Public Procurement in Uzbekistan: General Overview

The public procurement system is one of the most important tools of state economic policy, ensuring the rational use of budgetary funds, fostering competition, and reducing corruption risks. In the Republic of Uzbekistan, this field is regulated by the Law "On Public Procurement" (No. ZRU-684, April 22, 2021), which established unified approaches to procurement procedures, expanded electronic procurement mechanisms, and strengthened anti-corruption safeguards.

The main objective of the legislation is to regulate relations in the field of public procurement, ensure transparency and efficiency of expenditures, and create conditions for fair competition.

Procurement Stakeholders

The law identifies the following participants:

• State customers – budgetary and corporate organizations with state share ≥ 50%;
• Procurement commissions – collegial bodies ensuring impartiality of procedures;
• Specialized organizations engaged for procurement activities;
• Experts and expert organizations;
• Procurement participants – individuals and legal entities (residents and non-residents);
• Suppliers/contractors – winners of procurement procedures;
• Operators of electronic systems.

Such institutional diversity is designed to minimize conflicts of interest and enhance accountability.

Procedures and Mechanisms

The law provides for several types of procurement procedures:

• Electronic store;
• Simplified small-scale procurement;
• Reverse auction (bidding to lower the starting price);
• Selection of the best proposals;
• Tender;
• Two-stage procurement;
• Direct contracts.

General Requirements for Public Procurement

The public procurement system is an essential mechanism for the effective and rational use of budgetary funds, as well as a tool for achieving the strategic objectives of the state. The Law of the Republic of Uzbekistan "On Public Procurement" establishes the foundations of regulation, key principles, stages, and requirements for participants.

1. Principles of Public Procurement

The general requirements are based on the following legal principles:

• Professionalism and responsibility – responsible officials must have specialized education and professional training;
• Justification – procurement must consider necessity, quality, and consumer properties of goods/services;
• Rationality and efficiency – optimal balance of price, quality, and delivery times;
• Openness and transparency – mandatory publication of information on the official procurement portal;
• Competition and objectivity – equal conditions for participants and impartial evaluation of proposals;
• Proportionality – procedure must correspond to the value and risks of the deal;
• Sustainability – consideration of economic, environmental, and social effects;
• Unity of the system – harmonized legal and informational infrastructure;
• Anti-corruption orientation – prevention of abuse and conflicts of interest.

2. Stages of the Procurement Process

According to Article 26 of the Law, public procurement includes four key stages:

1. Planning – preparation of annual and quarterly procurement plans, publication on the procurement portal;
2. Procurement procedures – choice of procurement method (electronic store, simplified procedure, auction, tender, etc.);
3. Contract conclusion and execution – formalization of terms, guarantees, and quality control;
4. Monitoring – state oversight, maintaining registers, and ensuring transparency of implementation.

3. Requirements for Participants

To ensure fairness, participants must meet the following criteria:

• Availability of necessary technical, financial, and human resources;
• Legal capacity to enter into contracts;
• No outstanding tax liabilities or unenforced court judgments;
• Not undergoing bankruptcy proceedings;
• Not listed in the Unified Register of Unreliable Suppliers.

Additional qualifications may be required depending on the specifics of goods/services procured.

4. Information Transparency and Electronic Systems

The law requires full, reliable, and objective disclosure of procurement data: plans, announcements, results, contract registers, and the register of unreliable suppliers.

The system is supported by:

• The official procurement information portal;
• The electronic public procurement system;
• The Unified Register of Contracts;
• The Unified Register of Unreliable Suppliers.

5. Restrictions and Prohibitions

To prevent abuse, the law establishes the following restrictions:

• Prohibition of negotiations between the customer and participants prior to winner determination;
• Ban on conflicts of interest and affiliation;
• Prohibition of discrimination, artificial splitting of contracts, collusion, and submission of unrealistically low bids;
• Mandatory confirmation of available financing sources.

These requirements form a comprehensive system aimed at transparency, fair competition, and rational use of public resources.

Comparative Characteristics of Procurement Methods

Procurement Method	Short Description	Advantages	Disadvantages / Limitations
Electronic Store	Placement of supplier offers in the system, customer selects and initiates a price request	Speed, simplicity, automation, price transparency	Limited to transactions below a set threshold, mainly for standard goods/services
Simplified Small-Scale Procurement	Price comparison from open sources or minimum 3 suppliers	Short timelines, flexibility, low transaction costs	Applicable only to small procurements (≤ 50 Basic Calculation Values)
Reverse Auction	Online bidding, winner chosen by lowest price	High transparency, maximum budget savings	Risk of dumping, reduced quality
Best Proposal Selection	Evaluation based on price + additional criteria (delivery, quality, terms)	Balance of price and quality, flexible evaluation	Subjectivity, requires strong documentation
Tender	Competitive process, winner offers best execution terms	Wide competition, comprehensive evaluation	Lengthy process, higher admin costs
Two-Stage Procurement	For complex/innovative goods; includes discussion + final bids	Suitable for technical/innovative projects	Long timelines, organizational complexity
Direct Contracts	Awarded without competition (specific legal cases)	Simplicity, speed, few suppliers	High corruption risks, limited competition

The adoption of the Law "On Public Procurement" was a key step in reforming Uzbekistan’s financial and economic system. Its provisions reflect modern international standards, including electronic procurement, anti-corruption mechanisms, and sustainability principles. However, effective implementation still requires improvements in monitoring procedures, professional training, and law-enforcement practices.

Thus, Uzbekistan’s public procurement legislation forms a systemic approach that balances efficiency of public spending with the protection of public interests.