A legal basis is being formed regarding the rules and procedures for determining whether a non-resident legal entity or individual, for whom it has been determined that the procuring organization cannot pay the performance and/or advance payment guarantee, is exempted from the obligation to provide such performance and/or advance payment guarantee.
elchi reports that this is reflected in the proposed amendment to the Law “On Public Procurement”.
According to the draft, it is proposed to determine whether a non-resident legal entity or individual is exempted from the obligation to provide a performance and/or advance payment guarantee based on a decision made by the body (institution) determined by the relevant executive authority, upon the proposals of the supervisory body and the body (institution) determined by the relevant executive authority, or based on a decision to refuse such exemption.
Thus, in cases where the single-source procurement method is applied and it is impossible for the relevant non-resident legal entity or individual suppliers to provide performance or advance payment guarantees, the difficulties arising in the state treasury regarding the fulfillment of obligations undertaken by budgetary organizations towards those suppliers will be eliminated.
It was noted that when paying creditor debts arising from goods, works, and services purchased by budgetary organizations from foreign suppliers through the state treasury, a number of institutions require performance and/or advance payment guarantees from foreign suppliers under procurement contracts, and it is discovered that these guarantees are not provided.
Since there is no exception in the Law of the Republic of Azerbaijan “On Public Procurement” regarding the non-provision of performance and/or advance payment guarantees, the failure to submit these documents makes it impossible for treasury bodies to make payments, and as a result, the purchase of relevant goods, works, and services does not take place.