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Prozorro is Ukraine’s electronic public procurement system, ensuring transparency, openness, and efficiency in the use of public funds.
Prozorro is Ukraine’s electronic public procurement system, ensuring transparency, openness, and efficiency in the use of public funds. All state-funded procurements, as well as certain international donor-funded projects, must be conducted through Prozorro. The system is designed to make public procurement accessible and competitive, allowing businesses to participate in tenders for goods, services, and works.
The Prozorro system operates under a well-defined legal framework that governs public procurement in Ukraine:
- Law of Ukraine "On Public Procurement" (25.12.2015 No. 922-VIII): This law serves as the cornerstone of the public procurement process in Ukraine, outlining the rules, procedures, and obligations of both procurement organizers and participants.
- Resolution of the Cabinet of Ministers of Ukraine (12.10.2022 No. 1178): This resolution provides specific guidelines for conducting public procurement during the period of martial law in Ukraine and for 90 days following the termination or cancellation of martial law. It adapts the procurement procedures to the challenging conditions during this period, ensuring continued transparency and efficiency.
These regulations ensure that procurement processes are fair, transparent, and competitive, even under extraordinary circumstances.
The Prozorro system is built on a centralized architecture that integrates multiple Authorized Electronic Platforms (AEPs). Here’s how it works:
- Central Database (CDB): This is the core of Prozorro, storing all public procurement data in Ukraine. It ensures that all information is centralized and accessible, providing transparency and allowing for public oversight.
- Authorized Electronic Platforms (AEPs): These are online platforms accredited by Prozorro to provide electronic bidding services. AEPs interact with the CDB via an Application Programming Interface (API), ensuring that all procurement data is synchronized across platforms.
- Data Flow: When a tender organizer publishes a procurement announcement on any AEP, this information is automatically transmitted to the CDB and then reflected on all other accredited platforms. Similarly, when bidders submit their proposals, the data flows back to the CDB, maintaining a single, consistent source of information.
There are currently 12 AEPs accredited in Ukraine, and businesses can choose any platform to participate in tenders. Despite the choice of platform, the information is uniformly shared across the system, ensuring equal access to procurement opportunities for all participants.
Prozorro supports various procurement procedures tailored to different types of tenders and purchase amounts. The two primary procedures are Open Bidding with Features and Simplified Procurement.
Open Bidding with Features is the most common and comprehensive procurement procedure in Prozorro. It involves several stages:
Stage 1: Procurement Announcement & Submission of Proposals
- Tender Announcement: The procurement process begins when the tender organizer publishes an announcement on an AEP. This announcement is then automatically synchronized across all platforms.
- Key Information Included:
- Description of the Procurement Procedure: Outlining the scope and nature of the procurement.
- Qualification Requirements: Detailing the necessary qualifications, experience, and technical capabilities required from participants.
- Evaluation Criteria: Explaining how bids will be assessed, typically focusing on price and compliance with the tender documentation.
- Terms of Reference: A detailed description of the goods, services, or works required.
- Draft Contract: A template of the contract to be signed with the winning bidder.
- Payment Terms and Deadlines: Including deadlines for bid submission and evaluation.
- Clarification Period: Bidders have at least 7 calendar days from the announcement to seek clarifications. During this period, they can submit questions or requests for clarification to the tender organizer, who must respond within 3 business days.
- Proposal Submission: Bidders submit their proposals, which include all necessary documentation and their financial offer. The submission deadline is clearly stated in the announcement.
Stage 2: Auction
- Auction Activation: If more than one bidder submits a proposal, the auction module is activated. Before the auction starts, the number of submitted bids is not disclosed to the participants.
- Auction Process: The auction is conducted in three rounds. During each round, participants have two minutes to lower their bid price in real time. The bidder with the lowest initial bid gets the last opportunity to reduce their price in each round.
- Auction Outcome: After the third round, the auction results are published, including the names of the participating companies and the bid prices in each round.
Stage 3: Consideration of Proposals
- Qualification Check: The tender organizer reviews the lowest bid to ensure it meets all the requirements specified in the tender documentation. This review period typically lasts 5 business days but can be extended to 20 business days if necessary.
- Compliance Evaluation: The organizer checks all submitted documents to confirm the bidder’s compliance with legal, technical, and financial requirements.
Stage 4: Selection of Winner and Contract Conclusion
- Winner Selection: Once the evaluation is complete, the organizer selects the most economically advantageous offer.
- Document Submission: The winning bidder must submit original documents within 4 days to confirm the absence of disqualifying factors as per Article 17 of Law No. 922-VIII.
- Contract Signing: The contract must be signed within 15 calendar days of the winner's selection. This period can be extended up to 60 days if justified by the tender organizer.
Simplified Procurement is a streamlined procedure used for smaller purchases, with a maximum value of UAH 200,000. This procedure is designed for efficiency, reducing the time and documentation required compared to Open Bidding.
Stages of Simplified Procurement:
- Tender Announcement: Similar to Open Bidding, but with fewer requirements and a shorter timeframe.
- Clarification Period: This period lasts at least 3 business days. Bidders can request clarifications, and the tender organizer must respond within 1 business day.
- Proposal Submission: The submission period is shorter, with a minimum of 2 business days allowed for bidders to submit their proposals.
- Auction: An auction is only held if at least two participants submit proposals. It follows the same three-round format as in Open Bidding.
- Review and Evaluation: The tender organizer reviews the most favorable bid within 5 business days.
- Contract Conclusion: If the bid meets all requirements, the tender organizer signs a contract with the winning bidder.
Non-resident companies interested in participating in Prozorro tenders must follow specific steps:
- Registration on AEP: Non-resident companies must register on one of the authorized electronic platforms (AEPs). The registration process is generally straightforward and involves filling out an online form.
- Contract Signing: After registration, the platform manager will contact the non-resident company to sign a bilingual contract (in Ukrainian and English).
- Participant Identification: The company must be identified using one of the following methods:
- Symbolic Payment: A small payment (UAH 20) from the company’s current account.
- Electronic Digital Signature (EDS): Signing the contract using an EDS, which can be submitted electronically.
- Paper Contract: Signing and submitting a paper contract to the AEP.
- Payment Process: After signing the contract, the non-resident company can replenish its account balance in EUR or USD. The payment must be made from the company’s current account.
- Currency Conversion: The received funds are converted into Ukrainian hryvnias (UAH) at the National Bank of Ukraine (NBU) exchange rate at the time of receipt.
- Processing Time: The replenishment process may take up to 5 business days for non-resident companies due to additional bank checks.
- Fee Structure: The participation fee in Prozorro tenders depends on the procurement budget and is consistent across all AEPs.
- Advance Replenishment: Ensure your balance is replenished well before the tender submission deadline to avoid delays.
- AEP Support: If funds are not credited within 5 business days, contact AEP support for assistance.
