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Uzbek Law on Public Procurement

6 June 2018

[Note: The following information was kindly provided by the Uzbek Embassy in Washington, D.C.]

On April 9th, 2018 President of the Republic of Uzbekistan Shavkat Mirziyoyev signed the Law No. 472 "On Public Procurement" developed by the National Project Management Agency under the President of the Republic of Uzbekistan together with interested ministries and departments in pursuance of the resolution of the President of the Republic of Uzbekistan dated 31 July 2017 No. PP-3166 "On the measures on the further reform of the system of state and corporate purchases of goods (works, services)".

The adopted Law will ensure openness and transparency of state purchases, competitive struggle of entrepreneurs in this sphere and will allow to effectively use the funds of the State budget, centralized sources and enterprises with a share of the state.

The law defines five types of procurement procedures, two of which completely exclude the human factor in decision-making on state procurement. In other procurement procedures, transparency is provided by publishing the necessary information on special information portal.

For the first time, taking into account international standards, this type of procurement procedure is introduced, such as purchasing from a single supplier.

Before the adoption of the Law, this sphere was regulated more than 30 normative legal acts, at the same time there was no integrity of the public procurement system, as a result of which legal conflicts arose. Multistage reconciliation and duplicate procedures created the prerequisites for corruption and entailed a significant loss of time.

The law takes into account the experience in the implementation of public procurement, as well as international practice, including the main provisions of the model legislation of the United Nations Commission on International Trade Law (UNCITRAL), the laws of the European Union, the United States, the Russian Federation, Belarus, Kazakhstan and other countries. Discussions were held with international organizations, including the World Bank, expert and business community, representatives of ministries and departments.

Main innovations of the Law:

  • Two different categories of government customers are introduced: "budgetary" and "corporate";
  • The National Agency for Project Management under the President of the Republic of Uzbekistan was designated by the authorized body in the field of public procurement. Previously, there was no authorized body in the field of public procurement;
  • A special information portal for all types of public procurement is being introduced. In the e-shop and auction, the winner is selected automatically by the electronic system;
  • All types of goods (works, services), which are not subject to specific requirements, are purchased through an electronic store. The limit for budgetary customers is up to 25 MWS, but not more than 2,500 MWS per year, for corporate customers - no more than 250 MWS. Earlier, through e-auction at the exchange, only essential goods were procured, in the list of 10-13 groups of goods, works and services, for up to 100 thousand US dollars;
  • Competitive bidding applies to all types of goods (works, services) that meet the established criteria. Earlier, the mechanism for conducting competitive bidding was only effective in the field of capital construction;
  • Sum limits for tender bidding were established: for budgetary customers - more than 6,000 MWS, for corporate customers - over 25 000 MWS. Earlier, the limit on the tenders was 100 thousand US dollars;
  • The monitoring and control of procurement procedures are regulated;
  • The Complaints Commission reviews complaints on all types of procurement. Earlier issues of public procurement control were not regulated, and disputes and disagreements were considered by a special commission only in electronic procurement.
  • The implementation of this law will contribute to the further development of a healthy competitive environment, the provision of equal access of business entities to state orders, the provision of goods (work, services) to the public sector within the optimal timeframe and will continue to create a favorable investment climate in the country and help improve the performance of Uzbekistan in international rankings.

Please click here for the Law on Public Procurement.