Sole-Source Procurement in Violation of Justification Conditions as Per Subsection 42, Article 39 of the Republic of Kazakhstan’s Public Procurement Law

According to subsection 42, paragraph 3 of Article 39, local government offices for cities of district significance, villages, settlements, and rural districts may procure uniform goods, services, and works, provided that the annual cost of such procurements does not exceed 3,000 times the Monthly Reference Values set for the respective fiscal year by the Republic’s budget law.

Two types of violations are possible: the procurement size exceeding 3,000 Monthly Reference Values (MRV); and the misuse of this law provision as justification for procurements by other contracting entities (not local government offices for cities of district significance, villages, settlements, and rural districts).

To detect such violations, one can use the public module “Public Procurement Data Analysis of the Republic of Kazakhstan”:

1. Procurement of uniform goods, works, or services with an annual volume exceeding 3,000 MRV. 

• Open the main vertical menu on the left, select the “Analytics” section and then the “Non-competitive Procurements” subsection. Next, on the “Rating” chart, you’ll find the vertical word “Regions” with a small triangle. Clicking on the triangle will display a dropdown menu where you can select “Justification for Procurement Method,” and from it select the justification “per subsection 42.” In the top-right corner of the page, near the settings icon, you’ll find a filter where you can select a period, for example, the current year. Thus, you’ll have a list sorted by justification and year. 
• Next, return to the main vertical menu on the left and open the “Plan Items Table,” where you will see a list of procurements with links to the Public Procurement Portal. You can download the data for further analysis. Within the downloaded procurement list, an evaluation should be conducted to identify plans with the same Universal Classification Codes for Goods, Works, and Services (UCCGWS) that exceed 3,000 MRV.

2. Misuse of this justification by entities other than local government offices for cities of district significance, villages, settlements, and rural districts.

• Open the main vertical menu on the left, and in the “Analytics” section, choose the “Non-competitive Procurements” subsection. Then, in the “Rating” chart on the left, you will find the vertical label “Regions” with a small triangle icon. By clicking on the triangle, a dropdown menu will appear where you can select “Justification for Procurement Method,” and from there, choose “per subsection 42.” In the upper-right corner of the page, next to the “Settings” icon, you will find a filter where you can select a time period, such as the current year. This will produce lists sorted by procurement justification and year.
• In the upper-right corner of the page, next to the “Settings” icon, you will find a filter where you can open the “List of Contracting Entities” and check the list for entities not belonging to local government offices for cities of district significance, villages, settlements, and rural districts.
• The use of filters by budget program administrators is useful for quickly identifying potential violators. 

For more detailed information on how to work with the public business analytics module, you can refer to the webinar materials “Public Monitoring of Government Procurements in the Republic of Kazakhstan” (instructions for the module are from 1:52:02 to 2:16:00).