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Tenders and Government procurement

How often do we hear words “public purchase”, “tender”, but do not know what it really means?  Law does not offer clear definition of “tender”, although it is considered that tender is defined as bargain.

Background

Under s.447 (4) of Civil Law Act of the Russian Federation, bargain can be held in the form of the auction, competition or any other legal form. Normally, other well-known legal forms of bargain include call for quotes and call for offers. 

Now let’s define what “public purchase” is.  This term is formed because of Federal Law from 05.04.2013 N44-FL “On contractual system of purchase of goods, works, and services for state and for public needs” and Federal Law from 18.07.2011 N 223-FL “On purchase of goods, works and services by legal entities”.

Public purchases appeared because of, or more precisely, despite the corruption.  Public purchases limit the free choice of state and public contractors, which allows, in the opinion of law making authority, lowering the corruption.

The significant difference between 223-FL and 44-FL is in the fact that 223-FL does not specify the whole scope of purchase relations and can be described as a framework.  This legal form of 223-FL makes it universal due to possibility in application of sections on purchase by the charterer. On the other hand, 44-FL does not give such freedom in choosing the conditions of purchase; the process is formalized in the statute.

Moreover, 44-FL may be applied only in respect to state or public charterers (or other bodies using public or state funds); 223-FL may be applied in relation to state corporations and state companies, agricultural communities if state share is more than 50%.

Often, 94-FL is mentioned – Federal Law from 21.07.2005 N 94-FL “On placing the orders for the supply of goods , completion of works, rendering services for state and public needs” , which is inactive since 1st of January 2014 because of 44-FL coming into force. Sections in 94-FL are currently used, but are active only in respect of the purchases, which were created during the law being in force.

Such overview does not give the full picture of the public purchase activity, but gives superficial understanding of what it is. Of course, in order to learn the nuisances of public purchases and tenders one will need to spend years, as making one mistake means extra-effort and extra spending.

Authorities in the field of state that public purchases are one of the most corrupted in respect of legal relations. Based on research conducted by the Research Department of Attorney General Office in Russian federation, 86.2% of employers in attorney general office negatively assess the dynamics of criminal offences linked with corruption in the area of public purchase. In the opinion of 60,2% of participants the most well-known form of corruption in this field is mutually beneficial deal between the briber and recipient of the bribe.

According to different calculations of research agencies 10-30% of the signed deals are corrupted in this field. Therefore, even the deepest knowledge of the 223-FL and 44-FL, attractive price offers and quality of goods might be not enough to win the bargain.

For the successful work in this area, one will need knowledge of legal precedent, methods of fighting against unscrupulous charterers and experience in communication with Federal Antimonopoly Service of Russian Federation.

This task is suitable only for top class professional lawyer, working in this field. For greater efficiency work of several experienced will be useful. These are exactly features of Prime Legal LLC.

Considering special features of the related field, large volumes of information and difficulty of qualification and proving of unscrupulous charters, contacting top class specialists is the only right solution for those who are interested in winning the bargain.

Our professionals have deep knowledge of public purchase, are able to navigate 223-FL and 44-FL and are prepared to devote their excessive experience to the assistance in the public purchase.

We offer following service in the field of tenders and government procurement purchases in Russia:

  • Analysis of purchase documents
  • Appealing  unlawful  acts of charterer and organization of bargain
  • Preparation of claims for Federal Antimonopoly Service (FAS)
  • Appealing charterer’s action, organization of bargain, FAS in Court of Arbitration
  • Contract Analysis
  • Consulting on the issues in relation to application of 223-FL, 44-FL;
  • Resolution of other issues linked to public purchase and current operation activity

More information about the legal services and terms and conditions of rendering you may obtain by calling us on the phone. Call us today and tomorrow we will be applying our experience in your interests.

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