Delivering a speech at the parliamentary session of 24 September 2013, Sergo Ratiani stated:  “Today, the universities [after becoming legal entities of public law] face problems with regard to the purchase of books. Those problems are not limited to books but also concern laboratories and reagents.”

FactCheck

took interest in the statement and set out to check the truthfulness of the facts presented.

Based on the resolution of the Georgian Government dated 29-30 July 2013, ten universities previously having the status of state-founded non-entrepreneurial (non-commercial) legal entities were transformed (reorganised) into legal entities of public law.

The change in the status applied to the following universities: Tbilisi State Medical University, Ilia State University, Shota Meskhia Zugdidi State University, Ivane Javakhishvili Tbilisi State University, Akaki Tsereteli State University, State Technical University, Sokhumi State University, Samtskhe-Javakheti State Teaching University, Gori State Teaching University and Iakob Gogebashvili Telavi State University.

The activities of a state-founded non-entrepreneurial (non-commercial) legal entity-higher educational institution are regulated by the Law on Higher Education (amendments introduced on 17 June 2011).

Due to the transformation of the legal status from lepl into the non-entrepreneurial (non-commercial) legal entity a greater degree of flexibility was given to higher educational institutions in the following matters:

  • For the purpose of managing the institution property they were authorised to establish a development fund of the higher educational institution,
  • The procedure of the purchase of books was simplified,
  • A decision of the regent council could provide for a simplified procedure of the purchase of other units and
  • The higher educational institution was allowed to define the internal structure of the institution.

In order to make a comparison between the two statuses we ought to examine how the law defines the procedure of the purchase of books, reagents and laboratories for the state-founded non-entrepreneurial (non-commercial) legal entities-higher educational institutions, on the one hand, and for the legal entities of public law, on the other.

Pursuant to Article 3 Paragraph a.e of the Law of Georgia on State Procurement, an act can be classified as a state procurement if the funds of a legal entity of public law or a non-entrepreneurial (non-commercial) legal entity-higher educational institution are being employed in the process.

According to the general procedure, an electronic tender is held in the case of a state procurement of homogenous objects amounting to GEL 200,000 or more (Article 3, Part1, Paragraph q). A tender notice and tender documents are to be posted at least 20 days prior to the expiration of the deadline for submission of tender bids (Article 12, Part 8).

A simplified electronic tender is held in the case of state procurement for homogeneous procurement objects with a value up to GEL 200,000.  A notice about conducting simplified electronic tender and tender documentations are to be posted on www.spa.ge

no later than three days before the deadline for the acceptance of bids. The timeframe for accepting tender bids under a simplified electronic tender must be at least two days (Article 3, Part 1, Paragraph q). Therefore, a total of five days is required for the procurement of homogenous objects.

Paragraphs i and j in Part 2 of Article 10 of the Law of Georgia on State Procurement specify the cases in which the organisation of a tender is not imperative and the procurement can be conducted directly. Article 10 of the Law discusses electronic methods of state procurement in the form of simplified electronic tenders. Part 3 Paragraph i of the same Article authorises the state-founded non-entrepreneurial (non-commercial) legal entity-higher educational institution and the development fund of a higher educational institution to purchase literature (printed, placed on electronic or audio-visual devices) through a simplified procurement procedure.

Pursuant to Article 10 Part 3 Paragraph k of the Law, the non-entrepreneurial (non-commercial) legal entity-higher educational institution is authorised to perform a state procurement of a value not higher than GEL 200,000. For this purpose the institution is to address the council of regents for an approval. The council of regents represents a collegiate body established by the government which supervises the activities of the state-founded non-entrepreneurial (non-commercial) legal entity-higher educational institution.

The procurement of reagents and laboratories by the non-entrepreneurial (non-commercial) legal entity-higher educational institution is regulated according to the general procedure and depends on the price of goods.

Unlike the non-entrepreneurial (non-commercial) legal entity, the legal entity of public law-higher educational institution is not subject to the special norm on the simplified procedure of procurement. Therefore, the type of electronic tender and the timeframe of procurement depend on the price of books, reagents and laboratories.

Conclusion

A state-founded non-entrepreneurial (non-commercial) legal entity-higher educational institution is authorised to purchase books directly whereas the legal entity of public law is required to conduct a simplified electronic tender.

Lepl as well as non-entrepreneurial (non-commercial) legal entities are required to hold electronic tenders for the procurement of reagents and laboratories if their price exceeds GEL 200,000. In the case if the price does not surpass GEL 200,000 a simplified electronic tender is to be conducted but the non-entrepreneurial (non-commercial) legal entity-higher educational institution is allowed to address the council of regents and with its approval make procurement of up to GEL 200,000 directly, bypassing the electronic tender.

We conclude that Sergo Ratiani’s statement: “Your decision to change the status of universities to the legal entity of public law created problems for them with regard to the purchase of books and those problems are not limited to books but also concern laboratories and reagents,” is TRUE.

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