On October 09, 2024, the National Agency held a working meeting with the Ministry of Economy of Ukraine on the issue of participation of non-resident business entities in the tender for the selection of managers through the Prozorro.Prodazhi.

In accordance with Article 21 of the Special Law of Ukraine “On the National Agency of Ukraine for finding, tracing and management of assets derived from corruption and other crimes”, the National Agency transfers the management of the assets to the legal entities or individual entrepreneurs selected by the tender in accordance with the procedure established by the legislation on state (public) procurement.

Earlier, ARMA asked the State Tax Administration to clarify whether foreign business entities should participate in tenders for the management of seized assets on an equal footing with Ukrainian participants.

The issue has been resolved, the special law on ARMA does not restrict the rights of foreign entities, and according to the Law of Ukraine “On Public Procurement,” the winning bidder must provide documents confirming certain information in accordance with Ukrainian law.

However, the participation of a non-resident business entity makes it impossible to fulfill these requirements because this entity is not a legal entity registered in accordance with Ukrainian law.

Therefore, the Agency has raised questions about obtaining additional clarification from the Ministry of Economy on the possibility of a foreign entity providing documents from its country similar to Ukrainian ones. Such non-discrimination and transparency will ensure not only equality of all participants, but also the creation of an attractive investment climate and the expansion of competitiveness for the country's recovery.

At the joint working meeting, the Ministry of Economy of Ukraine clarified that non-resident business entities have the right to participate in procurement through the ProZorro system by providing similar documents created in accordance with the laws of the state of registration.

ARMA emphasized that in accordance with paragraph 37 of part 1 of Article 1 of the Law of Ukraine “On Public Procurement”, a participant in a procurement procedure/simplified procurement (hereinafter referred to as a participant) is an individual, individual entrepreneur or legal entity - resident or non-resident, including an association of participants, which submitted a tender offer/proposal or participated in negotiations in case of application of a negotiation procurement procedure.

The National Agency, together with the Ministry of Economy, has taken systematic measures to engage business representatives from partner countries to ensure equal, competitive and transparent mechanisms for their participation in tenders for the management of seized assets.

Therefore, a non-resident business entity, such as an official representative office, separate structural unit or branch, is required to be registered in Ukraine only if it wins the tender for the selection of a manager to enter into a management agreement with ARMA, pay salaries, pay taxes on business activities and pay income to the budget of Ukraine.

For all interested non-resident entities, please read the relevant explanations and the overview of procurement practices here.