On challenging actions (inaction) and decisions of the competition commissions to exclude them from participation in the competition based on applications from potential suppliers in the field of public procurement

Jurisdiction.

Paragraph 1 of Article 47 of the Law provides for the right of a potential supplier to appeal to the authorized body the actions (inaction), decisions of the customer, the organizer of public procurement, the single organizer of public procurement, commissions, experts, a single operator in the field of public procurement, if their actions (inaction), decisions violate the rights and legitimate interests of the potential supplier.

However, by virtue of paragraphs 2 and 3 of the said article, such an appeal is possible no later than five working days from the date of posting the protocol on the results of public procurement by means of a tender (auction). Upon expiration of the specified period, appeals against actions (inaction), decisions of the customer, the organizer of public procurement, the single organizer of public procurement, commissions, experts, and the single operator in the field of public procurement are carried out in accordance with the laws of the Republic of Kazakhstan.

The provisions of the Law do not contain instructions on the mandatory procedure for appealing actions (inaction), decisions of the subject of the public procurement system that violate the rights and legitimate interests of a potential supplier. Such a potential supplier has the right to file a complaint directly with the court.

In accordance with subparagraph 2) Paragraph 12 of the regulatory decree of the Supreme Court "On the application of legislation on public procurement by courts" is subject to judicial challenge, both the results of public procurement and the decision on admission to participate in public procurement conducted through a tender or auction. Such cases are subject to consideration by the courts in the order of special claim proceedings.

The application is submitted at the location of the body or official whose actions are being appealed.

According to the first part of Article 27 of the CPC, cases on public procurement disputes in which the parties are individuals engaged in individual business activities without forming a legal entity are considered by specialized inter-district economic courts.

In accordance with paragraph 6 of Article 47 of the Law, a decision of an authorized body may be appealed in court based on the results of consideration of a potential supplier's complaint about actions (inaction), decisions of the customer, the organizer of public procurement, the unified organizer of public procurement, commissions, experts, a single operator in the field of public procurement, if their actions (inaction) solutions violate the rights and legitimate interests of a potential supplier.

If a potential supplier appeals against actions (inaction), decisions of subjects of the public procurement system, after concluding a public procurement contract with another potential supplier, such cases are subject to consideration in a lawsuit involving the supplier with whom the contract was concluded as a defendant.

At the same time, demands are made to invalidate a public procurement contract concluded with another supplier, as well as between two potential suppliers (one of whom has acquired supplier status), since a dispute arises over the right to conclude a public procurement contract with the customer.

Persons involved in the case.

The applicant (plaintiff) is a potential supplier whose rights and interests have been violated. According to subparagraph 2) of article 2 of the Law, a potential supplier may be a person applying for a public procurement contract.:

- an individual engaged in entrepreneurial activity;

- a legal entity (with the exception of government agencies, unless otherwise provided for by law;

- temporary association of legal entities (consortium);

- an individual who is not a business entity, in the case of the customer's purchase of a dwelling owned by such an individual.

The person whose actions are being appealed (the defendant) is the following subjects of the public procurement system, whose actions (inaction) or their decision violate the rights and legitimate interests of a potential supplier:

- customer – state bodies, state institutions, as well as state-owned enterprises, legal entities, fifty or more percent of the voting shares (participation shares in the authorized capital) of which belong to the state, and legal entities affiliated with them, with the exception of national management holdings, national holdings, national management companies, national companies and legal entities affiliated with them, The National Bank of the Republic of Kazakhstan, its departments, organizations within the structure of the National Bank of the Republic of Kazakhstan, and legal entities, fifty or more percent of the voting shares (stakes in the authorized capital) of which belong to the National Bank of the Republic of Kazakhstan or are in its trust management, and legal entities affiliated with them (subparagraph 27) of Article 2 of the Law);

- the organizer of public procurement is determined by the customer to perform the procedures for organizing and conducting public procurement.

The organizer of public procurement may also be an official of the customer who represents the interests of the latter in upcoming public procurement, except in cases where the customer and the organizer of public procurement act in one person.

The organizer of public procurement may be the customer himself, directly or in the person of his structural unit responsible for the implementation of procedures for the organization and conduct of public procurement.

The customer has the right to designate the subordinate state institution of the customer as the organizer of public procurement. The customer has the right to act as the organizer of public procurement for several government agencies subordinate to the customer. The customer has the right to identify the organizer of public procurement among several government agencies subordinate to the customer.

The budget program administrator has the right to act as an organizer of public procurement for a government agency subordinate to him, a legal entity in respect of which he acts as a government agency, or a person affiliated with a legal entity in respect of which the budget program administrator acts as a government agency.

A state-owned enterprise has the right to act as an organizer of public procurement for its affiliated entities.

A legal entity with fifty percent or more of the voting shares (participation shares in the authorized capital) owned by the State is entitled to act as an organizer of public procurement for persons affiliated with it (Article 7 of the Law);

- a single organizer of public procurement is a legal entity designated by the Government, the akimat of a region, a city of republican significance and the capital, or the akimat of a district, city, or district in a city that performs procedures for organizing and conducting public procurement (subparagraph 16) of Article 2 of the Law). Government Decree No. 300 of April 2, 2014 designated the Public Procurement Committee of the Ministry of Finance as the sole organizer of public procurement.;

- commission – the tender (auction) commission is a collegial body established by the organizer of public procurement to carry out the procedure for conducting public procurement by the method of tender (auction) provided for by Law. The tender commission (auction commission) must consist of an odd number, but not less than three persons (subparagraph 10) of Article 2 of the Law);

- the expert – an individual with special and (or) technical knowledge, experience and qualifications in the field of public procurement, supported by relevant documents (diplomas, certificates, certificates and other documents), engaged by the organizer of public procurement or the customer to participate in the development of technical specifications and (or) technical specifications of the purchased goods, works, services and (or) preparation of an expert opinion on the compliance of potential suppliers' proposals with the technical specifications of the purchased goods, works, services (subparagraph 26) of Article 2 of the Law);

- a single operator in the field of public procurement is a legal entity designated by the authorized body in the field of public procurement, the sole owner of shares (shares in the authorized capital) of which is the state (subparagraph 20) of Article 2 of the Law). By Order of the Minister of Finance No. 243 dated March 31, 2015, the limited liability partnership "Electronic Commerce Center" was designated as the single operator in the field of electronic public procurement.

If the customer enters into a public procurement contract with another supplier based on the results of a tender, the results of which are being appealed in court, the named supplier is subject to participation in the case as a defendant.

If, in the above case, only actions (inaction) or decisions of subjects of the public procurement system are appealed (without challenging the public procurement contract), in accordance with Article 52 of the CPC, the supplier with whom such a contract is concluded is subject to involvement in the case as a third party who does not make independent claims on the subject of the dispute, on the side of the defendant, because the decision in the case may affect his rights and legitimate interests.

Definition of the legal relations of the parties and the law to be followed.

The legal relations of the parties in cases related to the contesting by potential suppliers of actions (inaction), decisions of the tender commissions, arise from the application of the Law in the organization and conduct of a public procurement tender, the provision by a potential supplier of applications and documents for participation in the tender, conclusions and decisions of the tender commission based on the results of its conduct. Thus, the subject of the dispute is the illegality of the action (inaction), the decision of the competition commission in the form of a protocol on admission (preliminary admission) to participate in the competition, the protocol on the results of the competition.

The basis of the application is violations of the requirements of the law committed by the tender commission, which resulted in the refusal of admission to participate in the tender of a potential supplier, the rejection of his tender application, and the recognition of another potential supplier as the winner.

Facts to be established and proved, evidence and proof.

Consideration of cases in this category requires verification of compliance of actions and decisions of subjects of the public procurement system with legal requirements.

Paragraph 138 of the Rules for Public Procurement establishes that a potential supplier is not allowed to participate in the tender (recognition as a participant in the tender) after bringing applications for participation in the tender in accordance with the qualification requirements and the requirements of the tender documentation, if:

1) he and (or) the subcontractor (co-executor) attracted by him are determined not to meet the qualification requirements and conditions of the tender documentation on the grounds defined by the Law and the Rules of Public Procurement;

2) he violated the requirements of article 6 of the Law.

The list of qualification requirements for potential suppliers is established by paragraph 1 of Article 9 of the Law. Potential suppliers, in order to confirm their compliance with the qualification requirements, submit relevant documents to the organizer of public procurement.

Article 6 of the Law establishes the grounds on which a potential supplier is not entitled to participate in public procurement.

Based on the results of the examination of applications for compliance of potential suppliers with the qualification requirements and the requirements of the tender documentation, the tender commission draws up a protocol of preliminary admission to participate in the tender, containing information about potential suppliers whose applications for participation in the tender were rejected with a detailed description of the reasons for the rejection, including information and documents confirming their non-compliance with the qualification requirements. and the requirements of the tender documentation.

Such potential suppliers are given the right to bring applications into compliance within three working days from the date of posting the protocol of preliminary admission to participate in the tender on the public procurement web portal. Potential suppliers who have violated article 6 of the Law are not granted the right to bring applications into compliance. If potential suppliers meet the qualification requirements and the requirements of the tender documentation, the protocol of preliminary admission to participate in the tender is not drawn up.

Based on the results of the repeated review of applications for participation in the tender, potential suppliers who meet the qualification requirements and the requirements of the tender documentation are determined.

Based on the specified requirements of the Law, the courts, when considering cases of this category, need to examine the protocols of preliminary admission to participate in the tender and the protocol drawn up by the tender commission based on the results of the tender, to establish the applicant's compliance with the qualification requirements and the requirements of the tender documentation for the ongoing public procurement tender.

When verifying the actions of the organizer of public procurement, courts should check whether the list of qualification requirements imposed by the customer on potential suppliers complies with the Law, taking into account that the specified list established by Article 9 of the Law is exhaustive.

Example.

LLP "A" filed a lawsuit with the Construction Department to declare illegal the actions of the organizer of public procurement in conducting public procurement by electronic tender, invalidate and cancel the public procurement contract concluded with LLP "B".

Satisfying the plaintiff's claims, the court proceeded from the fact that the organizer of public procurement rejected the tender application of LLP "A" due to the failure to provide a certificate of absence of debt to JSC "N-Bank", since the supplier's tender documentation contains information about the presence of a settlement account with the specified bank.

However, the court found that the competition commission had established a qualification requirement not provided for in paragraph 1 of Article 9 of the Law, and violated the principles of legal regulation of public procurement provided for in subparagraph 2) of Article 4 of the Law on providing potential suppliers with equal opportunities to participate in the public procurement procedure.

As a result of a misinterpretation of the Law, the organizers of public procurement admit the facts of unjustified refusal to allow potential suppliers to participate in public procurement.

In accordance with subparagraph 8) of paragraph 1 of Article 6 of the Law, a potential supplier is not entitled to participate in ongoing public procurement if the potential supplier and (or) the subcontractor (co-executor) attracted by him have unfulfilled obligations under executive documents and are included by the authorized body implementing state policy and state regulation of activities in the field of enforcement of executive documents, to the Unified Register of Debtors.

Example.

On the above-mentioned grounds, the organizer of public procurement, GU PS, rejected the tender application of JSC Company C, since at the time of the tender, JSC Company C was in the unified register of debtors in enforcement proceedings to recover the amount of 926 tenge in favor of B. and a fine in the amount of 926 tenge to the state revenue.

It was established that JSC "Company C" had no unfulfilled obligations, since the defendant executed the enforcement documents before submitting the application for participation in the tender, however, the body authorized to maintain the Unified Register of Debtors did not timely exclude it from this register.

The content of subparagraph 8) of paragraph 1 of Article 6 of the Law indicates that a potential supplier is not entitled to participate in public procurement if there are two conditions: 1) there are outstanding obligations under enforcement documents, 2) inclusion in the Unified Register of Debtors.

The organizer of public procurement, having established the status of JSC "Company C" in the Unified Register of Debtors, did not establish the actual existence of unfulfilled obligations under the executive documents, which led to the unjustified rejection of a potential supplier from participating in the tender.

List of documents attached to the application (statement of claim)

In accordance with the requirements of the first part of Article 149 of the CPC:

1) a document confirming the sending of copies of the statement (statement of claim) and attached documents to the defendant or his representative to third parties on paper or in the form of an electronic document (receipt from the post office, screenshot, etc.);

2) a document on payment of the state duty (Article 104 of the CPC, Article 535 of the Tax Code);

3) a power of attorney or other document certifying the representative's authority;

4) documents confirming the circumstances on which the applicant (plaintiff) bases his claims:

- a copy of the tender documentation developed by the customer (organizer of public procurement), posted on the web portal of public procurement, the list of which is set out in paragraph 2 of Article 12 of the Law of December 4, 2015 "On Public Procurement";

- if it is impossible to submit documents, the application (statement of claim) in accordance with subparagraph 6) of the first part of Article 149 of the CPC is accompanied by the petition of the applicant (plaintiff) to demand evidence from the defendant.;

- a copy of the applicant's (potential supplier's) application for participation in the competition, as well as copies of the documents submitted by the potential supplier for participation in the competition when submitting the application;

- a copy of the protocol of preliminary admission to participate in the competition;

- protocol on the results of public procurement;

- if the customer enters into a public procurement contract with another potential supplier based on the results of the tender, a copy of the concluded public procurement contract is attached to the application (statement of claim).;

- other documents that, in the opinion of the applicant (plaintiff), confirm the unreasonableness of the refusal of the customer (organizer) to participate in the competition or the rejection of the tender application;

5) the complaint of a potential supplier addressed to the authorized body, as well as the decision of the authorized body adopted based on the results of its consideration, in case of appeal to the court of the decision of the authorized body based on the results of the complaint;

6) copies of the charter, certificate or certificate of state registration (re-registration), if the application is filed (claim filed) by a legal entity, or a copy of the identity document and the document on registration as an individual entrepreneur, if the application is filed (claim filed) by an individual entrepreneur.

In accordance with the requirements of the second part of Article 149 of the CPC:

The application (statement of claim) submitted in the form of an electronic document shall be accompanied in electronic form by copies of the documents specified in the first part of Article 149 of the CPC.

Laws to be applied in the consideration and resolution of cases, depending on the subject matter and grounds of the claim

The Constitution.

GK.

GPC.

The Business Code.

The Budget Code.

The Environmental Code.

Laws:

- dated December 4, 2015 "On Public Procurement" (hereinafter referred to as the Law);

- dated July 16, 2001 No. 242-II "On Architectural, urban planning and construction activities in the Republic of Kazakhstan";

- dated November 9, 2004, No. 603 "On Technical Regulation";

- dated March 15, 1999, No. 349-I "On State Secrets";

- May 16, 2014 No. 202-V "On Permits and Notifications";

- dated November 12, 2015 No. 392-V "On State Audit and Financial Control".

Regulatory Resolution of the Supreme Court of December 14, 2012 No. 5 "On the application of legislation on public procurement by courts".

Government Resolutions:

- dated April 2, 2014 No. 300 "On the formation of the Public Procurement Committee of the Ministry of Finance of the Republic of Kazakhstan";

- dated December 31, 2015, No. 1200 "On Public Procurement using a special procedure".

Orders of the Minister of Finance:

- No. 648 dated December 11, 2015 "On Approval of the Rules for Public Procurement" (hereinafter referred to as the Rules for Public Procurement);

- No. 694 dated December 28, 2015 "On Approval of the Rules for the Formation and Maintenance of Registers in the field of public procurement";

- dated February 22, 2017 No. 130 "On Approval of the List of goods, works, and services for which the organization and conduct of public procurement is carried out by a single organizer";

- dated February 29, 2016 No. 91 "On Approval of the List of Goods, Works, and Services for which Public Procurement is carried out by Means of a Tender with Preliminary Qualification Selection and Amendments and Additions to the Order of the Minister of Finance of the Republic of Kazakhstan dated December 28, 2015 No. 694 "On Approval of the Rules for the Formation and Maintenance of Registers in the field of public procurement".

- dated March 31, 2015 No. 243 "On the definition of a single operator in the field of electronic public procurement"

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