The goal and principles of the ProZorro.Sale reform

ProZorro.Sale — ProZorro.Продажі

ProZorro.Sale is a system initiated by the Ministry of Economic Development and Trade of Ukraine, Transparency International Ukraine, the Deposit Guarantee Fund, the National Bank of Ukraine and the Ukrainian electronic platforms. The system is designed in accordance to the values and principles of the ProZorro family.

Our goal is a transparent, fast and effective sales of state and communal property, as well as fighting against corruption by the means of equal access to data, public control and increasing number of the potential buyers

Objectives of reform

  1. Regular efforts applied to corruption prevention and eradication

  2. Transparency of the auction process

  3. Inadmissibility of discrimination and objective assessment of offers

  4. Simple and easy in use application procedures

  5. Transition to electronic document flow

  6. Full reporting and analysis of public sales

Principles of reform

  1. Maximum engagement of all of the stakeholders to the reform

  2. Open decision-making procedures

  3. Crowdsourcing and involvement of society at large

  4. Governmental modules of the central database and auction and integrated private electronic platforms

  5. Opensource software, standard protocols of data exchange

  6. Step by step implementation based on “from simple to complex” principle

About the reform of state and communal property in Ukraine

Currently, the normative and institutional base is being developed in Ukraine and its aim is to provide adequate regulation of the property sales mechanism through traditional and electronic markets based on the rules similar to the EU or USA. 

Also, formal compliance to the norms of Ukrainian legislation does not ensure transparent, effective and fair procedures for property sale. Because of these problems, state and communal property has been unsold for years depreciating their value and reducing the state budgetary revenues. Misuse of the unsold property also leads to increased levels of corruption. ProZorro.Sale system is a project that integrates business trading practices into the public sector providing for the full control of the project implementation to society. 

The practice of the pilot project (since 31 October 2016) demonstrates efficiency and effectiveness to all of the process’s sides: state, business and society.

The core of the reform

Development and implementation of an electronic system of property sales owned by the banks going bankrupt of a particular segments of the state property market (woods, property in use, non-core assets) and later it will be rent and small-scale privatization. 

In the ProZorro.Sale system, the central database and auction module are developed jointly by the team of the pilot project and Transparency International Ukraine, and then will be administered and controlled by the state. Until the transfer, the central database and auction module are controlled by Transparency International Ukraine. 

More details about auction process of the system are available.

The reform budget:

  • Development of the central modules of the system is financed by the electronic trading platforms.
  • The price of basic system’s development was about 10 thousand dollars.
  • Development and maintenance of the full-scale system (software) that will be able to include all of the Deposit Guarantee Fund’s lots in electronic form required a sum of about 120 thousand dollars.

The strategy of the reform

  • Development of the general concept of the reform.
  • Implementation of the pilot project on the pilot lots.:
  • Development of the technical design specifications – done
  • Engagement of the electronic platforms – done
  • Development of the MVP – done
  • Implementation on the pilot lots – done
  • Implementation of the comfortable instruments for reporting and analysis – done
  • Expansion of the electronic system to all of the trades – done
  • Connection of all of the existing exchanges to the CDB – done
  • Preparation of the infrastructure of the banks that are in the liquidation procedure – done
  • Training of the liquidators – in the process of execution
  • Mandatory transition to the electronic system for all of the banks’ assets sold – done
  • Amendment of the current legislation is carried out
  • Development of the state infrastructure – until 01.06.17
  • Development and start of the CDB 2 – sales of the particular state property types (woods, property in use, non-core assets) and later – rent and small-scale privatization – since 03.04.17