IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

firm-specific

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 01 Sep 2016 | Removal date: open ended
Still in force

Public procurement access

Concretely, Federal Law No. 365-FZ of 3 July 2016, officially published on 13 July 2016, introduces for the first time the possibility for state bodies as contractors to purchase at regulated prices from a single supplier goods on condition that they are manufactured or "modernised" in Russia in two new cases. 

Firstly, when the single supplier operates under the rules of a Special Investment Contract (SIC), introduced by Federal Law No. 488-FZ “On Industrial Policy” (article 93, new paragraph 47). Secondly, municipalities and the top administrative units of the Russian Federation are entitled to sign a procurement contract at regulated prices with investors (defined only as juridical persons) as single suppliers (article 93, new paragraph 48) if they contribute to the creation and modernisation of certain goods, produced on their territory (article 111.4).

The notion "regulated prices" is defined in Order No. 567 of 2 October 2013 of the Ministry of Economic Development. It contains a methodological recommendation for its calculation. Concretely, it is recommended to use the so-called "tariff method" (article 5.1 of Order No. 567) for price-setting of the supplies of goods, services and works under state and municipal procurement orders which are subject to regulation. Order No. 567 stipulates that the calculated under this method procurement order price must not surpass the maximum price for the public procurement of the respective goods, works and services. These prices are defined in accordance with decrees, resolutions, orders and other legal acts of the respective authorised state bodies. Hence, Order No. 567 ensures a certain upper price band not to be surpassed. Furthermore, it defines the cases when it is redundant (not recommended) to apply the tariff method, notably for prices "not lower than which in compliance with the legislation of the Russian Federation are realised the purchases, supplies and sales of such goods, works and services". 

Technically, Federal Law No. 365-FZ introduces the above-described state interventions by amending Federal Law No. 44 FZ of 5 April 2013. The validity of Federal Law No. 365-FZ is not limited to specific sectors or tariff lines. Federal Law No. 365-FZ entered into force on 1 September 2016.

Legal background concerning SIC:

According to Law No. 488-FZ, SIC is given to investing companies that undertake to modernise existing industrial production or to create a new one. SICs is to be guaranteed long-term incentives in Russia. The maximum duration of such a contract is up to ten years. The contractual parties are the Russian government, respectively its constitutional regions, and municipalities, and the investors. A principal characteristic of this public-private partnership is the non-participation of any budgetary funds. The Russian Government guarantees by means of SIC stable business conditions in terms of applicable legal regimes concerning SIC.

 

AFFECTED COUNTRIES

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