian Field, which amongst other tasks defines legal policy in the public procurement field and coordinates the work of the public procurement system.

Public procurement reform is one of the most successful reforms in Ukraine. It began in 2014 with the adoption of the Law of Ukraine "On Conduction of Public Procurement", which expanded the list of information to be made public, shortened the list of exclusions from the Law, provided additional powers to the public to control procurement procedures, etc. At the same time, work on the implementation of electronic procurement began during this period.

The main goal of the public procurement reform is to create a modern and effective public procurement system aimed at effective spending of taxpayers’ funds and ensuring the needs of the state and territorial communities, increasing the transparency, competitiveness and professionalism of procurement, as well as gradually bringing the public procurement system of Ukraine into compliance with the standards of the European of the Union in accordance with the timetables determined by the Association Agreement with the EU, the Strategy for Reforming the Public Procurement System ("road map") and the plan of measures for its implementation, approved by the Resolution of the Cabinet of Ministers of Ukraine dated 24.02.2016 No. 175-r. As part of the implementation of the Association Agreement, the representatives of the EU confirmed the success of Ukraine's implementation of the first stage of adaptation of legislation in the field of public procurement to the EU acquis, as provided for in Article 153 of the Agreement.

In February 2015, the electronic procurement system ProZorro, which was created by public activists together with businesses, representatives of authorities, global experts and public organizations, started working in pilot mode. This system, for the first time in Ukraine, allowed suppliers to submit their proposals electronically and made the entire procurement process transparent.

Since April 1, 2016, public procurements through the e-procurement system ProZorro began to be carried out by contracting authorities on the central level and enterprises operating in certain sectors of the economy (so-called "natural monopolies"), and from August 1, 2016, the usage of the e-procurement system became mandatory for all contracting authorities.

Today, the Ukrainian electronic system of public procurement is an information and telecommunications system that ensures procurement procedures, creation, placement, publication and exchange of information and documents in electronic form, which includes the web portal of the Authorized Body (Ministry of Economy of Ukraine), authorized electronic platforms, among which automatic exchange of information and documents is ensured.

All information about any auctions conducted in the electronic system is stored in a central database and is available on the website http://prozorro.gov.ua/, so anyone can go and analyze any procurement and understand whether there was a violation. The Ukrainian procurement system is a hybrid electronic system built on open source principles. The hybrid model, in contrast to mono- and multi-platform ones, means the interaction of the central state module and commercial platforms, when all the information available in the central data base is broadcasted through the platforms that are responsible for customer engagement and service. The development of the system was legally carried out by the NGO Transparency International Ukraine. The system code is completely open, according to the Apache 2.0 license, and can be freely downloaded and used.

Currently, the Ministry of Economy, as the Authorized Body in the field of public procurement, continues active work on the implementation of measures to develop the field of public procurement in the following areas:

- full professionalization of the field of public procurement by abandoning the work format of tender committees and switching to the format of procurement specialists, and/or using the services of centralized procurement organizations;

- automation of procurement processes, development and implementation in the system of additional electronic tools and technical solutions to simplify procurement and increase their efficiency;

- integration of the electronic procurement system with the state electronic systems and registers, gradual transition to electronic tender documentation as part of the electronic procurement system, creation of mechanisms for concluding procurement contracts in electronic form;

- strengthening the control function:

  • by developing and improving the system of automatic risk indicators for objective and timely detection of violations;
  • by increasing responsibility for committed violations.

- harmonization of the Ukrainian procurement legislation to the EU standards.

International recognition and awards received for the development of the electronic public procurement system of Ukraine Prozorro:

- World Procurement Awards 2016 in the "Public Sector" nomination;

- Open Government Awards 2016;

- ProZorro is included in the recommended electronic procurement models of the EBRD;

- ProZorro was selected as a showcase & learning project of the world initiative Open Contracting Partnership Davos Awards 2017 in the nomination "Trust of the Future";

- Fair Sourcing Awards (FSA) 2017 in the "Master" category;

- Based on the results of the assessment of the functioning of the Prozorro electronic public procurement system in 2017, the World Bank recognized that it can use this platform for procurement of goods, services and works in Ukraine;

- Transparent Public Procurement Rating, The most transparent public procurement system 2020.

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