The Cabinet of Ministers of Kyrgyzstan has approved new regulations on mandatory banking support for contracts concluded by state and municipal enterprises, as well as companies in which the state holds a 50 percent or greater share in the authorized capital, including their subsidiaries.
The document is aimed at increasing transparency, preventing corruption, and strengthening oversight of spending in public procurement.
Under the new rules, all such entities are required to conduct major procurements with mandatory banking support, in accordance with the established procedures and conditions.
The regulation also determines the list of banks authorized to provide support for these contracts.
In addition, the previously existing public procurement procedures have been amended: certain provisions have been removed, and rules concerning bank support of contracts have been brought into line with the new Cabinet decision.
State bodies and enterprises with more than a 50 percent state share should ensure the implementation of this mechanism in their procurement activities and conclude agreements with authorized banks.
Meanwhile, the State Property Management Agency is tasked with distributing standard banking support terms to all procuring organizations, which must now be included in tender documentation.
The resolution will enter into force in ten days after its official publication.
Banking support is a special control mechanism under which all payments under a state contract are processed through an authorized bank. The bank verifies that funds are spent strictly in accordance with the contract, reducing the risk of fraud and ensuring transparency in procurement.
