Changes in Defense Procurement: What Information Will Be Published

The President signed draft law No. 8381, which amends the Law of Ukraine “On Defense Procurement.” 

During martial law, procuring entities will have to report on direct defense procurement in Prozorro if the amount is equal to or exceeds UAH 200,000 for goods and services and UAH 1.5 mln for works. This does not apply to procurement related to weapons and state secrets.

Procuring entities will begin to publish reports a month after the official publication of the adopted law. In the future, the procurement report must be published within 10 working days from the date of conclusion of the contract. It should contain:

• the name of the procuring entity;
• the name of the procurement item with indication of the code according to the Unified Procurement Dictionary;
• the price per unit of each item of goods (indicating the unit of measurement for goods), the price of works, services.

The adopted law also obliges them to report on direct contracts concluded after February 24, 2022.

Additional rules were established for the procurement of food and services for the military. In contracts for such goods and services, procuring entities must indicate prices and units of measurement of all items of goods and describe the calculation of services with all their components. The report on the direct procurement of food services must additionally indicate information on the components of services, including the name of products, their price and unit of measurement, the cost of individual services, the total cost and terms of payment for products. Moreover, the Cabinet of Ministers will establish the procedure for determining the marginal prices for food and the grounds for changing the essential conditions of such contracts.

The Verkhovna Rada Committee on National Security was given full access to information on defense procurement — it should be provided on request within 10 working days.

Transparency International Ukraine warned about several shortcomings of the draft law No. 8381 and provided proposals for its improvement. They were partially considered.

Thus, the document leaves the risk of cancellation of full reporting on defense procurement after the end of martial law, does not introduce control over the compliance of published information with reality, does not consider the lack of indications of a number of units of measurement in relation to goods and generally has a limited range of data that must be published.

“We maintain the position that defense procurement should be as transparent as possible. And that systematic problems in this procurement should also be solved systematically. Therefore, although a step towards the publication of part of the data on defense contracts is a good thing, the newly adopted law will not be able to fundamentally change the situation,” says TI Ukraine project manager Volodymyr Datsenko.

In procurement not related to weapons, the following information may be sensitive:

• about the supplier, if their goods are unique and critical for the Armed Forces, and the characteristics of such goods;
• the exact place of delivery and sometimes the number of goods, if this can indicate the number of troops in a particular region.

These data must be kept closed. There is no need to hide all the other information. And in addition, it is necessary to improve the processes of supporting the defense sphere and improve the quality of procurement.

This publication was prepared with the financial support of the European Union. Its content is the sole responsibility of Transparency International Ukraine and does not necessarily reflect the views of the European Union.