From 5 August 2012 a number of important changes were introduced into the rules for public procurement used by state and municipal authorities in Ukraine, including the following:

a) State and municipal authorities (and other organizations and companies that procure goods, services or works using state funds) are no longer required to conduct tenders and comply with the public procurement rules for purchasing the following goods and services:

· financial services relating to the issuance, purchase, sale or transfer of securities or other financial instruments (e.g., services of securities traders, depositories, registrars etc);

· transactions with securities and shares in the charter capital of a company; and

· transactions relating to the purchase and lease of land plots, buildings, other immovable property or propriety rights to immovable property and land plots;

b) State and municipal companies, as well as companies with a state or municipal shareholding exceeding 50 per cent, are no longer required to (i) conduct tenders for the procurement of goods, works and services, and (ii) comply with the public procurement procedure, with the exception of cases when the procurement is financed with state funds;

c) The parties to a public procurement contract may now change the price of the goods, works and services after holding the tender and signing the procurement contract based on the following grounds: changes to the tax rates, currency exchange rates, index of inflation, stock exchange quotations, tariffs and standards applicable to the procurement contract. This change also applies to public procurement contracts entered into before 5 August 2012.
Additional notes
This LEGAL ALERT is issued to inform Baker & McKenzie clients and other interested parties of legal developments that may affect or otherwise be of interest to them. The comments above do not constitute legal or other advice and should not be regarded as a substitute for specific advice in individual cases.

Law of Ukraine No. 5044-VI dated 4 July 2012 "On Amendments to Certain Regulations on Public Procurement in Ukraine".

“State funds” is very broadly defined and includes the funds allocated from municipal budgets, funds received as loans from banks, international financial organizations, foreign states if they are secured with state or municipal guarantees.