Challenging Tender Procedures in the Courts of Uzbekistan

The sphere of public procurement in Uzbekistan is one of the most contentious areas from the standpoint of judicial protection of the rights of participants. This is due to the fact that a tender dispute may arise at different stages of procurement: during the approval of procurement documentation, during the admission or rejection of a participant, during the evaluation of bids, upon cancellation of the tender, during the review of a complaint by the Commission for the Review of Complaints in the Field of Public Procurement, as well as at the stage of performance of an already concluded contract. For this reason, the correct determination is of key importance not only of the subject matter of the claim, but also of the proper judicial jurisdiction: administrative or economic. An error at this stage often leads to the return of the application, loss of time, and weakening of the applicant’s procedural position.

The Law of the Republic of Uzbekistan “On Public Procurement” expressly establishes that a participant, as well as persons exercising control, have the right to appeal against the actions or omissions of the state customer, the procurement commission, its members, and the operator of the electronic system both in court and before the Commission for the Review of Complaints in the Field of Public Procurement. This means that judicial protection in tender disputes is an independent and complete way of protection, and an appeal to the Commission does not always serve as a mandatory prerequisite for going to court.

Tender disputes in Uzbekistan have a mixed legal nature. Before the conclusion of a public procurement contract, the dispute, as a rule, is connected with the exercise of public authority by the state customer or the procurement commission. In this part, the dispute tends toward an administrative-law nature. After the conclusion of the contract, the dispute, on the contrary, usually concerns the performance of obligations: payment, delivery, acceptance, penalties, termination, compulsion to perform, and recovery of damages. Here, a commercial, that is, economic, dispute arises.

This division follows from the procedural codes themselves. The Code of Administrative Court Procedure applies to the consideration of cases on the protection of violated or disputed rights and legitimate interests of citizens and legal entities in administrative proceedings. The Economic Procedural Code, in turn, regulates the procedure for claim proceedings and other categories of cases in economic courts. Consequently, the criterion for distinguishing jurisdiction is not only the composition of the parties, but above all the nature of the disputed legal relationship: public or private-law.

WHEN TO APPLY TO THE ADMINISTRATIVE COURT

It is advisable to apply to the administrative court when the subject matter of the dispute is a decision, action, or omission of an administrative body or official that violates the rights of the procurement participant. In the tender sphere, such claims usually include:

• recognition as unlawful of a decision to admit or not admit a participant;
• recognition as unlawful of the rejection of a tender bid;
• challenging the results of the evaluation of bids;
• recognition as unlawful of the cancellation of a tender;
• challenging the actions of the procurement commission, its members, the state customer, or the operator of the electronic system;
• challenging a decision of the Commission for the Review of Complaints in the Field of Public Procurement.

This approach is logical because Article 185 of the Code of Administrative Court Procedure allows an application to the court if, by a decision, action, or omission of an administrative body, the applicant’s rights have been violated, obstacles to the exercise of their rights have been created, or obligations have been unlawfully imposed. For tender disputes, this mechanism is especially important: the participant has often not yet entered into contractual relations, but has already been deprived of the right to fair participation in the procurement procedure.

The general time limit for applying to the administrative court in such disputes is six months from the moment when the interested person became aware of the violation of their rights, unless another period is established by law. A missed deadline for valid reasons may be restored by the court. For tender disputes, this rule has practical value; however, it is not advisable to delay filing, since procurement procedures are dynamic, and the subsequent conclusion and performance of the contract may complicate restoration of the violated position.

WHEN TO APPLY TO THE ECONOMIC COURT

If the tender has already been completed by the conclusion of a public procurement contract, further disagreements most often become the subject of consideration by the economic court. This concerns claims for recovery of debt, penalties, damages, compulsion to perform an obligation, termination of the contract, recognition of certain contractual terms as violated, return of an advance payment, recovery of the amount of security, and other disputes arising from a commercial obligation. Economic court proceedings by their nature are intended precisely for such claims.

Moreover, the Law “On Public Procurement” itself distinguishes between complaints in the sphere of the procurement procedure and disputes regarding the performance of contractual obligations in public procurement. This confirms that after the stage of selecting the winner and concluding the contract, the dispute shifts from the public sphere to the sphere of performance of obligations.

PRE-TRIAL APPEAL TO THE COMMISSION FOR THE REVIEW OF COMPLAINTS

The Law on Public Procurement grants the participant the right to file a complaint with the Commission for the Review of Complaints in the Field of Public Procurement. Upon receipt of the complaint, the Commission notifies the state customer within three working days and suspends the procurement procedure for a total period of up to ten working days. The complaint is generally reviewed with the participation of the customer and the participant, and a decision on it must be issued within seven working days after receipt of the complaint and posted on the special information portal. If the complaint is found to be justified, the Commission may prohibit unlawful actions, fully or partially cancel unlawful decisions of the customer, complete procurement procedures, or include the contractor in the Unified Register of Unscrupulous Contractors. Decisions of the Commission are binding, and the decision of the Commission itself may be appealed in court.

This makes the commission procedure a powerful operational instrument, especially when it is necessary to quickly stop the procedure before the contract is concluded. However, from a procedural point of view, it is important to understand that filing a complaint with the Commission does not replace judicial protection and does not exclude it. Moreover, in some situations, an immediate application to the court may be strategically preferable, if the dispute goes beyond a formal review of the procedure and requires a deeper assessment of violated rights, evidence of affiliation, conflict of interest, or abuse of discretionary powers.

Types of claims in Administrative and Economic courts