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Bid with confidence through ProZorro, Ukraine’s public procurement system

July 1, 2019

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Purpose of this Guide

To take you closer to the undiscovered opportunities of the Ukrainian public sector through the ground-breaking procurement mechanism ProZorro.

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1. Ukraine, open for business

Roman Waschuk, Canadian Ambassador to Ukraine

“I've been Ambassador to Ukraine since 2014 and have had the privilege to see changes that have occurred these past few years.

ProZorro stands out as a world- beating change, internationally recognized for the transparency this platform brings to public procurement in Ukraine.”

Roman Waschuk, Canadian Ambassador to Ukraine

Canada-Ukraine Free Trade Agreement

An estimated 1.4 million people of Ukrainian descent live in Canada. The Canada-Ukraine Free Trade Agreement (CUFTA) provides Canadian companies with a bridge to Ukraine.

Canadian companies have equal access to public procurement projects in Ukraine. There are opportunities across diverse sectors including agriculture, energy and technology.

 

Maksym Nefyodov, The First Deputy Minister of Economic Development and Trade of Ukraine

“I believe Ukraine has a commonality and kindred spirit with Canada - historic ties that shape a certain attitude.

We are very happy to see more international participation and competition in public procurement tenders.”


“Ukraine is perfect to launch your business in Europe. Kyiv is a two-hour flight from key capitals, and one ‘truck day’ from most European cities.

The Canadian Embassy in Kyiv is particularly active and supportive, and together with the chamber of commerce and ombudsman provides a strong network of support.”

Maksym Nefyodov, The First Deputy Minister of Economic Development and Trade of Ukraine

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2. ProZorro, an open mechanism

Transparency in action

In Ukrainian language, ProZorro means transparent, and the platform is built on the principle that “everyone sees everything”.

The very nature of ProZorro, therefore, is a testament to, and literally embodies a commitment for, government spending to be accountable to the people of Ukraine and the eyes of the world.

Maksym Nefyodov, The First Deputy Minister of Economic Development and Trade of Ukraine

“Ukraine is already ahead of most countries in reforming and digitizing public procurement, and we’re proud of the international recognition that ProZorro has received.

There are many services already present to help Canadian companies do business here and thrive.

ProZorro is the product of a unique team at a unique time.”

Maksym Nefyodov, The First Deputy Minister of Economic Development and Trade of Ukraine

See public stats on ProZorro’s business information site (in Ukrainian only)

ProZorro currently adds and manages about 4000 new tenders per day.

Once a tender is complete, all data is disclosed and available, including: the list of all tender participants, their bids, the final decision, as well as all supporting documentation. These features make ProZorro a unique, world-class platform.

“everyone sees everything”

ProZorro won the prestigious World Procurement Award and the annual prize of the Open Government Awards in 2016. In addition, ProZorro has been recognised by the World Bank and is a showcase for their Open Contracting Partnership.

Easy access to opportunities

ProZorro is an open-source, hybrid system. In contrast to single or multi-platform systems, ProZorro is built upon a central database. This allows for the coordinated search of data, as well as easy access by anyone.

ProZorro data is accessible through international commercial marketplaces and trading platforms. These platforms can customize services and the presentation of ProZorro data for their clients — the companies that use these portals to submit bids.

By allowing you to place bids and access ProZorro data directly through your preferred international marketplace, it levels the playing field and reduces the possibility of monopolistic behaviour of the state.

The affiliated marketplaces compete with each other to attract and serve clients, which helps ensure cost- effectiveness and a constant improvement of service.

Versatility through partnership

ProZorro is built as a 3-way partnership between the state, business, and civil society.

This partnership encourages a quick response to challenges as they arise, and allows for continual improvement to ProZorro as feedback and best practice is gathered and made available to the public.

ProZorro is housed alongside the Government of Ukraine’s Public Procurement Department, where they work together to centralize and standardize all public procurement data.

The Public Procurement Department now focuses upon drafting legislation that improves compliance with the transparency and ideals of ProZorro.

Vasyl Zadvornyy, CEO, ProZorro

 

“Make at least three attempts before giving up.

The success rate is high; and as you become familiar with ProZorro and the documentation process, you can enjoy repeatable, long- term success as a registered supplier.”

Vasyl Zadvornyy, CEO, ProZorro

ProZorro has dedicated support channels and independent ombudsmen that were designed and built-in from the outset.

This division of responsibility and oversight is to ensure transparency and secure the user’s trust.

Since ProZorro is a totally online system, you participate in realtime through your preferred marketplace portal.

Likewise, the open data is always up to the minute, which helps you make your decisions efficiently.

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3. Challenges, an open discussion

1 in 3: The success rate of winning a bid – given the number of purchasing entities, registered vendors and volume of tenders

Commit to the Long Haul

Only about 1% of tenders through ProZorro have been won by foreign companies. The scope of opportunity, therefore, is immense.

Countries that have been most successful with ProZorro to date (China, USA) have developed support networks and local teams, in order to quickly translate, prioritise, and respond to new tenders.

Emma Touros, Head of Canada-Ukraine Chamber of Commerce (CUCC)

 

“Foreign companies now have equal access to public procurement projects.

CUFTA is a modern agreement that gives Canadian companies many advantages to explore.”

Emma Touros, Head of Canada-Ukraine Chamber of Commerce (CUCC)

Is it too open?

ProZorro takes transparency very seriously, and intentionally “errs” on that side. This is the best way to create a level playing field and combat any opportunities for favouritism or corruption.

This transparency is becoming the model for other public procurement systems around the world.

It is true that ProZorro’s degree of transparency is currently unusual, and may take some getting used to.

However, Canadian companies who have tried ProZorro (see the two Case Studies in this guide) have found it very positive in addition to the bidding, as it provides the opportunity to study relevant markets in Ukraine, as well as competitors.

Specs and standards may be unfamiliar

While tenders are increasingly presented in terms of internationally recognised standards, many tenders will yet contain unfamiliar specifications, metrics, units, and requirements.

However, these are open for discussion during the clarification period of each tender.

If your product or service is measured by a different metric or standard than specified, and you feel that you meet or surpass the specifications, then feel free to discuss that with the procurement agent.

Discuss compliance questions in advance

Some tenders will contain several terms of qualification up front, so it is useful to clarify expectations before making your bid. Local expertise is available to help!

Such considerations could be part of your strategy to quickly translate, prioritise, and respond to new tenders.

Some back and forth is required before bidding in a new sector. Therefore...

Consider local representation for long-term success.

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4. Canadian companies, an open door

There are opportunities in every sector

Roman Opimakh, CEO, AGPU

“There are at least 12 strategic areas of opportunity I would highlight to Canadian companies.

For example, Ukraine is the biggest holder of active land rigs in Europe, with about 90 active rigs; and energy production (gas and oil) is 10% of the national budget.”

Roman Opimakh, CEO, AGPU

5B USD: The annual procurement budget of Naftogaz, Ukraine’s largest public procurement entity.

Naftogaz welcomes those who are able to raise the bar in terms of quality, provision of service, ethics, and better compliance with standards.

This is a direct invitation to participation by Canadian companies.

Orest Logunov, Head of Procurement, Naftogaz

 

“We are only as good as our suppliers; and since we aspire to be the best, we desire more quality suppliers who in practice adhere to even higher standards of compliance, ethics, and service than we might currently.”

Orest Logunov, Head of Procurement, Naftogaz

Case study

Techno Canada Inc.

In 2018, Techno Canada bid on a public procurement tender to provide services within the Oil & Gas industry.

Techno Canada weighed all the considerations, risks and challenges, and found Ukrainian public tenders worthwhile to pursue, through ProZorro.

This was their first experience with ProZorro. Though they were not successful on that occasion, they definitely want to bid again.

Techno Canada did their homework and worked out necessary steps six months in advance of their first bid, which prepares them well for next time.

Initially, they had help from the partner company in Ukraine. Techno Canada receives updates about appropriate tenders as they come up, and will submit future bids. And they will seek separate local representation for themselves, going forward.

One of the challenges they encountered is that some tenders require a security bid to be in place with a Ukrainian bank, in advance. If it is not in place, you could win the bid, but not be awarded the contract.

“ProZorro was unlike any system I had ever tried before, and I really liked it. I will be using it again.

The staff at ProZorro were very friendly and helpful. The bidding process was fast. And the transparency is very illuminating.”

Roop Chakravorty, Project Coordinator, Techno Canada Inc.

Case study

Pharma Science

Pharma Science is registered with ProZorro as an approved vendor to the Ukrainian health sector.

Several of their products are approved for use by public health entities.

Because new tenders to replenish health supplies all over the country are created every month, PharmaScience has found it advantageous to maintain an office with a local representative in Ukraine.

Consider the opportunities for repeatable procurement in your sector.

Pharma Science uses one of the ProZorro-compatible trading platforms (eTender). The platform watches out for appropriate tenders, sends email notifications, and aggregates and curates relevant ProZorro data for Pharma Science.

Alexsandra Gudym-Levkovych, Deputy Director, Pharma Science, Kyiv

 

“I regularly use the data available from ProZorro to learn about the market opportunities in our industry, and to see what my competitors are doing.”

Alexsandra Gudym-Levkovych, Deputy Director, Pharma Science, Kyiv

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5. Helpful resources, an open book

Canada-Ukraine free trade agreement (CUFTA)

A unique invitation to Canadian companies

The Trade Commissioner Service

The Embassy of Canada and its Trade Commissioner Service are here to help you do business in Ukraine, as well as to help ‘brand’ Canada and showcase the expertise that Canadian companies have to offer.

Canada- Ukraine Chamber of Commerce (CUCC), an untapped resource

Emma Touros, Head of Canada-Ukraine Chamber of Commerce (CUCC)

 

“Our team in Ukraine is here to help you avoid common mistakes and to establish a local presence as needed.”

Emma Touros, Head of Canada-Ukraine Chamber of Commerce (CUCC)

Additional resources

Marketplaces

The following are some of the online platforms that have equal access and integration with ProZorro. Your bids can be placed through these platforms, which often provide services such as notification of tenders that meet your criteria.

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