Transparent construction, digitalisation and rapid restoration of energy facilities – Government adopts changes to procurement specifics

The Government has finalised the obligation for contracting authorities to publish information on prices of construction materials and resources purchased during repairs and construction in the Prozorro system. This decision ensures compliance with Law No. 3988-IX, enhances transparency in procurement, enables oversight of budget expenditure, and reduces the risk of abuse. The relevant resolution was adopted by the Cabinet of Ministers at its meeting on 1 September.

Last year, the Verkhovna Rada of Ukraine amended the Law of Ukraine “On Public Procurement” to ensure transparent use of funds during public procurement of current repair services and construction works by publishing information on prices of material resources. Dialogue with the market and contracting authorities showed the need to amend the specifics of procurement during martial law, as outlined in Government Resolution No. 1178.

Law No. 3988-IX previously mandated that contracting authorities publish documents in Prozorro with prices of material resources, including details on quantity, cost, transportation expenses, and country of origin. The adopted resolution specifies that even if a contract for procurement of current repair services (including design documentation), new construction works, construction works with design documentation, reconstruction, restoration, or major repairs is concluded without using the electronic procurement system, the contract report must still include documents with information on prices of material resources in a machine-readable format. (A machine-readable format is a structured data format that allows identification, transformation, and extraction of specific data, including individual facts and their internal structure, without human intervention).

“All information on construction procurement must now be available in a machine-readable format. This allows journalists, experts, and citizens to quickly analyse how much the state is paying and for what. It eliminates the possibility of hiding inflated prices and ensures efficient use of budget funds during wartime,” said Oleksii Sobolev, Minister of Economy, Environment and Agriculture of Ukraine.

If changes are made to procurement contracts, including those related to prices of material resources, contracting authorities will also publish the updated prices.

Additionally, due to the need to quickly restore fuel and energy complex facilities, carry out repairs, and prepare for the next heating season, the Government extended exemptions from electronic procurement procedures for purchasing gas piston, gas turbine, cogeneration units, and other equipment. However, there is a mandatory requirement to publish prices and reports for such procurements.

Natural gas market entities can now purchase compressor, gas piston, and/or gas turbine gas pumping units, including used ones, as well as services required for their evaluation, without procurement procedures. The purchase of used units must be at a price not exceeding their value, as determined by an expert opinion or property valuation report.

The Government also clarified the procedure for amending procurement contracts. It specified that the contract price may change by up to 10% with each price fluctuation in the market. This prevents contracting authorities from having to terminate contracts and hold new tenders in case of significant market price fluctuations. However, a maximum limit of 50% change in the original price of goods in the contract has been introduced, along with mandatory publication of documented justification for price changes, to prevent potential abuses.

Furthermore, the gradual digitalisation of all procurement processes continues: the resolution now explicitly provides for certain decisions by the contracting authority’s authorised persons to be issued as electronic documents, without the need for paper versions.