A complaint was filed with the State Audit Service of Ukraine regarding violation of legal requirements during the procurement.

Kryukov Railway Car Building Plant

The contract of Kryukovsky Railcar Building Plant for the supply of 100 passenger cars, the cost of which is UAH 3 billion, is under threat, reports Railway Supply magazine with reference to telegraf.in.ua

The experts of the League of Antitrust prepared an appeal regarding violations of the requirements of the legislation during the negotiated procurement procedure by Ukrzaliznytsia (that is, procurement without a tender from one participant). The State Audit Office of Ukraine should check the legality of using the negotiation procedure and assess the actions of the customer.

KVSZ together with Ferrexpo are testing a prototype dump car

If the State Audit Office of Ukraine recognizes the complaint as justified, the purchase may be canceled: the customer will be obliged to terminate the concluded contract.

Recall that in June, UZ, after an unsuccessful attempt to hold a tender, announced the negotiation procedure for the purchase of 100 passenger cars from KVSZ. The contract was solemnly signed on June 25.

According to the law, the negotiated procurement procedure is carried out as an exception – or after two unsuccessful attempts to hold a tender; or with additional justification from the customer why the goods are purchased from one manufacturer.

Ukrzaliznytsia submitted a justification based on a survey of some car manufacturers and an expert opinion from the Lviv branch of the Dnipro National University of Railway Transport that none of the declared manufacturers will be able to produce 100 cars in 12 months.

Now the “League of Antitrust” questions the conclusion of the “experts”.

“Thus, Ukrzaliznytsia creates a dangerous precedent that jeopardizes the efficiency of the use of public funds and can be used in the future in order to avoid competitive procedures, including by other customers”, the newspaper Nashi Groshi writes.

Why the procedure of “negotiating” UZ for 100 wagons is illegal, explains in detail the expert of the “League of Antitrust” Vladimir Datsenko (previously known for the activities of the project “Railroad without corruption”).

“Firstly, the conclusion of the railway university is not a proper justification for the lack of competition. Secondly, the “experts” of the university calculated the time from the “zero stage” of production – taking into account the development of technical requirements, scientific and design work, etc.

Although, in fact, we are only talking about obtaining a certificate of conformity for wagons of European or Chinese production, which have already been manufactured for years. Thus, the “expert” certificate, as well as the very justification of the negotiation procedure, is based on manipulation and wishful thinking, “writes Vladimir Datsenko.

He points out that the overpayment under this contract could be 15% – compared to the price that would be the result of a competitive purchase.

“After all, it is 15% cheaper that Egypt buys compartment cars at a tender in which manufacturers from five countries took part,” Datsenko points out.

KVSZ has not yet responded to the complaint. Earlier, the chairman of the supervisory board Volodymyr Prikhodko publicly on the company’s website thanked the President of Ukraine Volodymyr Zelenskyy, the Prime Minister of Ukraine, the head of the UZ and everyone involved in the conclusion of this contract.

The source recalls that Zelensky promised a “specific state order” to the railcar building plant, having visited the enterprises in March 2020.


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