Ukrainian tender underway for Kyiv Bypass Road

In August 2020, Kyrylo Tymoshenko, a Deputy Head of the Office of the President of Ukraine, and Oleksandr Kubrakov, the Head of the State Road Agency of Ukraine, officially announced the commencement of construction of the Great Bypass Road around Kyiv. As a result, the Kyiv Regional Department of the State Road Agency of Ukraine (i.e., the “Employer”) arranged and carried out the tender for preparing the project design documentation for separate sections of the road.

On 3 June 2021, to speed up the realisation of the Project, the Supreme Council of Ukraine passed the Law of Ukraine No. 1530-IX, which excluded procurement of works and services required for the Project from the actions of the Law of Ukraine “On Public Procurement”. Instead of public procurement rules, the Cabinet of Ministers of Ukraine (CMU) adopted Resolution “On the Implementation of an Experimental Project for the Construction of Great Bypass Road around the Kyiv City” No. 1271, dated 6 December 2021.

The Resolution defines:

• the governmental bodies and agencies that are authorised to organise the construction of Kyiv Bypass Road and other general matters;
• the technical characteristics of the Project;
• the contractors’ selection procedure and the criteria for such selection;
• the period within which the Employer should enter into a contract with a selected contractor.

As of 10 December 2021, the Employer has announced the beginning of the public procurement procedure for the construction of the first section of the Kyiv Bypass Road – the 18 km segment that stretches from Kyiv-Kovel-Yagodyn highway (M-07) to Kyiv-Chop highway (M-06). The public procurement was designed to be finished by 8 February 2022. It is also expected that the Employer will soon announce the procurement of constriction works and related services regarding the other six segments of Kyiv Bypass Road.

Project’s general matters

In the Resolution, the CMU decided that the Ministry of Infrastructure of Ukraine, the State Service of Roadways of Ukraine, and the Employer are responsible for the organisation and implementation of this experimental Project. The CMU has authorised the Employer to contract works and services for the Project. This agency is also responsible for the contractors’ selection, which contractors might be selected for the implementation of the entire Project, or for the construction of a separate road sections. The selection and awarding of contracts could be realized for the whole Project or in parts.

Technical characteristics of Kyiv Bypass Road

According to the Resolution, the building of the Kyiv Bypass Road anticipates construction and renovation of seven separate objects, which include:

• construction of the first segment: from Kyiv-Kovel-Yagodyn highway (М-07) to Kyiv-Chop highway (М-06);
• construction of the connecting section from Kyiv-Chop highway (M-06) to Kyiv-Odesa highway (M-05);
• renovation of the connecting section: Odesa highway (M-05) and Kyiv-Znamianka road (N-01);
• construction of the bridge across the Dnipro River with roadways to Kyiv-Znamianka highway (N-01) and Hora-Rohoziv road (Kyiv Region);
• construction of the connecting section from Kyiv-Rohoziv road to Kyiv-Kharkiv-Dovzhanksyi highway (M-03);
• renovation of the Kyiv’s North-Eastern bypass road at the Ivankiv-Bezuhlivka segment; and
• renovation of the part of Kyiv-Chernihiv-Novi Yarylovychi road from Kalynivka Village to the Kyiv’s North-Eastern bypass road (Р-03).

Selection of contractors

For the purposes of contractors’ selection, the Employer will communicate with bidders via the online electronic system “Playtender”, the platform that is certified with the Ukrainian e-procurement operator ProZorro.

The selection process is arranged and managed by the Committee specially formed for the Project by the Employer. This Committee is allowed to engage external experts if the selection process requires special knowledge or experience.

The Committee is responsible for:

• drafting and approving an announcement of the selection procedure, and tender documentation, as well as arranging their publication;
• consideration and evaluation of bids at all stages of selection;
• clarifications to the participants of the selection;
• selection of a winner; and
• other functions necessary to ensure the selection for the Project and signing of a contract.

The selection takes place in three stages:

• expression of interest by companies;
• submission of proposals; and
• evaluation of commercial proposals and the Committee’s vote.

The selection procedure is completed after the tender winner, who offered the most cost-effective proposal, has been announced.

The Employer and the winner should negotiate a contract regarding the tendered works and services within 20 working days from the date of announcement of the tender’s results. The Employer may extend this term for an additional ten working days should the winner apply for such a prolongation.

When negotiating a contract, the parties to the contract should consider the relevant provisions of the Civil Code of Ukraine, the Commercial Code of Ukraine, the Law of Ukraine” On Highways“, taking into account the peculiarities established by the Resolution of CMU No. 668 ”On Approval of General Conditions for the Conclusion and Execution of Contracts in Capital Construction". The latter regulations entitle the parties, among others, to use the international standard forms of construction contracts, such as FIDIC contracts.

However, since the Project falls outside the Law of Ukraine “On Public Procurement”, a participant in the selection process cannot make a swift appeal to the Antimonopoly Committee of Ukraine for any potentially unlawful decisions, actions, or omissions of the Employer. Therefore, all claims regarding violations of the Resolution can only be appealed to the courts.

For more information on this tender process, contact your CMS client partner or local CMS experts: Natalia Kushniruk, Anna Pogrebna.