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Olefir Andriy Oleksandrovych


Med. pravo., 2016; 2(18): 44-54

UDС: 346.12:613/614


PhD, assistant professor, Department of civil, economical and administrative law, Poltava's Institute of Law of the National Law University of Yaroslav the Wise

The Problem of Legal Regulation of Public Procurement

Regulatory support of public procurement is the test of the legal system of Ukraine. Currently there is no systematic work to develop long-term legislation in this field. Recently there had been passed a new Law of Ukraine «On public procurement», in which the most significant corruption risks (rules of qualification, that allows accepting offers of one-day firms, tenders for stakeholders etc., it is not enough narrowed the grounds for negotiation, but at the same time were strengthened formal approaches to the evaluation of bids, insufficient anti-corruption prohibitions, lack of control over the implementation of signed agreements and the formation of purchase prices etc.) were not removed. Ukraine has not implemented the economic (industrial) growth policy and it is more important than the first, because it can provide a strategic competitive state.

In this article the basic institutions of public procurement in the light of changes in legislation were investigated, including: - the peculiarities of e-procurement; - subthreshold procedure for procurement; - legal status of customers; - organization of the tender committee; - two systems of installation of compliens of tender participants concerning the qualification criteria and the requirements of the tender documentation; - order the evaluation of tender propositions; - requirements regarding the public procurement information; - features of the negotiation procedure; - administrative appeal procedures for procurement.

The Law of Ukraine «On public procurement» provides centralized procurement organizations (large customers which can be determined by the Cabinet of Ministers, the Council of Ministers of Crimea, local authorities, for which the organization and procurement will be the main subject of activity) that deserves only the positive assessment. Customers have the choice to create tenders or appoint an authorized person (persons) to organize and procurement. It is important to mention, that there are two systems of how to introduce participants to match the qualification criteria and submit their proposals with the requirements of the tender documentation: (1) after evaluating proposals; (2) the evaluation of proposals.

Procedure for evaluating the tenders suffered significant changes, in particular: - there are no grounds for the use of a mixed system of evaluation of proposals, which is the basis for abuses (to ensure the victory of a particular party), and the assessment is carried out automatically by electronic system based on criteria and methodology specified by the customer at the discretion of the tender documentation; - evaluation can be passed only in a way of electronic auction; - customers take a decision according to the results of the auction on the intention to conclude an agreement (on a positive assessment deserves that last move makes each round of the auction participant who submitted the proposal with the lowest price); - the purchase of all products makes without consideration of qualitative criteria (from the list of non-price evaluation criteria cleaned «quality», however, added «total cost of use (life cycle)», in the case of a mixed system of evaluating the price criterion should not be less than 70 %); - in the case of mixed evaluation system reduced price calculated for all the proposals in each round of the auction. In the face of corruption risks («kickbacks») approach in the interests of corrupt officials who are willing to reduce the price to a level that the standard does not cover production costs.

It should be emphasized that the Directive 2014/24 /EU of the European Parliament and the EU Council «On public procurement and repealing Directive 2004/18 / EU» allows for both competitions and auctions, as well as examples criteria for evaluating proposals identifies the following: quality, including technical advantages, aesthetic and functional characteristics, accessibility, design for all users, social, environmental and innovative characteristics, trade, and its terms, the organization, qualification and experience of the staff working on the execution contract, if the quality of designated personnel could have a significant impact on the contract and so on.

Also we would like to mention such problems of the new law: - abbreviated list of qualifying criteria (availability of equipment, material and technical base; availability of suitably qualified staff who have knowledge and experience; documented experience in executing similar contracts) that are common and are can be set at the discretion of the customer (one or more of them); - customers have the right to decide to refuse participants proposals in procurement and reject the proposal if the party is in arrears with payment of taxes and fees. Providing such a right to the customer without specifying the size of the tax debt, the period of its existence, makes an opportunities for abuse that right and selective application of the rule to obtain undue advantage; - the negative assessment of the merits removal from the list of reasons that entitle the customer to cancel the auction or recognize them as having failed, detection of the collusion of participants who thus violate the law on protection of economic competition (commit anticompetitive concerted actions); - does not contribute to the prevention of corruption that the bidder must provide the customer information about the presence of anti-corruption programs or authorized person of its implementation only if the cost of procurement of goods (goods), services (services) or works is equal to or exceeds UAH 20 million, although the previous version of the law envisaged UAH 1 million for goods and services, 5 million - for work, otherwise this proposal should be rejected by the customer

The Law of Ukraine «On public procurement» finally secured and expanded scope of specialized customers (delivery of medicines, medical devices and related services as well as goods and services to ensure the defense of the State).

The Law of Ukraine «On public procurement» does not solve the main problems in this area, and sometimes even exacerbates them. Negative symptoms include the following: - corruption risks were not eliminated (anonymous participants on the stage of evaluation does not make sense because they can coordinate their behavior during the auction and develop documentation for a particular participant in the tender); - qualification of participants kept to a minimum; - regulation of competition is carried on subordinate level; - unreasonable approach to the total payment for participation in the procurement; - half-improvements (on formal errors and negotiated procedure); - the rejection of the tender procurement forms and criteria of «quality» that has always counted on goods and services, health care and so on. Positive signs include as following: increased transparency and speed of tendering, partially improved the procedure for appeal and negotiation process. Positive changes are mainly resulted from implementation of the Association Agreement between Ukraine and the EU.

As to specialized (international) organizations that purchase, their legalization is the intention to eliminate corruption in procurement without following the principles of transparency and competition, while ignoring the interests of national producers, accompanied by a delegation of sovereign powers to the purchase of goods for state needs to foreign organizations. This practice is common in less developed countries of Africa and Oceania, which are not able to conduct organizational centralized procurement and «mothballed» their own economy.

Key words: public procurement, health protection, auction, tender, customers, tender committee, negotiations procedure, open tender.

Reference list

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