The EEC Board announced the removal of the barrier that prevented the access of suppliers from the EAEU to the public procurement market

Last week, the board of the Eurasian Economic Commission recorded the removal of the barrier for suppliers from the EAEU countries to access the public procurement market of the Russian Federation and even an improvement in their position in comparison with Russian ones. The opening of the Russian state order market for allied suppliers was facilitated by the coincidence of large-scale pressure on the Russian authorities from partners in the EAEU and the closure of traditional supply channels for critical imports in the Russian Federation. The shortage of goods and the requirements to fulfill the union agreement forced the RF Ministry of Finance to refuse to support protectionism in public procurement.

Since the beginning of the summer, legal entities and individuals of the EAEU can transfer funds to secure their applications for participation in Russian tenders directly to the customer’s settlement account specified in the notice of purchase. The norm was introduced by the Decree of the Government of the Russian Federation No. 579 of April 10, 2023, but it only came into force on June 1. Its appearance was preceded by a protracted positional struggle among officials of the allied governments to force the Russian Ministry of Finance to comply with the union agreement, although it already has a higher status in relation to national legislation.

The agreement directly requires providing EAEU suppliers with a national regime of access to the state orders of countries, including providing them with two options for securing an application for participation in public procurement – at the expense of a bank guarantee and a cash contribution to the account of the customer, the procurement organizer or the operator of the electronic trading platform. However, in the last decade, the approach of Russian state customers and regulators to the admission of suppliers from the EAEU has been rather arbitrary: suppliers had the right to participate in tenders, however, in order to achieve its implementation, companies from allied countries had to overcome a lot of technical and legal inconveniences. As a result, the share of purchases of goods originating from the EAEU was small – as a rule, such cases were limited to border trade of countries or were still conditioned by Soviet economic ties at the regional level (for example, traditional purchases of Belarusian-made municipal equipment). At the same time, interstate relations also influenced the activity of such trade – in case of contradictions at this level, state customers themselves “showed understanding of the situation”, changing preferences or using the technical difficulties of the participation of foreign suppliers to make “politically correct” purchases.

The situation became even more complicated after 2017 – in the process of digitalization of procurement in the Russian Federation in order to combat collusion between customers and suppliers, the Ministry of Finance required market participants to credit the security of bids at the auction not to customers or organizers of the auction, but to special accounts in authorized banks (the list of which, we note, has arisen after the loss of a large budget deposit in a bank with a revoked license). For suppliers from the EAEU, this became an additional restriction – in order to open a special account, they had to register with the Federal Tax Service and complete a number of formalities.

It took several years for the EEC to fight this norm – the commission achieved recognition that it did not comply with the union agreement in the court of the EAEU, and even after that it took a number of negotiations between the partners in the union at the EEC site with the Russian Ministry of Finance: it could not extend the requirements of special accounts to the EAEU, but did not want to remove it for Russian suppliers. The situation changed dramatically with the introduction of sanctions against the Russian Federation for its military operation in Ukraine: the exit from the market and the refusal to supply Western companies to government agencies made purchases in the EAEU countries virtually uncontested – at least in terms of goods that the Russian economy cannot refuse to import, since they are not produced either in Russia itself or in the EAEU. As a result, the Russian Federation itself had to accelerate the removal of restrictions on the path of such supplies – and the EEC Board at its meeting on June 13, 2023 recorded the “removal of an obstacle with signs of a barrier.”

Oleg Sapozhkov