A Global Game-Changer: The Rada is Recommended to Adopt the Public Procurement Bill in Full

The Committee on Economic Development recommended the Verkhovna Rada to adopt in full Bill No. 11520 "On Public Procurement".

"This is not just a technical update of Prozorro – it is a global game-changer focusing on the interests and opportunities of Ukrainian business. It is also a transition from temporary wartime adaptations to a stable legislative foundation," stated the Ministry of Economy.

What will Ukrainian business gain?

Bill No. 11520 significantly expands opportunities for Ukrainian companies, especially SMEs, to participate in procurements and removes outdated bureaucracy:

Revision of the mechanism for dividing the procurement subject into lots

The law clearly regulates the mechanism for dividing large procurements into lots. This will prevent large players from taking all orders and open doors for small regional companies to participate in large-scale tenders.

The ability to propose own solutions (alternative tender proposals)

For the first time, businesses will be able to submit their own solution options (if provided by the customer). That is, if you have a technologically better or more advantageous alternative, you will be able to offer it in the tender.

Flexible tools for long-term cooperation

Updated rules for using framework agreements and dynamic purchasing systems will allow companies to plan their work in advance, supplying standardized goods without repeatedly collecting document packages from scratch.

Regulation of subcontracting

Relations with subcontractors and co-executors are now clearly regulated at the legislative level. This makes working on large projects safe and legally protected for every participant in the chain.

Why is this important for European integration and international cooperation?

Approach to EU standards

The bill aims to implement Directive 2014/24/EU. Public procurement is part of the first, basic cluster of negotiations on Ukraine's accession to the European Union.

Donor trust and partnership development

For partners, adopting the law is an indicator that Ukraine's reconstruction is happening according to the highest global transparency standards. This will open the way for large-scale foreign investment, financing of recovery projects where Ukrainian business will play a key role.

Attracting large-scale financial support (World Bank DPO)

Adopting the law is part of a broader package of institutional reforms that Ukraine is implementing in cooperation with international partners. In particular, successful advancement of such reforms opens access to financing under the Development Policy Operation (DPO) Program for job creation and private sector growth from the World Bank amounting to 3.4 billion US dollars. The received funds are directed directly to the general state budget fund to cover priority social and humanitarian expenditures, allowing economic stability while businesses adapt to new European standards.

Previously, "Judicial and Legal Newspaper" wrote that adopting the new edition of the Law "On Public Procurement" was announced as a key stage of harmonizing Ukrainian legislation with EU law and a mandatory condition for receiving macro-financial assistance. However, on April 29, the Rada did not gain the required number of votes to adopt the law in full, sending it for a repeated second reading.

The reasons were not only discussions but also ignoring comments from the Main Legal Department, which pointed out the unconstitutionality of certain provisions, corruption risks, and contradictions with the Civil Code of Ukraine.

Bill No. 11520 was considered a basis for post-war recovery of the public procurement system, envisaging the introduction of dynamic purchasing systems, alternative tender proposals, and a life-cycle cost assessment approach. Recall that its preparation was carried out within the framework of fulfilling obligations under the EU Association Agreement and relevant provisions of the Memorandum with the European Union.

At the same time, according to experts of the Verkhovna Rada Office, the bill contains a number of legal and technical shortcomings that may create risks of extended discretion by authorities and potentially affect adherence to the rule of law principle.

The Main Legal Department identified an error in the terminology of Article 16 of the bill related to incorrect equating of the concepts "procedure" and "method" of procurement. The draft mixes the concept of "procedure" as a sequence of actions defined by European directives to select a winner, e.g., open bidding or competitive dialogue, and "method" as a way to ensure non-discrimination when concluding a contract.

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