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System for regulation of local content in public procurement to be used in Kazakhstan

Business Materials 23 September 2019 16:42 (UTC +04:00)

Baku, Azerbaijan, September 23

By Nargiz Sadikhova - Trend:

The centralization of public procurement will be introduced in Kazakhstan starting from 2020, which provides for the transfer of all public procurement to single organizers at the appropriate levels, which will allow to effectively regulate local content in public procurement, the Minister of Finance of Kazakhstan Alikhan Smailov said, Trend reports with reference to the press office of prime minister of Kazakhstan.

This became known during the Government session chaired by the Prime Minister oh Kazakhstan Askar Mamin.

According to Smailov, from January 1, 2019, Article 14 of the Law “On Public Procurement” gave the Government of Kazakhstan the right to establish exemptions from the national regime, including for the purpose of supporting domestic producers.

“For these purposes, an exemption from the national regime for a period of two years was established for three commodity items: motor vehicles, transformers, cable products,” Smailov said.

In July 2019, a format-logical control was established on the web portal, which does not allow customers and suppliers to sign acts without entering certificates of origin of goods. As Smailov noted, this will help to determine an objective picture of the local content in public procurement and facilitate monitoring.

At the same time, from July 1, 2019, state purchases of furniture and light industry goods are carried out only among domestic producers, through preliminary qualification selection, where the main criterion for choosing a supplier is the presence of an Industrial certificate.

In addition, model agreements on public procurement of construction works have been developed, within the framework of which from July 1, 2019, only construction materials included in the Register of Domestic Producers are used in public procurement of construction works.

Also, from September 1, 2019, public procurement of construction work is also carried out exclusively through pre-qualification of bidders, in this case, the criterion is an indicator of financial stability.

“Given that this indicator is formed according to the information of state revenue authorities and only for Kazakhstan taxpayers, this norm will also support domestic business,” Smailov assured.

Starting January 1, 2020, government procurements provide for similar support measures for the services of creating and developing informatization facilities, as well as software and products for the electronics industry.

The main criterion for entering the preliminary qualification selection is the presence in the Register of trusted products, which includes only domestic developers.

“The Pilot mode, centralization of public procurement will be introduced starting from 2020, which provides for the transfer of all public procurement to single organizers at the appropriate levels. After testing and editing inaccuracies, this model will be distributed throughout the republic. The number of organizers will significantly decrease. Administration is simplified, this will allow to effectively regulate local content in public procurement,” Smailov summarized.

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