The Ministry of Economic Development and Trade of Ukraine has registered the state enterprise ProZorro.Sale. Thus, the pilot project ProZorro.Sale is gradually ending, and the public sales reform is now entering a new, state-owned stage. The system ProZorro.Sale will be managed by a state-owned enterprise under the MEDT.

From the first auction in October of 2016, the project ProZorro.Sale has ensured transparent sales of assets for the amount of over UAH 8 billion. The initial goal of the project was to create a transparent system of sales of assets owned by insolvent banks. Later on, its scope extended to cover other assets – property of state-owned enterprises, lease rights, advertising placement rights, municipal assets etc. At the pilot stage, the project team developed procedures and regulations, gained experience in asset sales which allows to upgrade the reform of public sales by creating a respective public institution.

“ProZorro.Sale is one of the most successful projects of the Ministry of Economic Development. As early as the pilot stage, its team already proved its extreme effectiveness when it comes to sales of difficult or problematic assets. ProZorro.Sale is necessary for Ukraine, and my stance as an official is that this project should be institutionalized as a state-owned enterprise. It will allow to formalize its form as regular instead of temporary, define its place in the system of public institutions and formulate clear rules for interaction with the public auction system that it governs,” said First Vice Prime Minister, Minister of Economic Development and Trade of Ukraine Stepan Kubiv.

The new state-owned enterprise will function under the Ministry of Economic Development and Trade of Ukraine. The main goal of the enterprise is institutionalization of the pilot project, creation of a unified public auction system, formalization of procedures and processes, technical, legal and organizational development of the system. The enterprise will be supervised by an independent oversight council consisting of representatives of the MEDT as well as three independent experts selected through an open competition. Representatives of the Deposit Guarantee Fund will be invited to the Oversight Council as well.

“The state-owned enterprise will function according to the highest standards of corporate governance. The Oversight Council will approve key decisions, such as appointment of the director or the financial plan, thus ensuring their independence,” commented First Deputy Minister of Economic Development and Trade Maksym Nefiodov.

Yaroslav Yurchyshyn, Executive Director of Transparency International Ukraine, added that the pilot project ProZorro.Sale is another proof of effectiveness of the “golden triangle of partnership” for implementation of reforms. “Interaction of business, the government and social activists produces great results, we saw this back when we were working on the ProZorro system and recreated during the pilot stage of ProZorro.Sale. Transparency International Ukraine acted as the guarantor of the project’s integrity and administration of the central database at the pilot stage. Over this time, we developed basic procedures and gained a lot of experience with public sales. Now is the time to take it one step further and institutionalize this achievement by creating a state-owned enterprise. Now, we are starting the transfer process, which will last for several months. If the work is as diligent as during the pilot stage, the state enterprise is going to be very successful,” he said.

Project manager of ProZorro.Sale Oleksii Sobolev was appointed the acting director of the state-owned enterprise. He says that the key focus areas are sales of assets of insolvent banks, national and municipal enterprises, small-scale privatization.

“As you know, the Law on privatization has been passed, therefore, the sales will only be executed through ProZorro.Sale from now on. Currently, technical preparation is underway, with the first auction planned for June. Overall, National Property Fund has announced a list of 600 enterprises which will be sold through transparent auctions this year,” he explained.

Among other plans for 2018 is a pilot project on Ukrzaliznytsia car lease, launch of a joint project with Geocadastre etc. “We started with sales of property of insolvent banks, but now the list of assets which are sold through the auctions has been significantly extended. Therefore, the state-owned enterprise specializes in transparent auctions for sale of any assets. We will cover all areas of public sales reform and remain its principal driver,” emphasized Sobolev.

The project’s IT migration will take place during May-June. The recruitment process for the enterprise is underway. It is expected that the project team of ProZorro.Sale will form the core staff of the enterprise. However, more professionals are needed, so the search of qualified candidates has already started. “I urge everyone who strives to contribute to the grand reform of public sales and build the best auction system in the world, join our team! We have a lot of interesting work to do,” added Sobolev.

At the pilot stage, ProZorro.Sale was financed by donor organizations. The state-owned enterprise will be financed through the fee paid by electronic platforms licensed to work with ProZorro.Sale.

Find out more in the presentation

ProZorro.Sale is an electronic trade system used for sales of assets of insolvent banks, managed by Deposit Guarantee Fund and property of national and municipal enterprises.

Пілотний проект ProZorro.Продажі не використовує бюджетних коштів. Партнерами проекту виступають Western NIS Enterprise Fund (WNISEF) – перший в Україні та Молдові регіональний фонду прямих інвестицій з капіталом $150 млн, заснований за фінансування уряду США через Агентство США з міжнародного розвитку (USAID), та громадська організація Transparency International Україна – українське відділення всесвітньо відомої антикорупційної організації Transparency International, заснованої 1993 року в Берліні колишнім директором Світового банку Пітером Айґеном. Крім того, проект ProZorro.Продажі розвивається за підтримки GiZ, Посольства Нідерландів, та добровільних пожертв українського бізнесу.

The pilot project ProZorro.Sale does not use budget funds. Project partners are Western NIS Enterprise Fund (WNISEF) – the first regional fund of direct investments in Ukraine and Moldova with the capital of USD 150 million founded with the support of US Government through USAID and civil society organization Transparency International Ukraine – the Ukrainian chapter of the internationally renowned anti-corruption network Transparency International, founded in 1993 in Berlin by former World Bank executive Peter Eigen. In addition to that, ProZorro.Sale develops with the support of GiZ, Embassy of the Netherlands and charitable donations of Ukrainian business.