The State Agency of Automobile Roads of Ukraine (Ukravtodor) published a statement on October 3. It was their reaction to COST Ukraine’s remark concerning Ukdavtodor’s discriminatory procurement requirements. In particular, COST emphasized the requirement to contractors to have obligatory experience of work “in Ukraine or EU countries.” This requirement can leave out potential participants of the procurement procedure with experience of high-quality work beyond the designated narrow area. Besides, this requirement completely contradicts the Law of Ukraine “On Public Procurement,” EU-Ukraine Association Agreement and WTO Agreement on Government Procurement.
The State Agency, instead of taking the remark into account and removing the discriminatory requirements, chose the tactic of public accusation of COST Ukraine of lobbying specific contractors. Which Transparency International Ukraine believes to be absurd. After all, removing discriminatory requirements means exactly elimination of artificial conditions for lobby of the companies that would potentially benefit from these conditions. Besides, in its own statement, Ukravtodor provides generalized conclusions about cooperation with some companies (we wonder about the countries of registration of these companies, perhaps, Ukravtodor will publish this statistics?). Now to the quotes: “two thirds of the repair works have been done with defects, many contractors are just bogus firms without verified work experience, some contractors win tenders for projects that they are not capable of doing due to lack of experience and working assets.” In view of this, we would like to ask if these conclusions by Ukravtodor are not a significant reason to broaden the circle of potential participants as much as possible instead of narrowing it down further? What could be wrong with adding companies that have verified experience of high-quality road construction and repair but not in Ukraine or the EU?
Besides, in its recommendations, Ukravtodor recommends to define the bid security amount, in case of works worth over 100 mln UAH, at the level of 3% of the expected cost. This requirement also contradicts Article 24 of the Law of Ukraine “On Public Procurement,” since “the amount of bid security in monetary form cannot exceed 0.5% of the expected costs in case of bidding for procurement of works.”
Such recommendations can indicate lack of competence of Ukravtodor representatives who developed them or deliberate effort to restrict competition through excessive requirements.
The mention of Transparency International as a source of financing of COST Ukraine is not clear to us either. If the organization in question is the international network TI, it does not finance this initiative. If they meant TI Ukraine, the Ukrainian chapter of the global network really acts as the receiving organization of the COST Initiative and administers its financing. All reports on this are publicly available.
Transparency International Ukraine, as an organization that actively endorsed and endorses public procurement reform, calls on Ukravtodor to return to observation of principles of public procurement as required by the law. We hope that, instead of public accusations, Ukravtodor will withdraw part of its requirements and bring the tender documents of certain instances of procurement by the State Agency of Automobile Roads in compliance with the law and international agreements that Ukraine has signed.