Participation of foreign companies in Russian public procurement: procedure and restrictions

Many foreign companies in Russia are looking for ways to expand the distribution channels for their products and services. Participation in public procurement provides such an opportunity.

Can foreigners participate in public procurement?

Foreign organizations and individuals can take part in any public procurement, subject to the restrictions on the national regime, the Russian governement decrees and 44-FZ. Such restrictions include the participation of companies from countries from the list of the Ministry of Finance, for example, Belize, Gibraltar, Panama. These are offshore zones - states with preferential tax regimes and countries that do not disclose internal financial information.

There are also a number of restrictions in accordance with the procurement legislation, but they are not found in all tenders. For example, there is a ban on the admission of foreign products for the purposes of the country's defense. We recommend you to study the procurement documentation carefully  before taking part in the tender.

Well, the main difficulty is the language, because all state resources of Russia work only in Russian, and an automatic translator in the browser can not always help to understand what the state buyer wants.

Otherwise, there are no differences from the participation of Russian companies and residents of the Russian Federation.

When accrediting on electronic trading platforms, foreigners provide a duly certified translation of their documents issued in accordance with the legislation of their states.

How to participate in the tender?

If a foreign organization plans to participate in a Russian public procurement, it will have to go through a number of registration procedures. In general, they can be divided into 5 steps.

Step 1. Obtaining a digital signature
The filing of tender applications under 44-FZ, is impossible without a digital signature. Digital signature is issued only by accredited certification centers.

Step 2. Registration in the Unified Register of Procurement Participants (ERUZ)
You have the right to register in the ERUZ, even if you have not yet received an electronic signature. But we recommend you to prepare a digital signature in advance: accreditation of a non-resident in the Russian Federation for tender participation and the submission of applications require confirmation through an electronic signature.

In the presence of an electronic signature, an application is first submitted for registration in the Unified identification and authentication system. As soon as the performer receives accreditation, it will be registered in the register of participants and in the Unified Information System. 

Step 3. Opening a special account
A special account is required to secure applications. Participation in the procurement of a foreign company under 223-FZ and 44-FZ is impossible without providing a security for the application in the form of transferring a specified amount to a special account or a bank guarantee

Step 4. Participation in the public procurement
After receiving an electronic signature, registration in the EIS, ERUZ and on the electronic site, you can start procurement procedures.
Here's how a foreign company can participate:

• Find a tender.
• Look for the object of purchase or the customer name (if previously worked with a specific organization).
• Prepare documents - application, declaration of conformity, price offer.
• Send the application security.
• Send the offer in the personal account of the electronic platform.
• Take part in determining the winner. If a foreign organization participates in the tender, this does not in any way affect the course of the tender - the auction is carried out according to general rules.

If a foreign company won the procurement, it provides the customer with a guarantee of fulfillment of obligations, signs an agreement and implements the order on time.

When holding tenders under 223-FZ, there is a restriction: in the priority of supplying goods, works and services domestically. This is not a ban on the participation of foreign suppliers, but specific price preferences for Russian products (15%). For orders of electronic goods, the preference is 30%.

Step 5. Conclusion of the contract
An agreement with a foreign contractor practically does not differ from a contract that a customer enters into with a Russian supplier. There are two rules for concluding an agreement with a foreign company under 223 FZ or a state contract under 44-FZ.

• Prescribe the price correctly. The contract price is indicated not in rubles, but in the counterparty's currency. Indicate the conversion procedure taking into account the constantly changing exchange rate.
• Duplicate text. This means that the agreement is drawn up in Russian and in the language of the foreign company

In general, the principle of participation of foreign companies and individuals in Russian tenders is no different from the general procedure. Nevertheless, we recommend using the help of specialized specialists or representatives in Russia (lawyers, public procurement specialists, etc.), this will help save time on preparing and submitting documents, as well as significantly increase your chances of concluding a contract. You can leave a request for the service on the website ("Ask a question" on the right side of the page) or by mail office@raspp.ru