METHODS OF DIVERSION THE PROZORRO SYSTEM

In the preamble of the Law of Ukraine «On Public Procurement» No. 922-VIII of December 25, 2015, this noble goal, namely: ensuring efficient and transparent procurement, creating a competitive environment in public procurement, preventing corruption in this area, developing good faith competition.

All central bodies of executive power, as well as subjects of certain spheres of management in accordance with the Law of Ukraine «On Public Procurements», from April 1, 2016, purchase only through the electronic trading system on authorized electronic platforms. Since August 1, 2016, this norm has become mandatory for all customers.

The Law of Ukraine «On Public Procurements» regulates all relations between the Customer and the Supplier, preceding the conclusion of the contract for the purchase of goods, works or services, starting from the terms of bidding, to resolving possible conflict situations.

However, not all types of public procurement are subject to regulation by this legislative act. In particular, it regulates only the purchase of goods or services by state organizations for an amount equal to or exceeding UAH 200,000. As for the cost of the ordered works, they should exceed the total cost of 1.5 million hryvnia. To customers operating in certain areas of management, provided that the cost of the object of purchasing goods, services is equal to or exceeds 1 million hryvnia, and works - 5 million hryvnia. All other needs of government organizations in goods and services for smaller amounts can be realized through sub-threshold purchases. It should be noted that enterprises that need to purchase goods for less than these amounts have the right to use the rules and procedures provided for by electronic public procurement (the order of the State Enterprise Externaltorgissued Ukraine of April 13, 2016 No. 35).

In the case of sub-threshold purchases, the customer does not need to conduct electronic bidding. This some customers also use, break the purchase into the required number of parts in such a way that each of them does not exceed the threshold amount of 200 000 hryvnia. Therefore, on the electronic system of public procurement, you can often see several purchases of the same product or service at the same time, but by individual contracts for 199,000 hryvnia. Sometimes you can see cases when this amount is bought by one computer.

This circumvention of the system is explained by the fact that in the pre-threshold procurement in the event of a violation, it is only possible to contact the customer with a request to eliminate the violation during the procurement process. The customer within 3 days considers the demand, accepts and publishes the decision on it. In the event that the customer does not respond to the request, it is advisable to leave a response about it or a reasoned complaint about violations on the Dozorro monitoring portal.

If the expected value of the subject of procurement will be from 50 thousand UAH. (with VAT) and up to 200 thousand UAH. (with VAT), the customer will need to publish a report on the concluded contracts in the electronic system.

However, not everything is as bad as it seems: in order to save taxpayers money and prevent corruption risks, many fund managers decided to conduct pre-threshold purchases in the ProZorro system. For example, in Dnepropetrovsk, Zaporizhya, Lviv, Ternopil State Administrations and Kyiv City State Administration, in 2016, electronic auctions were introduced through the ProZorro system for all purchases amounting to more than UAH 50,000. In 2017, the relevant decisions were taken by the Ivano-Frankivsk City Council, the Dneprovsky City Council, the Kyiv City Council, the Lviv City Council, the Khmelnytsky City Council, the Mariupol City Council and others.

For today in system ProZorro restrictions are established, therefore through system it is possible to submit purchases, expected cost of which is not less than 3 thousand UAH.

However, there are other mechanisms for «bypassing» the electronic public procurement system ProZorro.

1. The scheme of deception of the system is the prescribing by the customer of the requirements for «his» supplier.

However, it is practically impossible to prove this. As a rule, when writing out certain conditions, the customer explains that in this way he simply defends himself. Because you can not always choose the cheapest product or service - you need a quality guarantee. After all, if the firm that won the purchase, provided products of inadequate quality, you have to undergo the procedure again.

2. Cases where the state purchases goods at low prices, which are then raised through additional agreements, are common. This way of raising prices for public procurement is a system, this mechanism is used by the parties, bypassing ProZorro and enriching at the expense of the state.

However, it was rather difficult to assess whether additional agreements on a particular procurement were adequately concluded, or whether they contained a corruption component. The mechanism for concluding additional agreements is, firstly, quite legitimate. Secondly, no matter how qualitatively and honestly the tender was conducted, sometimes it is impossible to do without additional agreements. Although the rise in prices should be reasoned and confirmed by the conclusion of the Chamber of Commerce and Industry, however, there is a violation.

3. Illegal disqualification. Concerning the situation, when the company was tendered, and the customer did not recognize correctly its package of documents. The problem is not that someone has submitted the perfect package of documents, but some do not, and in selective justice, when some are not allowed to tender, and others are closing their eyes to breaking others.
4. The next big problem is when the customer (in our case, the «Spetszhitlofond» PP, purchase ID: UA-2018-03-28-000208-b) obliges the participants to submit the draft contract, completed and signed by the participant, in the edition that contains discriminatory conditions.

For example, when payment under the Agreement is effected within 120 working days from the moment of receipt by the Customer of an account on the basis of the act of acceptance-transfer of services rendered by the Parties; The liability of the Participant is not limited solely to the amount of actual damage that arose as a result of the Participant’s guilty actions and/or inactions when providing the Services; the participant is responsible for the violation of the Treaty, if it even occurred not through his fault (intent or negligence); for violation of the deadlines for fulfilling the Customer’s instructions, the Participant is liable in the form of paying a fine in favor of the Client in the amount of the double discount rate of the NBU established on the day of the delay from the amount of the contract for each day of delay. And for the delay of more than 10 calendar days in addition pay a fine in favor of the client in the amount of 50 000, 00 UAH. (fifty thousand UAH 00 kop.); for refusal unilaterally from the performance of obligations under this Agreement, the Participant shall pay a fine in the amount of 200,000.00 UAH in favor of the Client (two hundred thousand UAH 00 kop.); in case of failure to appear or late for more than 30 minutes of the authorized representative of the Participant at the request of the Client for providing legal assistance, the Participant shall reimburse the Client in full for the losses (losses and lost profits) and shall additionally pay a fine of UAH 20,000.00. (twenty thousand UAH 00 kop.) for each non-appearance and/or delay.

The above-mentioned terms and conditions of the contract contradict the market relations and are preliminary aimed at preventing the performance of works and services of economic entities from the real sector of the economy.

5. Special requirements to the winners. «When, for example, within one day after the auction, the supplier is obliged to bring a sample of the goods,» - gave an example of Nefyodov in a conversation with the «Glavkom». - This is a significant barrier. And often, probably, they are written out for a participant who already with that pattern actually sits under the door».

It is popular to make such demands in tender conditions, which can only be performed by a person familiar with them in advance - from the most fuzzy specification of the desired product, such as «device with holder and nozzle», to unrealistic delivery times of several days and requirements to provide certificates and certificates that physically can not be completed before the date of bidding.

6. Officials do not hesitate to block purchases in court. This does not always lead to success, but it depletes uncomfortable competitors, for whom the possible benefits of winning a business can ultimately be less than the costs of lawyers.
7. One of the simplest schemes is participation in the tender «psevdo-firms», which knock down the price, and in case of victory they refuse to sign the contract with the customer. In this case, or a contract is signed with the next winner, or it is necessary to conduct the tender anew.
8. Officials try to «hide» an electronic tender system so that potential participants can not find it, and «trusted» suppliers, of course, learned everything in time. To do this, usually write the name of the tender with grammatical errors, for example, «Purchasing mashyn», qualify it not as an automobile transport, but as «Electrical equipment, other», load unread tender documentation and announce a tender in the hope that it will not be noticed by other participants, but they will find only «their people».

«PRIKHODKO&PARTNERS» will help to find a way out of any of the above situation.

Specialists of «PRIKHODKO&PARTNERS» carry out complex support of the procurement procedure. PRIKHODKO & PARTNERS protects clients:

- advising on the application of the Law of Ukraine «On Public Procurement»;

- appeal against unlawful disqualifications;

- preparation of information letters to anti-corruption bodies and public organizations;

- support of criminal proceedings (interrogations, temporary access, searches, etc.);

- Protection of clients in case of abuse of rights by unscrupulous enterprises.

For example, the Law Office «PRIKHODKO&PARTNERS» opened a number of criminal proceedings under Art. 191 of the Criminal Code of Ukraine:

1. Regarding the officials of the state enterprise «Mariupol Commercial Sea Port», criminal proceedings No. 52017160000000738 of October 31, 2017, on the grounds of a criminal offense under Part 5 of Art. 191 of the Criminal Code of Ukraine. Pre-trial proceedings are carried out by the National Anti-Corruption Bureau of Ukraine.
2. Regarding the officials of the communal enterprise «Vladimir Market», criminal proceedings No. 12017100010010653 of 09.11.2017, on the fact of committing a criminal offense provided for in Part 1 of Art. 367 of the Criminal Code of Ukraine. Pre-trial proceedings are carried out by the Goloseevskiy UP UP in Kiev.
3. Concerning the officials of the Kyiv City Clinical Hospital No. 5, an application was filed for a criminal offense under Part 2 of Art. 191 of the Criminal Code of Ukraine.
4. With regard to the officials of KP «Spetszhiliefond», an application was filed for a criminal offense under Part 5 of Art. 191 of the Criminal Code of Ukraine.