Discrimination in Coal Procurement on Prozorro Market: How Widespread Is It?

Since participants have no avenue for challenging procurement on Prozorro Market, they seek any other means of protecting their rights. Including by approaching civil society organizations. Over the past year, our DOZORRO TI Ukraine project received numerous complaints regarding potential discrimination in requests for proposals (RFPs), a significant share of which concerned the procurement of hard coal. In their draft contracts, contracting authorities imposed excessive quality requirements and demanded additional documents not provided by law. 

We decided to examine how widespread this practice is. We focused specifically on hard coal procurement because:

• We received many complaints from participants about this category
• This commodity has clear national quality standards, making it easier to establish whether requirements are excessive
• Coal procurement through Prozorro Market is not mandatory — contracting authorities have an alternative — so unlawful requirements cannot be justified by the constraints of the electronic catalog; and RFPs can here be compared against open tendering.

This approach allowed us to concentrate on a qualitative analysis of the terms and requirements imposed on suppliers without sacrificing the representativeness of the study. The problems identified during this research are potentially not unique to this commodity group and may point to broader systemic challenges in the use of RFPs that warrant further attention and analysis.

SUMMARY

More than half (55%) of the hard coal procurements checked contained unlawful requirements to provide additional documents and set extremely short deadlines for their submission — conditions that are potentially discriminatory. 

Draft contracts frequently also included provisions under which failure to submit documents within the short deadline was automatically treated as a written refusal to conclude a contract, resulting in the rejection of the tender and disqualification of the participant.

In the representative sample, winning tenders in procurements with unlawful requirements and disqualifications were on average nearly 40% more expensive than the lowest-priced tenders that contracting authorities had rejected.

This practice demonstrates that the simplified RFP procedure sometimes fails to function as intended and partially undermines the logic of the electronic catalog as a fast and accessible procurement tool. To enhance transparency in Prozorro Market procurement, the DOZORRO TI Ukraine project recommends the following:

1. Closing the hard coal category in Prozorro Market.
2. Introducing a mechanism for challenging procurement requirements, which would give businesses a means of protecting their interests and could significantly reduce the risk of abuse. 
3. Enabling monitoring of RFPs by the State Audit Service, to bring this procurement under oversight.
4. Granting the Ministry of Economy the authority to approve standard contracts for specific commodity categories, thereby simplifying their preparation and ensuring legislative compliance, and converting them into electronic contracts.
5. As electronic contracting develops, introducing automated pre-screening of draft contracts in the electronic catalog that, upon detecting potentially unlawful language, would generate alerts for supervisory authorities.
6. Developing guidance notes for authorized persons at contracting authorities, with recommendations on preparing and conducting procurement through the e-catalog.

Together, these measures can make Prozorro Market procurement more transparent, predictable, and user-friendly for both contracting authorities and market participants.

What makes Prozorro Market procurement distinctive

The specifics of procurement through the e-catalog (Prozorro Market) are governed by a separate Procedure for the Formation and Use of the Electronic Catalog (the Procedure), approved by Cabinet of Ministers Resolution No. 822 of September 14, 2020. The core idea behind this method is to simplify and expedite procurement. Qualification — that is, the verification of supplier documents — is handled by the catalog administrator. RFPs are not subject to auditor monitoring, and participants have no right to challenge either the terms or the decisions of contracting authorities. 

An RFP is generated by completing electronic forms in which the contracting authority specifies a limited set of details: the name of the procurement item, estimated value, quantity, delivery period and location, payment terms, and the deadline for submitting price proposals. 

When publishing an RFP, a contracting authority may only specify information on the specifications of the goods and their permissible values within the item specification set by the catalog administrator. The government recently amended the Procedure (Cabinet of Ministers Resolution No. 33 of 14 January 2026), further specifying the list of details that may be indicated. It was clarified that, in addition to the information already mentioned, a contracting authority may specify the delivery terms, the amount, type, period, and conditions for providing and returning contract performance security (where it requires such security to be provided), as well as a requirement that the country of origin may not be the Russian Federation, the Republic of Belarus, or the Islamic Republic of Iran.

The draft contract, which forms part of the RFP, must not conflict with the information the contracting authority has entered in the electronic fields, and may contain other conditions that are provided for by law in respect of such a contract and that the contracting authority considers necessary for the performance of the contract during its term. It is prohibited to include in an RFP requirements directed at the procurement participant or the selected winner, or to demand any additional documents not provided for by the Procedure. This is a prerequisite for the transparency of such procurement and allows potential suppliers to properly assess its terms and make an informed decision on whether to participate.

Hard coal procurement through RFPs

This study focuses on CPV class “Solid fuels” (code 09110000-3), with an additional targeted sample specifically of hard coal procurements conducted through RFPs on Prozorro Market. For the analysis, we selected procurements announced between September 1, 2024, and September 30, 2025. 

The total number of lots included in the analysis is 858.

For coal procurement, contracting authorities opt for the RFP method twice as often as for open tendering — Prozorro Market accounts for about 64% of such lots. The estimated value of RFP-based procurements is also twice as high, representing 62% of the value of competitive coal orders. Significantly more participants come forward for Prozorro Market procurements — an average of 6.58, compared with 2.04 in open tendering. However, the number of disqualifications is also much higher. 

Where contracting authorities reject 16.5% of tenders in open tendering, the corresponding figure in RFPs is approximately 55%. It is important to note in this context that in open tendering, approximately 22% of lots are accompanied by complaints, which underscores the significance of the review mechanism as an instrument for overseeing the transparency and openness of procurement.

All profiles in the coal category on Prozorro Market now require goods to comply with the DSTU 7146:2010 standard (the Standard). Under the Standard: 

• When concluding a coal supply contract for household needs, a certificate of genetic, technological, and quality characteristics must be presented (clause 7.10). In practice, however, the application of this provision of the Standard creates a conflict in law enforcement, since the Procedure expressly prohibits the demand for any additional documents under the RFP. 
• A coal consignment is considered accepted for dispatch once a composite commercial sample has been taken from it in accordance with DSTU 4096 and a quality certificate has been issued (clause 7.3). Accordingly, this certificate may be requested at the time of delivery.

The requirement to provide these additional documents occasionally appears in lot notes — in 6% of procurements. These are optional fields in which contracting authorities may include supplementary information about the procurement — for example, drawing potential suppliers’ attention to terms of particular importance to them. However, in addition to established documents, contracting authorities in 1.4% of lots also required additional documents not covered by the Standard. Notes carry no legal force, but this already reveals at this stage that some contracting authorities conducting coal procurement tend to impose excessive requirements on potential bidders that are not provided for by law.

Additional requirements in draft contracts 

For the detailed analysis, we randomly selected 270 lots from the full dataset of 858. The sample was calculated using a 95% confidence interval and a 5% margin of error. The sample is therefore representative and reflects the overall picture of coal procurement through Prozorro Market.

Under the legislation in force at the time of the procurements under review, an RFP must not contain requirements directed at the supplier or any documents not provided for by the Procedure. In the draft contract, as elsewhere, a contracting authority may specify only information on the characteristics of the goods and their permissible values within the item specification set by the administrator.

The Standard does not require any documents to be provided in respect of coal other than the certificate of genetic, technological, and quality characteristics at contract signing, and the quality certificate for the coal consignment at delivery. Accordingly, only the certificate of genetic, technological, and quality characteristics and contract performance security in the form of a bank guarantee may lawfully be required at the contract conclusion stage (Article 27(1) of the Law on Public Procurement). The right to require a bank guarantee is now also expressly provided for in the amended Procedure — the contracting authority may specify in the draft contract the amount, type, period, and conditions for providing and returning such security. Any other documents demanded from participants or the selected winner that are not provided for by law are unlawful.

The findings, however, point to systematic non-compliance with these requirements. The documents most frequently demanded by contracting authorities in draft coal supply contracts were as follows.

Overall, 55% of draft contracts (148) in the sample contained requirements to provide additional documents not provided for by either the Procedure or the Standard. In isolated cases, these were manifestly excessive and included documents with no functional connection to the subject matter of the procurement — for example, a certificate of proficiency in the state language, copies of the coal producer’s financial statements for prior years, or an expert market assessment. In the majority of procurements, however, the violations consisted in requirements to provide documents that formally relate to the supplier’s operations but do not affect the physical or quality characteristics of the goods and are not provided for by law, in particular, quality management system certificates, proof of experience in performing similar contracts, or extraction permits. This points to a systemic and uncontrolled expansion of supplier requirements. A full list of documents whose provision was recorded in the study is available via the table at the link.

In practice, contracting authorities are using the draft contract as a tool for introducing additional barriers to participation — contrary to the simplified nature of the RFP procedure and creating disproportionate and discriminatory conditions for suppliers. This eliminates competition, impedes access for bona fide participants, and undermines the logic of the e-catalog as a fast and transparent procurement tool.

When additional documents must be submitted

The review of draft contract terms also revealed that in 52% (141) of procurements, contracting authorities set extremely short deadlines — between 1 and 48 hours — for submitting an additional, sometimes excessive, list of documents required for contract conclusion.

Such tight timeframes place suppliers on an unequal footing, functioning as a barrier and a covert mechanism for selecting a predetermined winner while screening out those objectively unable to meet the requirements in time.

In this context, it is important to determine from what moment the clock actually starts running. The analysis shows that contracting authorities use one of two reference points: 

• the opening of proposals, which virtually coincides with the submission deadline;
• the determination of the selected winner (receipt of an automated system notification).

When publishing an RFP, a contracting authority may set the proposal submission deadline at its own discretion, subject to the minimum requirements of clause 57 of the Procedure — the deadline may not be less than two working days from the date of publication. Formally, this requirement may be satisfied even where the deadline falls on late evening, midnight, or a weekend. 

Particular concern is raised by the combination of nighttime proposal openings and extremely short deadlines. In 25% of lots with short deadlines, suppliers are given between 1 and 4 hours to provide additional documents after the opening of proposals or the determination of the winner. In half of those cases, the proposal submission deadline and automatic opening fall between 11:00 p.m. and 01:00 a.m. compelling suppliers to submit documents during nighttime hours when most responsible personnel are unavailable. 

As regards the moment of determining the selected winner, under clauses 61–62 of the Procedure the winner is determined automatically upon expiry of the submission deadline and evaluation by the electronic system. In practice, however, this long remained in a gray area, with two competing interpretations: immediately upon opening of proposals, or upon the contracting authority’s confirmation. This has now been resolved. Under the amended clause 62, the contracting authority determines the winner and records its intention to conclude a contract in a protocol that is automatically generated and published in the system. Notification of intent is sent automatically within one day of publication. The start of the compliance period is therefore now more transparent and clear to all suppliers.

Even so, where contracting authorities indicated that the winner would be determined “upon receipt of a system notification,” the combination of short deadlines and uncertainty about when that notification would arrive created additional pressure. Winners were compelled to await confirmation without being able to predict the precise start of the compliance period, making timely preparation of documents more difficult. In any case, requirements to provide excessive or unlawfully demanded documents remained unlawful regardless of how that moment was defined. 

Imposing additional requirements through the draft contract not only constitutes a procedural violation but also contradicts the fundamental principles of contract law and public procurement. Contract terms apply only to the parties that have actually concluded the contract. 

Equally legally incorrect is the widespread practice of including provisions such as: “In the event that the Contracting Authority is not provided with such documents (as defined in the draft contract), the Contracting Authority shall treat this as a written refusal by the participant to sign the contract, and shall accordingly reject such participant’s proposal pursuant to subclause 2 of clause 64 of Cabinet of Ministers Resolution No. 822 of September 14, 2020.”

Subclause 3 of clause 64 of the Procedure provides as a ground for rejection only the selected winner’s written refusal to sign the contract. Under Article 207 of the Civil Code, a legal transaction is considered to have been effected in writing if its content is recorded in document(s) exchanged by the parties, including through information and communication systems. A refusal to conclude a contract has legal force only if made in writing by a person with authority to sign it — the selected winner, not merely a procurement participant — and communicated to the other party. The failure of a participant or winner to take certain actions or submit documents, even if such actions are provided for in the draft contract, cannot therefore be treated as a written refusal to sign.

Such conditions create fertile ground for abuse. Formal procedural compliance combined with additional barriers at the contract conclusion stage creates the appearance of competitive tendering while in practice restricting participation to a narrow pool of suppliers who, in certain cases, may be connected, resulting in procurement at inflated prices and inefficient use of public funds.

For example, in February 2025, a gymnasium in Kirovohrad Region procured three types of coal. The draft contract required participants to submit over a dozen documents — including an underground mining permit and financial statements — within 24 hours of the opening of proposals. The contracting authority rejected 8 out of 9 proposals and concluded a contract at the highest price of UAH 299,700, while the lowest offer was UAH 182,000. In another case, the Vanchykivtsi Village Council’s coal procurement required a set of documents within 24 hours of the winner being determined. According to suppliers, proposals were rejected even where the documents were submitted. The contracting authority rejected 8 out of 9 proposals and concluded a contract for nearly UAH 2.6 million, against a lowest tender of UAH 1.5 million. 

Overall, in the analyzed sample, the gap between the lowest and winning tenders in procurements with unlawful requirements or short deadlines amounted to UAH 28.5 million — contracts ended up costing nearly 40% more than they could have.

Such violations have already drawn the attention of law enforcement and courts. A number of criminal proceedings have been opened for misappropriation of public funds in RFP procedures (case numbers 42024222140000071, 12025082210000241, 12025160000000217). A court judgment has also been handed down (No. 573/1300/25) finding that the contracting authority’s actions — in particular, setting a 1-hour deadline for an excessive list of documents — resulted in the rejection of the majority of economically advantageous proposals, contract conclusion at an inflated price, and inefficient use of public funds.

As part of the study, we spoke with suppliers about their direct experience practice of applying additional requirements and barriers at different stages of procurement. Some noted that in most procurements with additional requirements, contracting authorities either tailor conditions to a specific supplier or mechanically copy draft contracts from other RFPs. They also noted that contracting authorities sometimes justify excessive requirements by the desire to minimize their own risk in connection with potential post-delivery inspections. One supplier reported instances of pressure from competitors filing complaints with law enforcement, after which contracting authorities are required to justify the price-to-quality ratio of the coal delivered. 

We also approached individual contracting authorities for their perspective. Most said the primary purpose of such measures is to “play it safe” against the risk of receiving low-quality coal mid-heating-season or dealing with unreliable suppliers or fraudsters. They noted that even where contractual penalties exist, they often lack the resources for lengthy court proceedings. Regrettably, some contracting authorities, when their attention was drawn to potential violations, responded dismissively or claimed not to recall the details. It is also worth noting that some contracting authorities interpret certain legislative provisions at their own discretion — for example, taking the view that requiring documents and contract signature within 24 hours does not conflict with the statutory five-calendar-day deadline for concluding a contract.

Conclusions

55% of RFPs for coal procurement contain requirements to provide documents not provided for by law, and 52% set short submission deadlines.In the representative sample, winning tenders in procurements with unlawful requirements and disqualifications were on average nearly 40% more expensive than the rejected lowest-priced tenders.

These statistics relate exclusively to coal category procurements, not to all RFPs on Prozorro Market. The situation may vary by commodity, and there may be categories where this problem is not systemic. The study does, however, identify specific vulnerabilities in the RFP process and illustrates the potential scale of problems in certain categories.

• The most effective remedy would be a review mechanism in Prozorro Market, currently being developed under the draft new Law on Public Procurement. However, that process is lengthy and the new mechanism will not cover all RFP-based procurements. 
• The situation of unlawful rejections on grounds of alleged refusal to sign would improve with e-contracting, which is also yet to come. But these need not be the only solutions. 

It is therefore worth introducing a range of additional instruments to reduce abuse risks, enhance legal certainty, and strengthen contracting authority capacity.

• Enable monitoring of RFPs by the State Audit Service.

The State Audit Service does not currently monitor RFPs. Whether it has the legal authority to do so is disputed due to ambiguous wording in the procurement rules. It would therefore be advisable either to confirm formally that monitoring is permitted or to amend the legislation accordingly. Even selective monitoring and sanctioning of individual violators can deter future violations.

• Develop and introduce standard contracts.

The e-catalog currently has no mandatory contract templates for commodity categories, and the Ministry of Economy lacks the authority to approve them. The Ministry should be granted that authority and standard contracts approved that set out the permissible terms for coal procurement, leaving contracting authorities to fill in only the key parameters — delivery and payment terms and quantity. This would unify procurement terms, ensure legislative compliance, and simplify preparation without restricting contracting authorities from reflecting their specific needs. These should subsequently be introduced as e-contracts.

• Close the hard coal category in Prozorro Market.

Given that over 50% of procurements in this category contained unlawful requirements, coal procurement through RFPs should be restricted. Procurement would then take place through a method under which businesses may challenge discriminatory requirements and auditors may carry out monitoring. 

• Develop and introduce universal guidance notes for procurement through the electronic catalog.

Such notes will help authorized persons conduct RFPs correctly, apply legislative provisions accurately, and avoid excessive or discriminatory conditions — contributing to more transparent, predictable, and high-quality catalog procurement.

• As electronic contracting develops, introduce automated pre-screening of draft contracts in the e-catalog as a risk indicator for supervisory authorities.
  The algorithm could detect keywords and language conflicting with legislation and the Procedure — such as “certificate,” “declaration,” “permit,” “within X hours of the opening of tenders.” Where such indicators are found, the system could generate risk signals or reports for supervisory authorities. This will become technically feasible only once electronic contracting is in place, as the system currently cannot automatically read and analyze file contents.

These recommendations will help eliminate one method of circumventing the rules in coal procurement and more broadly improve the efficiency and transparency of RFP-based procurement. Efforts must also continue to find approaches that allow contracting authorities to minimize the risk of receiving substandard goods, while protecting bona fide participants from artificially created obstacles and bad-faith practices.

This research was made possible with the support of the MATRA program of the Embassy of the Kingdom of the Netherlands in Ukraine. Responsibility for the content lies with the author and does not necessarily reflect the official position of the Embassy.

This research was developed by

Team lead: 

Ivan Lakhtionov, Deputy Executive Director of TI Ukraine for Innovative Projects

Authors of the research:

Viktoriia Hermasheva, Projects Assistant, TI Ukraine

Kateryna Rusina, Project Manager at DOZORRO