Problems of 223-FZ application in practice of procurements pursuing

At the moment a number of legal entities follow the federal law №223-FZ “On procurements of goods, works, services by certain legal entities” as of 18.07.2011 (as in force on 13.07.2015) in order to purchase goods, works and services for their own needs.

These entities include: state corporations, state companies, natural monopoly holders, state and municipal enterprises, companies with state share exceeding 50%, as well as enterprises operating regulated types of activity in the fields of power, gas, heat and water supply, water disposal, wastewater treatment, processing, utilization, treatment and burial of municipal solid waste. This category includes as well subsidiary companies of all the listed entities providing participation in equity exceeding in total 50%.

The analysis of state companies’ procurements by 223-FZ carried out by the Ministry of Economic Development of the Russian Federation showed the following statistics: the total sum amounted to 23,1 trillion RUB, number of placed procurements - 1,4 mln. The Top-5 largest players are (see Table 1): Rosneft, RZhD, Gazprom pererabotka Blagoveshchensk, Gazprom and Uralsevergaz. More than 50% of procurements are accounted for by these companies.  In the whole the increase of order volume amounted to 23% and the deal volume is close to 30% of GDP. According to the primary estimation of the Rosstat (Federal State Statistics Service) following the results of 2015, the GDP equals to 80,412 trillion RUB.

Several negative factors were identified in the course of the 223-FZ application analysis carried out by the Ministry of Economic Development:

• an oversize amount of electronic trading platforms (ETP) complicates accounting of deals, control over compliance with procurement requirements and doesn’t provide the sufficient level of their transparency; 
• slackening of competition in the sphere of procurements – in particular, more than 95% of procurements were carried out on the non-competitive basis, 40% - with a single supplier;
• procurements of the large customers for small and medium business (SME) are not attractive on the one hand, on the other – the SME is unable to provide the fulfillment of the large order;
• application of procedures masking the single supplier procurements, due to lack of the procurement methods list and competitive requirements to carrying out of procurements in 223-FZ;
• limited terms for applying to take part in the procurements in electronic format;
• about quarter of tenders in the total amount of executed contracts are “arranged”;
• less-than-full information in the contract register, discrepancy in procurement plans and their results – there is only information about the half of the executed contracts, the total sum is lowered;  
• termination of tenders typical for certain industries in order to eliminate the unwanted parties,; 
• the number of reasonable complaints within 223-FZ in 2015 equaled to about the half of the total amount of the filed complaints;

etc.

The identified trends lead to increase of cooperation risks and might adversely reflect on the customer and procurement parties. The business is suffering in any case. The Information and Analytical system Globas-i makes it possible to manage (reduce) these risks. Together with an aim to check the contractor’s reliability, the System gives an opportunity to study and analyze the contracts by 44(94)-FZ and procurements by 223-FZ and 44-FZ and to solve other business problems.