New in Prozorro: Procurement for Donor-Funded Projects

The complex and lengthy procedures in international projects, which had long been known to “discourage” potential contractors or suppliers, only worsened the situation. However, starting in 2022, the volume of donor funding grew substantially, and the projects themselves became more urgent.

For years, international partners had pointed out that Ukraine’s public procurement rules were not suitable for donor-funded programs. After all, each donor organization has its own approach to setting tender participant requirements, evaluating proposals, and communicating with bidders. At the same time, Ukrainian businesses that wanted to participate in tenders had to search for announcements separately on each donor’s website (sometimes announcements were available only in paper form in specialized publications) and prepare a large volume of documentation.

The Ministry of Economy acknowledged the problem, and in 2022, the Prozorro team, within the framework of the USAID and UK Dev “Digital Transformation Support” (DTA) project, began developing a procurement procedure for donor-funded projects that takes into account the requirements of international organizations. At Prozorro, we understood that forcing donors to operate under Ukrainian rules would mean losing their assistance. Therefore, we created a highly flexible procedure that makes it possible to adapt procurements to any international standards. In 2023, a new module—”donor procurement”—was launched. It allows tenders to be aligned with the rules of a specific donor while also ensuring that every procurement is transparent to the public. This means that donors can oversee the use of funds, businesses gain access to a new market, and citizens can see that aid is contributing to the country’s recovery.

How Prozorro changed the process

The procedure allows international organizations to decide for themselves whether the procurement will take place in an auction format, as well as to specify supplier selection criteria, currency, and quantitative and qualitative requirements for goods or services.

Today, companies can see up-to-date donor announcements on the Prozorro platform. This means businesses now have easier access to a large market—the opportunity to offer goods and services for projects funded by international partners. For donors, this means greater competition and more favorable terms.

Thanks to the publication of all procurements on a single platform, by December 2024—just one year and four months after the procedure was launched—the number of participants in some procurements had already reached 10. The current average level of competition is 2.07 participants.

However, a full comparison with the previous period is not possible. Previously, donor procurements were published on donors’ own websites, information was fragmented, and participant numbers were not always available. According to the bi.prozorro module, average competition at that time did not exceed 1.6 participants.

For example, ten companies applied for a procurement under the new procedure, including leading IT players such as Luxoft, Epam, and Intellias. This was an important achievement since previously, even in large IT projects, the number of participants usually did not exceed three.

Since the launch of the donor module in Prozorro, a total of 288 procurements with an expected value of UAH 3.3 billion have been announced. These include the procurement of a cable system for Okhmatdyt under the Ministry of Health and World Bank HEAL Ukraine project, as well as the procurement of computer equipment for the Ministry of Social Policy funded by the World Bank.

While taking into account each donor’s specifics, the procedure preserves transparency and competition. This means that every citizen can see what donor funds were spent on and under what conditions. The main features of the new procedure:

• Rules: If an international treaty or the rules of an international financial organization provide for a procurement procedure different from Ukrainian law, those norms apply (now—through Prozorro), while respecting the principles set out in Article 5 of the Law of Ukraine “On Public Procurement.” If no such rules are established, procurements are conducted in accordance with Ukrainian law.
• Co-financing: In projects co-financed by international donors, procurements in Prozorro are carried out under the rules of these donors. If such rules are absent, national legislation applies.
• Special procedures: international donors may stipulate additional requirements or features in procedural manuals that reflect the specifics of a loan, credit, or grant.

Donors and their projects

Among Ukraine’s key partners are USAID, the World Bank, and the International Committee of the Red Cross. Together, they signed 156 contracts in Prozorro worth UAH 2.27 billion. For example:

• In July 2024, the World Bank funded the procurement of autonomous charging stations for hospitals.
• USAID supported the procurement of medical equipment in 2024–2025.
• The International Committee of the Red Cross restored water and power networks in affected regions (Chernihiv, Marhanets, Kherson) during 2024.

What next?

Some international organizations are still not present in Prozorro, as they use their own systems or rules and are cautiously considering the possibility of moving to Prozorro.

However, Ukraine continues to improve the procurement system by integrating international standards and automating processes. Priorities include further digitization and automation of procurements. In parallel, we are working to engage a broader circle of donors and to strengthen partnerships.

For donors, this means greater confidence that their projects are implemented under unified, transparent rules and with the possibility of public oversight. For citizens, it is a guarantee that aid is directed specifically to Ukraine’s recovery and an opportunity to track its results. For entrepreneurs, it also simplifies work: instead of searching through scattered announcements, businesses now have a single platform with up-to-date tender offers and can participate in electronic auctions as usual.