The White House is reforming the model of protectionism in government procurement, adapting it to changing geopolitical conditions and the concept of “friendly” and “unfriendly” countries. On Thursday, the government approved a bill from the Ministry of Finance on uniform rules for the application of national treatment – equal access of Russian and foreign suppliers to procurement by the state and state-owned companies. After its adoption, the White House will be able to flexibly introduce bans and restrictions on the purchase of imports by the state and state-owned companies. International treaties will become a limitation for exemptions – de facto, they should now contain direct rules on the possibility of granting or not granting national treatment in procurement. This means that new “friendly” partners of the Russian Federation will be able to receive preferences and access to government orders.
At a meeting on Thursday, the government approved a bill from the Ministry of Finance for submission to the State Duma, reforming the system of providing preferences to domestic suppliers in government orders. As Prime Minister Mikhail Mishustin explained, the rules for procurement and selection of the winner should become as simple and understandable as possible for all parties, they should be based on the “unconditional priority of Russian brands.”
The bill introduces uniform rules for providing national treatment in procurement by the state (44-FZ) and state-owned companies (223-FZ) – equal access to tenders for Russian and foreign suppliers. Let us clarify that in general, all bidders receive equal access to the procedure, but the government can establish exceptions and provide advantages to domestic suppliers – in the form of preferences for them and through bans and restrictions on the supply of imported products.
The current system of protectionist measures does not suit the Ministry of Finance because of its complexity: the mechanisms are regulated by nine by-laws at once, and the lists of goods are not consistent with each other, the department said earlier. In the new design, the Ministry of Finance will abandon some of the current mechanisms – for example, the “third wheel” rule, retaining only the “second wheel” (refusal of foreign products if there is an offer from a Russian manufacturer). The price preference for Russian goods will be 15% (that is, in fact, they can be so much more expensive than imported analogues). If competition arises between several Russian products, the product with a higher technological level of production will have an advantage.
Now preferential regimes are widespread and regulated in 44-FZ, but the government order market is assessed by the government as insufficient to support Russian manufacturers (its volumes are several times less than the volumes of purchases by state companies). Supporters of protectionism have long insisted on the introduction of unequal procurement conditions for 223-FZ, but their initiatives were not supported due to the Russian Federation’s international obligations on free trade. The development of the bill became possible with the start of the military operation in Ukraine and the expansion of sanctions, as well as after the strengthening of global protectionist tendencies and the recognition of the actual inoperability of the WTO institutions.
According to the bill, the government will be able to introduce exceptions from the national regime in cases where the international treaties of the Russian Federation provide for the possibility of not providing it – that is, now the international treaties of the Russian Federation must contain direct rules stating that the other party is or is not subject to the national regime. As Maria Lisichenkova, senior lawyer of the antimonopoly practice of the Delcredere Bar Association, explains, now the national regime refers to products manufactured both in Russia and in other EAEU countries. Meanwhile, the Eurasian Economic Commission noted that, despite the obligations in accordance with the Treaty establishing the EAEU, in practice the countries of the “five” are not ready to fully ensure the provision of national treatment in procurement.
Earlier, Artem Grinenko, deputy director of the budget policy department in the contract system of the Ministry of Finance, explained that there are international agreements under which national regime is provided to different states: on obligations under the WTO, the CIS and the EAEU. At the same time, he noted that the Ministry of Finance will use the possibilities of international treaties and draw up a “palette of decisions for the circle of persons, the range of purchases” to introduce preferences for Russian suppliers: we are talking about loopholes that relate to certain types of purchases (for example, broadly interpreted non-commercial) or some product categories.
Let us note that, taking into account the projected changes, the Russian authorities will be able to make decisions in two directions: to massively identify loopholes in existing agreements (in the context of ineffective WTO institutions), and in new agreements – to use preferential access to the market as a “bargain deal” with new “friendly” ones. partners.