E-procurement system: Automated transfer of data of beneficial owners (AM0058)

Develop and implement a new e-procurement system that should:
1. Ensure automatic compliance with the requirements prescribed by the Law of the Republic of Armenia "On procurement" and secondary 12 legislative acts in procurement processes (Automatic compliance enforcement); 2. Automate, as much as possible, the functions of clients and participants (Automation of all key business processes); 3. Ensure, as much as possible, machine processing of data (machine readability); 4. Ensure effective access to data and information for the public and policy-makers; 5. Increase — through the implementation of a digital environment based on platform logic — the efficiency of client-participant interactions, while minimising the significance of "being familiar" with procedures as a competitive advantage. In particular, o Digital "shop" o Soft iterative standards o Other platform solutions 6. Ensure interoperability with treasury systems in force, reducing the operational risks; 7. Increase the efficiency of the work of relevant bodies through an automated risk identification system; 8. Provide a digital environment for management of procurement contracts; 9. Guarantee interoperability with both state (e.g. other modules of the "Government Finance Management Information System", the State Register of the Ministry of Justice (Registry of Declarations of Beneficial Owners), the Declaration System of the Commission for the Prevention of Corruption, etc.) and private (e.g. banking) systems; 10. Ensure the necessary traceability of all decisions rendered in the procurement process; 11. Enable the integration of private modules; 12. Provide the opportunity for interested parties to record issues via notification platform (e.g. texts, pictures and videos) as per the contract and the persons having signed it (client, contractor), with the possibility of locating them. An opportunity to create public accountability for recording contract issues.

Problem Definition

1. What problem does the commitment aim to address?

Increasing the level of transparency and effectiveness of the procurement system, use of the system by all clients, existence of a new modern, full national system of e-procurement integrated with other systems relating to the procurements system and including all business processes. The Republic of Armenia has undertaken the commitment to carry out the introduction of the institute of beneficial owners; hence, in order to ensure comprehensiveness, it is necessary to ensure the interoperability for identifying data.

2. What are the causes of the problem? The current system does not ensure the opportunity to include all clients, it is impossible to fully ensure receipt of information based on both all business processes and open data. Despite the fact that the process of revealing beneficial owners has been introduced in Armenia, the steps made are not necessary for fully achieving reduction of corruption processes. A need arises to ensure interoperability with other systems and registers operating in Armenia.

Commitment Description

1. What has been done so far to solve the problem?

In 2023, the activities for developing the Terms of Reference of the new e-procurement system were completed. The document was submitted for public discussion in May 2023; besides, in May-June, its discussion and editing work was organised with clients, representatives of civil society, and business sector. The Terms of Reference were discussed and approved by the Information Systems Management Board. For the purpose of organising the competition, a decision of the Government of the Republic of Armenia on defining the specifics of organising the process was developed and approved, following the approval whereof, a two-stage competition was announced. Four organisations have been pre-qualified: AWS, Oracle, Ebidtopay, and European Dynamics, who the final negotiations of the first stage have been completed with, as of January 2025, and the final Terms of Reference have been presented to the organisations. The portion of the proposals submitted by the pre-qualified participants that were deemed acceptable has been included in the Terms of Reference. At the session of the Competition Commission of 27 March 2025, the 14 invitation to the 2nd stage of the competition was approved and provided to the pre-qualified participants. Participants' bids have been opened and are currently in the evaluation phase. The evaluation of participants' bids has been completed. A winning participant has been selected. It is planned to sign a contract by the end of 2025.

2. What are the solutions we propose?

Elaborate a new e-procurement system that complies with contemporary requirements, based on the principles outlined in the Committment Description.

3. What results do we want to achieve by implementing this commitment?

Have an e-procurement system based on the principles outlined in the Commitment Description.

Commitment Analysis

1. How will the commitment promote the transparency?

The e-procurement system based on open data will provide the opportunity to make complete information on the organisation of procurement procedures and management of contracts available on the Internet free-of-charge and automatically.

2. How will the commitment help to foster accountability?

Public availability of information on organisations participating in procurement, submission of declaration on beneficial owners and provision of information on the winning organisation will improve accountability and transparency of decision-making.

3. How will the commitment improve citizen participation in defining, implementing, and monitoring solutions?

Representatives of CSOs, the media and other organizations have the opportunity to regularly study and analyse the procurement process and implementation of obligations by the winning organizations as a result thereof. As a result, it will be possible to implement public oversight of actions taken and decisions made at all stages of procurement, with a possibility of traceability.

Commitment Planning

Milestones | Expected Outputs | Expected Completion Date

Action 1. Launch of testing activities | Development of software by the selected contractor and launch of testing activities | July 2027

Action 2. Integration of the register of beneficial owners | Integration of the new system of e-procurement with the software of the Register of Beneficial Owners of the State Register of Legal Entities of the Ministry of Justice — automatic receipt of information on beneficial owners of resident bidders of the Republic of Armenia having submitted bids for participation in the procurement procedures prescribed by the legislation of the Republic of Armenia, publications thereof on the Internet, and data exchange via the interoperability
platform of the Government, where necessary. | December 2027

Action 3. Transfer of data (including the declaration of beneficial owner) of organizations having participated in the procurement process | Integration of complete information (including the declaration of beneficial owner) of organisations that are bidders of the procurement process in the current declaration system of the Commission for the Prevention of Corruption December 2027