In the media, news periodically appears that something very insignificant for a meager amount was purchased at an auction in Prozorro. We explain why this is a mistake, and what is the difference between a tender and a report.

Starting from April 2020, all procuring entities are required to report to the electronic public procurement system on all their expenses beginning from 1 kopiika. In 2020-2021, according to the BI Prozorro public analytics module, there were more than 32,000 procurement transactions worth less than UAH 20 and more than 250,000 — up to UAH 100. That is, Prozorro has a lot of procurement pages with the name “brush,” “flour,” “salt,” “notebook,” “nails,” “sausages,” and the like with a cost of several tens, or just several hryvnias. Does this mean that they were bought at an auction?

What is a procedure

Procurement transactions, depending on the cost and the procurement item, are carried out in different ways. Goods and services worth more than UAH 200,000 and works worth more than UAH 1.5 billion should only be purchased through open bidding. These are classic auctions or, as they are also called, the bidding.

Procurement transactions from UAH 50,000 to thresholds (i.e., UAH 200,000 for goods and services and UAH 1.5 mln for works) are carried out as simplified ones. An auction in Prozorro is also announced, but it lasts less time, one needs fewer documents to participate in it, and if only one participant comes, a contract can be simply signed with them. In the classic bidding, the procurement would have to be canceled and announced again because there must be at least two offers for competition.

Everything that costs less than UAH 50,000 can be purchased without Prozorro.  However, from April 2020, you need to report about each such procurement in the system. That is, the procuring entity can buy a pack of flour for UAH 24 in the store, but they must enter information about this in Prozorro. That is why journalists sometimes come across pages in the system for purchasing sausages for UAH 32, and then they make news out of it. In fact, these are not auctions, just procurement reports. 

Procuring entities — starting from a rural school to the Presidential Office — use budget funds, that is, our taxes. A couple of years ago, they came up with a cool thing — to oblige them to report all their expenses so that we could track them. And it was added to the new version of the Law “On Public Procurement.” Previously, one had to enter information about procurement transactions in the system starting from UAH 50,000. 

In addition to open bidding, simplified bidding, and reports on the concluded contract, there are other procedures: negotiation, competitive dialogue, procurement from Prozorro Market, and a framework agreement. There is also a separate procedure for procurement transactions starting from EUR 133,000 — European bidding.

Where to find whether it is a tender or not a tender

The purchase page on Prozorro looks like this:

the first line is the title;

the second one is the code in the system,

and the third one is the procedure.

“Procurement without using an electronic system” means that the procuring entity bought the item outside Prozorro, without using auctions. If they applied open bidding, this line would say “open bidding” or at least “simplified procurement.”