On the application of legislation on public procurement

When considering cases in this category, it is necessary to be guided by the Law, and in matters not regulated by Law.,

- the norms of the Civil Code, the Civil Procedure Code of the Republic of Kazakhstan (hereinafter - CPC),

The Administrative Procedural Code of the Republic of Kazakhstan (hereinafter referred to as the APPC),

The Law of the Republic of Kazakhstan dated November 12, 2015 No. 392-V "On State Audit and Financial Control" (hereinafter - the Law on State Audit) and other regulatory acts.

Courts should distinguish between disputes arising in the process of selecting a supplier and concluding a public procurement contract with him, the procedure for which is regulated by the rules of the CPC, and disputes arising from a public procurement contract, which are considered in civil proceedings in accordance with the norms of the CPC.

In accordance with Article 29 of the CPC, claims arising from public procurement contracts are filed at the location of the defendant.

Claims arising from public procurement contracts, which specify the place of execution, may also be filed at the place of execution of the contract, at the choice of the plaintiff, in accordance with part six of Article 30 of the CPC.

In accordance with paragraph 1 of Article 24, paragraph 4 of Article 38 of the Law, the submission of an application for participation in public procurement (price offer) is a form of consent to supply goods, perform work, and provide services in accordance with the requirements and conditions established by the tender documentation.

In this regard, claims for recognition of a potential supplier as an unscrupulous participant in public procurement conducted by these methods, at the choice of the plaintiff, may also be filed at the place of execution prior to the contract.

Challenging the results of public procurement, decisions of the authorized body on the inclusion of a potential supplier in the register of unscrupulous participants in public procurement, as well as decisions, conclusions, instructions, notifications of the authorized body based on the results of the audit of public procurement, is carried out in accordance with the procedure provided for in part three of Article 106 of the CPC, at the place of residence (residence) of the plaintiff.

If the plaintiff, along with the claim for knowledge of the results of the tender, demands that the concluded agreement on public procurement be declared invalid on this basis, then such claims are subject to joint consideration in a specialized interdistrict administrative court, taking into account the requirements of part three of Article 84, part three of Article 155, part two of Article 156 of the CPC.

In this case, regarding the claim for invalidation of the contract, the plaintiff is not required to comply with the pre-trial dispute settlement procedure provided for in the contract.

Claims of a potential supplier against actions (inaction), decisions of the customer, the organizer of public procurement, the unified organizer of public procurement, the commission, the expert, the unified operator in the field of public procurement, as well as against actions (inaction), decisions of the authorized body and bodies of state audit and financial control are subject to consideration by a specialized interdistrict administrative court.

Claims of organizers of public procurement, customers related to the application of subitems 1) and 3) of the first part of paragraph 4 of Article 12 of the Law, as well as claims arising from the execution of public procurement contracts, are subject to consideration by a specialized interdistrict economic court.

Claims challenging the decision of the authorized body to recognize a potential supplier as an unscrupulous participant in public procurement, recognized as such in accordance with subparagraph 2) The first part of paragraph 4 of Article 12 of the Law is subject to review by a specialized interdistrict administrative court.

By virtue of subparagraph 1) of paragraph 1 of Article 12 of the Law, the authorized body shall form and maintain the republican register of unscrupulous participants in public procurement. In this regard, in accordance with subparagraph 1) According to the first part of Article 151 of the CPC, the judge should refuse to accept a claim for inclusion in the register of unscrupulous participants in public procurement under subparagraph 2) of the first part of paragraph 4 of Article 12 of the Law as not subject to consideration and resolution in civil proceedings.

If the claim is accepted by the court, the court issues a ruling on the termination of the proceedings in this part on the basis of subparagraph 1) of Article 277 of the CPC.

Upon receipt of such a claim in a specialized interdistrict administrative court, on the basis of subparagraph 11) of part two of Article 138 of the CPC, the court (judge) issues a ruling on the return of the claim as not subject to consideration in administrative proceedings.

The courts should keep in mind that the Annexes to the Rules for Public Procurement, approved by the Order of the Minister of Finance of the Republic of Kazakhstan dated December 11, 2015 No. 648 (hereinafter referred to as the Rules), approved a number of Standard Contracts (a Standard contract for public procurement of services provided for by a state social order, a Standard contract for Public Procurement of Goods, a Standard Contract for public procurement of services and others) (yes, a standard contract).

All Standard Contracts provide for a "Dispute resolution" section with identical content, according to which the Customer and the Supplier must make every effort during direct negotiations to resolve all disagreements or disputes arising between them under or in connection with the public procurement contract.

If, after such negotiations, the Customer and the Supplier are unable to resolve the dispute under the agreement, either party may request a resolution of this issue in accordance with the legislation of the Republic of Kazakhstan.

By signing a Standard Contract on these terms, the parties follow the prescribed procedure for pre-trial dispute resolution.

Consequently, when filing a claim, the plaintiff is obliged to attach documents confirming compliance with the procedure for preliminary pre-trial settlement of the dispute provided for in the contract. The absence of relevant evidence confirming compliance with the procedure of preliminary pre-trial or out-of-court dispute settlement is the basis for returning the claim on the basis of subparagraph 1) of the first part of Article 152 of the CPC.

These provisions do not apply to claims for recognition of a potential supplier (supplier) as an unscrupulous participant in public procurement.

When considering administrative claims against decisions of the authorized body on the inclusion of a potential supplier (supplier) in the register of unscrupulous participants in public procurement, in connection with evasion from concluding a public procurement contract, the courts should proceed from the requirements of paragraph 3 of Article 43 of the Law, which establishes the obligation of the winner of public procurement to sign the contract.

If the contract is not signed, the potential supplier must prove that he took all necessary measures to sign it, but due to objective circumstances beyond his control, he was unable to sign it.

When considering claims for recognizing suppliers who have failed to fulfill or improperly fulfilled their obligations under public procurement contracts concluded with them as unscrupulous participants in public procurement, the courts must take into account the supplier's guilt as the basis for civil liability in accordance with Article 359 of the Civil Code and the negative consequences for the customer, based on the criteria of fairness and reasonableness, according to the fifth part of Article 6 of the CPC.

Negative consequences should be understood as causing such damage to a party to a contract that it has largely lost what it was entitled to expect when concluding the contract (paragraph 2 of Article 401 of the Civil Code).

Additional agreements concluded by the parties to the public procurement contract regarding changes in the deadline for work are also subject to evaluation by the courts.

Article 45 of the Law establishes the grounds for making amendments to the draft public procurement contract or the concluded public procurement contract.

In this regard, the courts should keep in mind that if the parties have not made changes to the contract, design estimates in accordance with paragraphs 7), 8), 9) paragraph 2 of Article 45 of the Law, the reference to additional agreements regarding the modification of the deadline provided by the concluded public procurement contract, it is unreasonable.

Failure by the customer to fulfill the obligation assigned to him to send a draft public procurement contract to a potential supplier and a notification of the need to sign a draft public procurement contract is the basis for satisfying an administrative claim to cancel the order of the authorized body to include the potential supplier in the register of unscrupulous participants in public procurement on the grounds of evading the conclusion of the contract.

The courts should keep in mind that an administrative claim to revoke the order of an authorized body to include a potential supplier in the register of unscrupulous participants in public procurement on the grounds of evading the conclusion of a contract is not satisfactory in cases of receipt from a potential supplier.:

- written refusal to conclude an agreement;

- proposals for amendments to the essential terms of the agreement;

- any other written request, the execution of which prevents the customer from concluding a contract on the terms specified in the announcement of public procurement.

Inconsistency in the description of the characteristics of the purchased goods (works, services) indicated in the information posted on the public procurement web portal in accordance with paragraph 1 of Article 38 of the Law, with the actual terms of the draft contract submitted by the customer for conclusion, exempts the potential supplier from concluding the contract and excludes the inclusion of the potential supplier in the register of unscrupulous participants in public procurement based on the avoidance of concluding a public procurement contract.

According to paragraph 4 of article 43 of the Law, the requirements for concluding a public procurement contract through the public procurement web portal do not apply to the cases provided for in paragraphs 4), 9), 17), 18), 20), 21), 23), 26), 31), 32), 35), 40), 41) of paragraph 3 of Article 39 and Article 50 of the Law.

Courts should take these features into account when considering disputes arising on the basis of a public procurement tender, which are governed by the Rules for Public Procurement using a Special Procedure approved by Resolution No. 1200 of the Government of the Republic of Kazakhstan dated December 31, 2015, and disputes where procurement was carried out on a general basis.

Formation of the register of unscrupulous participants in public procurement provided for in subparagraph 2) paragraph 4 of Article 12 of the Law, potential suppliers who evaded the conclusion of a public procurement contract, on the basis of a decision of the authorized body, is not applicable to legal relations arising in the framework of public procurement using a special procedure.

Since the web portal of public procurement does not contain data on a tender conducted using a special procedure, therefore, claims for recognition of such a potential supplier as an unscrupulous participant in public procurement while evading the conclusion of a contract are considered in court.

To explain to the courts that, with regard to subitems 2) of paragraphs 218, paragraph 229 of the Rules, the tender commission has the right to request the necessary information in writing and (or) in the form of an electronic document from relevant government agencies, individuals and legal entities only in order to clarify the information contained in applications for participation in the tender.

It is not allowed to send a request and perform other actions by the competition commission related to supplementing the application for participation in the competition with missing documents, replacing submitted documents, or adjusting documents that are not properly executed after the expiration of the period specified in paragraph 219 of the Rules.

A potential supplier has the right to appeal against 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.:

1) to the authorized body;

2) to court. The plaintiff's compliance with the procedure established for this category of cases before the judicial settlement of the dispute is mandatory, otherwise the claim will be returned in accordance with subparagraph 1) of part 2 of Article 138 of the CPC.

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