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2007 Assessment

Azerbaijan: Integrity Indicators Scorecard

Azerbaijan: Integrity Scorecard Report > Sub-Category: Procurement
Indicators		Score
48	Is the public procurement process effective?	55
49	Can citizens access the public procurement process?	88

Indicator and sub-Indicator Details

Is the public procurement process effective?

48a: In law, there are regulations addressing conflicts of interest for public procurement officials.

Score:

YES

Comments: The Procurement Law (article number 13) includes regulations addressing conflicts of interest for public procurement officials. Public procurement officials and their relatives do not have the right to participate in the procurement.

References: Reference: Procurement Law of Azerbaijan Republic.

48b: In law, there is mandatory professional training for public procurement officials.

Score:

YES

Comments: Law on Procurement does not require mandatory professional training for public procurement officials.

References: Reference: Procurement Law of Azerbaijan Republic.

Peer Review Comments: I disagree. Even though the state procurement system is corrupt and there are kick-backs in the bidding, there is training for public procurement officials.

According to the Article 4 of the Law on Public Procurement, the State Agency on Procurement must take part in governing procurements in the country. The Agency prepares rules, instructions and other documents on public procurement and submits them to the appropriate executive authorities. The Agency provides procurement agencies with methodical and organizational assistance while conducting public procurement, gives recommendations and organizes trainings.

48c: In practice, the conflicts of interest regulations for public procurement officials are enforced.

Score:

100

Comments: The Procurement Agency closes its eyes to illegal actions related to state tenders. In practice, there are no clear mechanisms to enforce the conflicts-of-interest regulations for public procurement officials.

References: Reference: Interview with Rovshen Agayev, deputy chairman of the Economic Initatives Center. Reports by the Center for Procurement Research.

Peer Review Comments: The mechanism is not clear.

48d: In law, there is a mechanism that monitors the assets, incomes and spending habits of public procurement officials.

Score:

YES

Comments: There is no mechanism for monitoring the assets, incomes and spending habits of public procurement officials neigher in the Anti-Corruption Law nor in the Procurement Law. In general, no laws provides such mechanisms.

References: Reference: The Legislation of Azerbaijan Republic including Anti-Corruption Law not in Procurement Law.

Peer Review Comments: The Law on Financial Disclosure of Public Officials was not being enforced as of November 2007.

48e: In law, major procurements require competitive bidding.

Score:

YES

Comments: The Law on Procurment (article number 11) requires holding competitive bidding for major procurements. More than three bidders are required to hold tenders.

References: Reference: Law on Procurment of Azerbaijan Republic.

48f: In law, strict formal requirements limit the extent of sole sourcing.

Score:

YES

Comments: The Law on Procurement (article 45) requires strict formal requirements that limit the extent of sole sourcing. All negotiations should be secret, and information can not be transferred to other bidders.

References: Reference: The Law on Procurment of Azerbaijan Republic.

48g: In law, unsuccessful bidders can instigate an official review of procurement decisions.

Score:

YES

Comments: According to the Law on Procurement (article number 57) unsuccessful bidders can instigate an official review of procurement decisions.

References: Reference: Law on Procurement of Azerbaijan Republic.

48h: In law, unsuccessful bidders can challenge procurement decisions in a court of law.

Score:

YES

Comments: The Law on Procurement (article number 60) gives unsuccessful bidders the right to challenge procurement decisions in a court of law.

References: Reference: The Law on Procurement of Azerbaijan Republic.

48i: In law, companies guilty of major violations of procurement regulations (i.e. bribery) are prohibited from participating in future procurement bids.

Score:

YES

Comments: There are no such requirements in the legislation.

References: Reference: The Law on Procurment of Azerbaijan Republic.

Peer Review Comments: The State Agency on Public Procurement has the right to prohibit companies that have violated procurement legislation from participating in future procurement bids.

48j: In practice, companies guilty of major violations of procurement regulations (i.e. bribery) are prohibited from participating in future procurement bids.

Score:

100

Comments: Since there is no public access to the major tenders' bidders, it's difficult to say whether companies guilty of major violations of procurement regulations participate in future procurement bids or not. The law, however, does not prohibit it, therefore they can do it.

References: Reference: Interview with Azer Mehtiyev, chairman of the Economic Initiatives Center. Reports by Center for Economic and Social Development (CESD). www.cesd.az

Can citizens access the public procurement process?

49a: In law, citizens can access public procurement regulations.

Score:

YES

Comments: Citizens can have access to the public procurement process either by visitng the Web site of the Procurement Agency (www.tender.gov.az) or through state newspapers.

References: Reference: The Law on Procurement of Azerbaijan Republic. Reports at www.tender.gov.az

49b: In law, the government is required to publicly announce the results of procurement decisions.

Score:

YES

Comments: The Law on Procurement (article 5.3) requires publicly announcing the results of procurement decisions within five bank days.

References: Reference: The Law on Procurment of Azerbaijan Republic.

49c: In practice, citizens can access public procurement regulations within a reasonable time period.

Score:

100

Comments: All results are published in the state newspapers and posted on the Web site.

References: Reference: Interview with Azer Mehtiyev, chairman of the Economic Initiatives Center. Reports by the Center for Economic and Social Development (CESD). www.cesd.az Reports by Procurement Agency. www.tender.gov.az

Peer Review Comments: But it takes much more time to learn the results.

Peer Review Comments: According to the law, citizens can access public procurement regulations through the media. However, the ministries are reluctant to give the public access to this information, particularly if they have a favored company.

49d: In practice, citizens can access public procurement regulations at a reasonable cost.

Score:

100

Comments: Since all results are published in the state newspapaers and posted on the Web site, no high costs are needed to access the information.

References: Reference: Interview with Azer Mehtiyev, chairman of the Economic Iniatitives Center. Reports by the Center for Economic and Social Development (CESD). www.cesd.az Reports by Procurement Agency. www.tender.gov.az

49e: In practice, major public procurements are effectively advertised.

Score:

100

Comments: In practice, information about major procurement are distributed by the official newspapers. However, that does not mean that major public procurements are effectively advertised. The problem is that such annoucments are usually formal and not all information related to the procurement is covered.

References: Reference: Interview with Azer Mehtiyev, chairman of the Economic Initiatives Center. Reports by the Economic Research Center. www.erc-az.org

Peer Review Comments: Iinformation about major procurements is published only in the official newspapers.

49f: In practice, citizens can access the results of major public procurement bids.

Score:

100

Comments: In practice, there are not any serious problems for citizens having access to the results of major public procurement bids.

References: Reference: Interview with Azer Mehtiyev, chairman of the Economic Initiatives Center. Reports by the Procurement Agency. www.tender.gov.az Reports by CESD. www.cesd.az

Peer Review Comments: No, there are real problems. Even journalists have a very hard time trying to access this information.