On additional measures to ensure transparency and increase the efficiency of public procurement (RP-5171-son)

02.07.2021

Resolution

of the President of the Republic of Uzbekistan

In order to further improve the system of public procurement of corporate and budget customers, eliminate the factors that give rise to corruption, as well as to ensure the continuous implementation of their current production activities:

1. Effective July 5, 2021, establish the procedure according to which:

a) corporate customers specified in Annex 1 to this Resolution shall:

publish on a special information portal and in the media announcements about procurement procedures and information about the results of public procurement in the implementation of public procurement;

submit in accordance with the established procedure to the State Unitary Enterprise "Center for Comprehensive Expertise of Projects and Import Contracts" under the Ministry of Economic Development and Poverty Reduction the technical specifications and tender documents for procurement for comprehensive expertise in cases where the cost of goods (works, services) exceeds twenty-five thousand times the base reference value;

consider at a meeting of the Supervisory Board annual and quarterly public procurement plans, as well as lists of goods (works, services) planned for import, for the expediency of procurement;

b) currently existing procedures for performing the public procurement directly or without tenders, determined individually in accordance with the decisions of the President of the Republic of Uzbekistan and the Cabinet of Ministers, for corporate customers specified in Annex No. 1 to this Resolution shall be canceled.

2. Establish the Republican Commission on Ensuring Open and Transparent Implementation of Public Procurement (hereinafter - the Republican Commission) in accordance with Annex 2.

Determine the Ministry of Finance (T.A. Ishmetov) as the working body of the Republican Commission.

3. The Republican Commission (A.N. Aripov) within the framework of control over the activities of corporate and budgetary customers specified in Annex 1 to this Resolution, in the field of public procurement:

shall conduct within a month an inventory of contracts worth over 1 million USD, including import contracts, and shall take measures to optimize them. Hereby, special attention shall be paid to improving – based on the results of the inventory – the efficiency of procurement under contracts, accomplished for less than 30 percent and (or) payment under which is made for less than 30 percent, as well as to reducing excessive costs;

shall hold at the end of each month critical discussions of the reports of the heads of state customers to ensure transparency and improve the efficiency of public procurement;

shall ensure the establishment of systematic control over an open and transparent implementation of public procurement, as well as over the compliance of state customers with the requirements of legislative acts.

4. Approve the Regulations on the Republican Commission to ensure open and transparent implementation of public procurement in accordance with Annex 3.

5. The Deputy Prime Minister D.A. Kuchkarov, the Ministry of Finance (T.A. Ishmetov) jointly with the corporate customers specified in Annex 1 to this Resolution shall take the following measures within two months with the involvement of international consulting and auditing companies:

conduct an audit of procurement processes, including improving the effectiveness of anti-corruption systems ("forensic");

prevent conflicts of interest in the process of contracting, examination of prices, and ensuring the quality of goods (works, services);

establish offices for the transformation of procurement at corporate customers specified in Annex 1 to this Resolution.

6. Agency for Management of State Assets (A.J. Ortikov), the Ministry of Finance (O.R. Isakov) jointly with the corporate customers specified in Annex 1 to this Resolution shall perform the following within two months:

establish electronic data exchange between the Central Bank, the Ministry of Investment and Foreign Trade, and the special information portal on public procurement;

ensure the development and adoption in accordance with the established procedure of departmental normative legal acts on the pre-qualification of suppliers;

introduce the "E-ombor" (E-Warehouse) Electronic System of Material Inventories Movement Accounting by automating the processes in the warehouse and transport logistics management system.

7. The State Tax Committee (Sh.D. Kudbiev) jointly with the state customers:

shall ensure – within three months – the integration of the "E-ombor" Electronic System of Material Inventories Movement Accounting with the information systems of the tax bodies;

shall ensure the display of identification codes of goods (works, services) in invoices in accordance with the Unified Electronic National Catalog of Products (Goods and Services), as well as the registration of all contracts on the Unified Information Portal of Electronic Contracts on a mandatory basis.

8. The Ministry of Finance (O.R. Isakov) jointly with the Ministry of Investment and Foreign Trade (Sh.A. Vafaev) shall organize – within two months – the practical training courses to improve professional excellence, knowledge, and skills in the field of public procurement of employees of state customers, responsible for organizing and conducting procurement procedures, with the involvement of foreign experts.

9. Charge the heads of state administration and economic management bodies - state customers with personal accountability for strict compliance with legislative acts in the field of public procurement, as well as ensuring openness and transparency of public procurement.

10. Repeal the Resolution of the President of the Republic of Uzbekistan dated January 22, 2018 No. PP-3487 "On measures to support the activities of business entities and enterprises of strategic importance".

11. The Ministry of Finance shall submit within three months jointly with the concerned ministries and agencies to the Cabinet of Ministers of the Republic of Uzbekistan proposals on amendments and additions to the legislation, arising from this Resolution.

12. Control over the execution of this Resolution shall be assigned to the Prime Minister of the Republic of Uzbekistan A.N. Aripov and the Head of the Administration of the President of the Republic of Uzbekistan Z.Sh. Nizomiddinov.

President of the Republic of Uzbekistan SH. MIRZIYOYEV

Tashkent,

July 2, 2021,

No. RP-5171

ANNEX 1 to the Resolution of the President of the Republic of Uzbekistan No. RP-5171 dated July 2, 2021

THE LIST

of individual corporate and budgetary customers, for which the process of implementation of public procurement shall be subject to a special control

No. Name of corporate and budgetary customers I. Corporate customers 1. JSC "Navoi MMC" 2. SE "Navoiuran" 3. JSC "Uzbekneftegaz" 4. JSC "Uzmetcombinat" 5. JSC "Uzkimyosanoat" 6. JSC "Navoiazot" 7. JSC "Fargonaazot" 8. JSC “Regional Electric Networks” 9. JSC "Uzbekiston temir yullari" 10. JSC "Khududgaztaminot" 11. JSC “Thermal Power Plants” 12. JSC "Uzbekistan Airways" 13. JSC “National Electric Networks of Uzbekistan” 14. JSC "Almalyk MMC" 15. JSC "Uzbektelecom" 16. JSC "Uztransgaz" 17. JSC "Uzavtosanoat" 18. JSC "Uzbekgidroenergo" 19. JSC "Uzbekugol" 20. JSC "Uzbekistan Airports" 21. JSC "Uzbekgeofizika" 22. JSC "Uzvtortsvetmet" 23. SUE "Davlat belgisi" 24. State Committee on Geology and Mineral Resources SE "Geoltehtaminot" II. Budgetary customers 25. Ministry of Health 26. Ministry of Water Resources 27. Ministry of Public Education 28. Minister of Housing and Communal Services 29. Ministry of Preschool Education 30. Ministry of Higher and Secondary Specialized Education 31. Committee for Roads

Notes:

1 additions and amendments may be made to this list, if necessary, by decision of the Republican Commission;

2 the Republican Commission, in the performance of its tasks, may monitor the processes of public procurement of organizations within the corporate and budgetary customers;

3 annual and quarterly plans of public procurement, as well as lists of goods (works, services) planned for importation, of corporate customers that do not have a supervisory board shall be reviewed by their founders for the expediency of procurement.

ANNEX 2 to the Resolution of the President of the Republic of Uzbekistan No. RP-5171 dated July 2, 2021

COMPOSITION

of the Republican Commission for Open and Transparent Public Procurement

A.N. Aripov — Prime Minister, Chairman of the Commission D.A. Kuchkarov — Deputy Prime Minister, Deputy Chairman of the Commission N.T. Yuldoshev — Prosecutor-General M.B. Nurmuratov — Governor of the Central Bank O.M. Umarov — Adviser to the Prime Minister B.T. Turabov — First Deputy Chairman of the Chamber of Accounts T.A. Ishmetov — Minister of Finance A.S. Sultanov — Minister of Energy Sh.D. Kudbiev — Chairman of the State Tax Committee M.B. Azimov — Chairman of the State Customs Committee A.J. Ortikov — Director of the Agency for Management of State Assets A.E. Burkhanov — Director of Anti-Corruption Agency D.F. Rakhimov — Head of the Department for Combating Economic Crimes Sh.Sh. Sharakhmetov — Chairman of the Antimonopoly Committee O.Z. Nasritdinkhodjaev — First Deputy Minister of Finance D.Sh. Sultanov — Deputy Minister of Finance B.K. Abdinazarov — Deputy Minister of Economic Development and Poverty Reduction M.A. Allabergenov — Director of SUE "Center for Comprehensive Expertise of Projects and Import Contracts" O.R. Isakov — Deputy Minister of Finance, Secretary of the Commission

Note: When the members of the Republican Commission are transferred to another work, the Republican Commission shall be composed of persons who are newly appointed to these positions, or persons who are assigned to perform the respective functions.

ANNEX 3 to the Resolution of the President of the Republic of Uzbekistan No. RP-5171 dated July 2, 2021

REGULATIONS

on the Republican Commission for Open and Transparent Public Procurement

Chapter 1. General provisions

1. These Regulations shall define the main tasks, functions, rights, responsibilities, and organizational basis for the activities of the Republican Commission to ensure open and transparent implementation of public procurement (hereinafter – the Republican Commission).

2. In its activities, the Republican Commission shall be governed by the Constitution and laws of the Republic of Uzbekistan, Resolutions of the Chambers of the Oliy Majlis of the Republic of Uzbekistan, Decrees, Resolutions and Executive Orders of the President of the Republic of Uzbekistan, other legislative acts, as well as these Regulations.

3. The Republican Commission's decisions taken within its powers shall be binding on state customers and their officials.

Chapter 2. Main tasks of the Republican Commission

4. The main tasks of the Republican Commission shall be as follows:

systematic control over open and transparent implementation of public procurement, compliance of state customers with the requirements of legislative acts;

monitoring the expediency of public procurement of goods (works, services), formation of starting prices by state customers in accordance with legislative acts;

exercising control over the attraction by corporate customers of funds of external borrowings without a state guarantee;

conducting an inventory of state customersʼ contracts worth over 1 million USD, including import contracts; taking measures to optimize them;

establishing systematic control over the attraction of external borrowings by corporate customers, financing and implementation of projects using these funds, as well as taking measures to analyze their effectiveness, efficiency, and optimization of the volume of external borrowings;

holding discussions of the reports of the heads of state customers to ensure transparency and improve the efficiency of public procurement;

Chapter 3. Rights and obligations of the Republican Commission

5. The Republican Commission shall have the right to:

request from the relevant organizations the necessary documents for the tasks assigned to it;

give instructions to the working body of the Republican Commission and other ministries and agencies on generalization and analysis of work practices in the field of public procurement;

based on the results of monitoring conducted in connection with the implementation of public procurement, take the necessary measures to improve the efficiency of procurement under contracts, accomplished for less than 30 percent and (or) payment for which is made for less than 30 percent, as well as to reduce unnecessary costs;

determine the measures of disciplinary accountability against the heads of state customers for violations in the field of public procurement.

6. The Republican Commission shall be obliged to consider comprehensively and objectively the issues submitted.

7. The Republican Commission may have other rights and obligations in accordance with the legislation.

Chapter 4. Organization of the work of the Republican Commission

8. Decisions of the Republican Commission shall be made by a simple majority of votes of its members attending the meeting of the Republican Commission. In case of a tie vote, the vote of the Chairman of the Republican Commission shall be decisive.

9. Decisions made at meetings of the Republican Commission shall be drawn up in Minutes to be signed by all members of the Republican Commission and approved by its Chairperson.

10. Control over the implementation of decisions of the Republican Commission shall be carried out by the working body of the Republican Commission.

11. The tasks of the working body of the Republican Commission shall be performed by the Ministry of Finance.

12. The main tasks of the working body of the Republican Commission shall be as follows:

a) coordination of the following, with the involvement of international consulting and auditing companies:

conducting an audit of procurement processes, including improving the effectiveness of anti-corruption systems ("forensic");

prevention of conflicts of interest in the process of drawing up contracts, examination of prices, and ensuring the quality of goods (works, services);

development and improvement of normative legal acts providing for the procedures of procurement for corporate customers;

creation of procurement transformation offices at each enterprise;

b) implementation of organizational arrangements for the meetings of the Republican Commission, including preparation and distribution of meeting materials and storage of necessary documents;

c) organization of monitoring and control over execution of decisions of the Republican Commission;

d) summarizing and submitting proposals and information from ministries and agencies to the Republican Commission;

e) obtaining the opinions of ministries and agencies on documents submitted by state customers, as well as the involvement of experts (expert organizations), consulting companies, and other specialists;

f) establishment of control and submission to the Republican Commission of information on the results of the implementation of the following tasks by corporate customers:

publication of announcements about procurement procedures, as well as information about the results of public procurement on a special information portal and in the media, in the implementation of public procurement;

submission in accordance with the established procedure to the State Unitary Enterprise "Center for Comprehensive Expertise of Projects and Import Contracts" under the Ministry of Economic Development and Poverty Reduction of technical specifications and tender documents on procurement for comprehensive expertise in cases when the cost of goods (works, services) exceeds twenty-five thousand times the base reference value;

consideration at meetings of the Supervisory Boards of annual and quarterly public procurement plans, as well as lists of goods (works, services) planned for import, for the expediency of procurement;

development and practical implementation of the procedure for pre-qualification of suppliers;

monitoring the feasibility and reasonableness of external borrowing for projects worth exceeding the equivalent of 20 million USD;

introduction of the "E-ombor" Electronic System of Material Inventories Movement Accounting by automating the processes in the warehouse and transport logistics management system.

The working body of the Republican Commission may perform other tasks in accordance with legislative acts.

13. The working body of the Republican Commission shall have the right to request the following documents and information from the state customers:

technical specifications for public procurement and procurement documents;

Minutes of meetings of the procurement commissions;

bids received from individuals and legal entities participating in procurement procedures as bidders for public procurement, as well as copies of correspondence with them;

conclusions of the State Unitary Enterprise "Center for Comprehensive Expertise of Projects and Import Contracts" under the Ministry of Economic Development and Poverty Reduction on the approved feasibility studies and financial and economic indicators of projects, as well as draft contracts;

sources of funding and documents supporting them;

conclusions of the supervisory boards;

other necessary documents and information.

14. The working body of the Republican Commission may send requests to the relevant ministries and agencies to obtain conclusions on the documents submitted by state customers.

15. At the request of the Working Body of the Republican Commission, ministries and agencies must submit – within five working days – the documents, information, and conclusions related to public procurement.

Chapter 5. Final provision

16. Persons guilty of violating the requirements of these Regulations shall be liable in accordance with the procedure established by legislation.