Rules and procedure for the auction

For the sale of various property that becomes the property of the state, banks or other institutions, auctions are held in accordance with all the rules. Bidding is required when finding a customer for the implementation of various services or work on the basis of state contracts. Most often, electronic bidding is used to attract many participants to the process, who may be in different regions of the country. In this case, the correct procedure for holding the auction must be followed, otherwise its results may be challenged in court.

The concept of electronic auctions

This procedure is governed by the provisions of Federal Law No. 44. An auction held in electronic form is submitted by bidding, where participants can purchase various items by raising the price or pretend to sign a contract by lowering the price. The procedure for conducting an electronic auction involves taking into account the following nuances:

• procurement information is placed in the UIS to an unlimited or limited number of potential participants;
• documents related to such tenders are freely available;
• all participants are subject to the same requirements;
• the procedure is performed on a special electronic platform with the help of its operator;
• the winner is the participant who has offered the highest price for a sold item or the lowest price for a government contract.

Bidding can be conducted not only by government agencies, but also by private companies. They can be closed or open. Often, joint tenders are held at all, where one lot is offered the opportunity to conclude a contract with several customers.

Where is the process running?

The procedure for conducting contests and auctions requires the necessary competent selection of an electronic site for these purposes. This site is represented by a website on the Internet where electronic bidding is directly carried out. If the process is carried out for the state, then only pre-selected and tested sites are selected for this.

There are 6 electronic platforms:

• CJSC Sberbank-AST.
• RTS-Tender LLC.
• JSC "Unified electronic trading platform."
• National electronic site.
• State Unitary Enterprise "Agency on the state order of the Republic of Tatarstan".
• All-Russian universal trading platform (RAD).

They are used for procurement by government agencies. To participate in the auction requires the participants to have electronic signatures and accreditation at a specific site.

When are electronic auctions required?

There are certain situations in which the customer is required to conduct electronic bidding. All of them are specified in the legislation. The procedure for conducting an electronic auction indicates that such tenders can only be carried out subject to the following conditions:

• it is possible to generate an accurate description of a specific procurement object;
• the winner is determined on the basis of a quantitative or monetary criterion.

Commercial companies can use tenders for the sale of various objects or purchases. They are subject to less stringent requirements.

How does accreditation happen?

The procedure for holding an open auction is the need for accreditation of all participants on the selected site. For this, documents are prepared that are listed in the Federal Law No. 44. These include company registration papers, a power of attorney issued for a representative, as well as various licenses and permits for specific activities.

Within 5 days after the transfer of this documentation, the operator of the trading platform accredits the participant. This process may be denied, so the applicant will be notified accordingly.

When can a denial of accreditation be received?

The procedure for conducting an auction in electronic form is the need for accreditation by all participants. Often they are refused in this process. It can be due to various reasons:

• the necessary documents for accreditation were not transferred to the operator;
• false information about a potential participant is provided;
• documents that do not meet the requirements of the law are transferred;
• an offshore organization plans to act as a participant.

If accreditation is performed, then its validity period is three years. After that, the participant only needs to submit applications for participation in various tenders. Three months before the expiration of the accreditation period, the operator sends a notification to the participant. A participant can re-pass accreditation, but not earlier than six months before the expiration of the current permit.

Procedure for organizing auctions

As an object of such bidding, different items can be used. Public procurement is most often carried out through auctions or leased and sold land, real estate or other property owned by the state. Although the object can be anything, the identical auction procedure is used. To do this, the customer performs sequential actions:

• preparations are made for tenders, for which purchases or sales are planned, a commission is formed, a regulation on the commission is developed, and, if necessary, an intermediary who performs the function of a commission is involved;
• documents are prepared for bidding, which include the general provisions, an information card, the form by which participants make applications, the rationale for the NMTSH, terms of reference and project;
• information on electronic bidding is placed in the UIS;
• all participants are determined, for which existing applications are studied;
• a protocol for consideration of applications is drawn up;
• Direct bidding is held, where participants raise rates or reduce the value of the contract;
• the winner is determined, for which a compilation protocol is drawn up;
• a contract is concluded with the winner, after which the contractor makes a security or uses a bank guarantee.

If you understand what the procedure for holding land auctions or tenders for the execution of the contract is, then it will not be difficult to find a buyer, tenant or contractor.

What actions are performed by the participants?

The correct procedure for holding joint tenders and auctions implies the need for certain actions to be performed by all bidders. They are as follows:

• initially, the participant must receive an electronic signature, without which it is impossible to participate in the auction;
• accreditation is carried out at the selected site;
• information on specific tenders is evaluated, for which the UIS database is used;
• documentation is downloaded to allow you to study the rules of participation;
• The received data on the contract or the sold item is analyzed;
• a decision is made on participation;
• depositing funds to the electronic site account, which acts as a guarantee of participation in the auction;
• after transferring funds, it becomes possible to send an application for participation;
• a two-part application is prepared and sent, and the documents listed in the auction documentation are attached to it;
• direct participation in tenders, for which applications are submitted based on the initial price;
• if a particular participant wins the auction, then he signs a contract with the customer;
• Preparing the execution of the agreement, represented by a bank guarantee or payment order;
• if an auction was held to sell any property, then funds are prepared that are transferred to the customer.

The procedure for holding land auctions suggests that only after the conclusion of the contract is it possible to register the right to purchased land in Rosreestr. In this case, the contract of sale is the title document.

The nuances of an auction to buy land or real estate

If citizens or companies wish to acquire different property from the state represented by land or real estate, then an auction is required for this. No bidding is required if there are no other potential buyers.

The procedure for the auction of land or real estate involves the use of electronic platforms. The winner is the participant who has offered the highest price for the object. Bidding is held both for the purchase of land, and for registration of its lease. The customer is a representative of the municipal authority of a particular region. The procedure for holding an auction of land is similar to bidding for the execution of various contracts.

Closed auction nuances

Some contracts are awarded on the basis of closed auctions, in which only strictly defined participants can participate. The procedure for holding a closed auction assumes that bid information is not placed in open sources. Only a limited number of potential participants are informed about the process.

The remaining actions are identical. The bidders receive information on the objectives and subject of bidding. They make security payments, after which tenders are held. A contract is signed with the bidder who won the auction.

Joint bidding rules

The procedure for conducting joint tenders and auctions is established by the provisions of the Federal Law No. 44. The following are specific features of such tenders:

• during the auction, several customers are simultaneously purchasing;
• the right to combine several tenders is granted exclusively when purchasing homogeneous goods or services;
• with the winner of the tender, contracts are concluded by all firms-customers;
• the auction procedure is standard, but for this purpose a special agreement is drawn up between the customers, where their rights and obligations are differentiated;
• the procurement authority is determined, and a commission is formed and approved;
• Tender documentation is developed and agreed jointly by several customers;
• The starting price is calculated taking into account the wishes of each company;
• the powers vested in officials are determined, and their duties and responsibilities are indicated;
• differentiated costs of the auction between all customers;
• The date of the auction is determined.

Mandatory agreement between all customers is drawn up in writing. Additionally, principles are determined on the basis of which disputed issues will be settled. If the procedure for conducting a joint auction by at least one customer is not followed, then this leads to difficulties in conducting tenders.

Process timeline

The period during which electronic bidding is carried out depends on various factors, which include the amount of the contract or item being sold, the number of participants, the form of the auction and other parameters. Based on the procedure for conducting an auction under Federal Law 44, the procedure is divided into several stages:

• participant accreditation - 5 days;
• placing information about the auction - 7 days before the process or 15 days if the initial amount exceeds 3 million rubles .;
• placing auction information in the system - within 2 days after receiving a request from the operator of the selected electronic site;
• An auction is held on a strictly defined day;
• 10 minutes are given for applying for a price change;
• within 30 minutes after the end of the auction, information about the winner is posted in the UIS.

The term depends on the number of applications and the initial price. Therefore, the time of the auction may vary significantly in different situations.

Requirements for Participants

In order for the auction procedure to be correct and in accordance with the law, certain requirements are imposed on participants. These include:

• the participant may be a citizen or company;
• individuals can be registered as individuals;
• there are no specific requirements for firms, so it does not matter what their form of ownership, organizational form or place of registration are;
• depending on the subject of the auction, the requirements for different licenses, permits, permits of the SRO or other factors that can cope with different works may vary significantly.

All these requirements are given in the auction documentation, laid out for free access. After studying this information, each potential bidder will be able to understand whether he can bid.

Application Rules

The procedure for holding an auction for the sale of land or for signing a contract for the performance of any work requires the participants to submit the correct application. It consists of two parts:

• the first part depends on the subject of the auction represented by the goods, work or service;
• the second part includes the participant’s documentation, so with the help of the submitted papers, the customer can understand what the name of the company or citizen’s name, address, location, contact details and other information confirming compliance with the requirements of the tender.

Customers cannot demand from the participants more documents than those listed in the Federal Law No. 44. Submission of the application is allowed at any time from the moment of posting information on the date and place of the auction. It is presented in two parts to the operator of a specific electronic platform. Within one hour, she is assigned an individual number, after which the participant receives confirmation of the acceptance of the document.

Nuances of bidding

On the appointed day and time, a direct auction is held with the following nuances:

• bidders may raise or lower the price depending on the subject of bidding;
• the change may be zero, greater than or equal to the previous sentence;
• the established auction step is taken into account during bidding;
• all proposals submitted by participants are recorded by the operator of the electronic platform;
• change is given only 10 minutes after the last price change;
• if there is no other relevant offer in the set period of time, then the auction ends automatically, for which special technical means and programs are used;
• within 30 minutes after the end of bidding, the operator places a bid protocol containing information about the winner.

The procedure is performed by each participant using special computer programs, which makes it easy to cope with the correct filing of applications and setting prices.

What is contained in the protocol?

The procedure for holding an auction assumes that a protocol is necessarily formed at the end of the auction. It includes information:

• name of the electronic platform on which the auction was held;
• date and time of the auction;
• NMCC;
• All price offers made by bidders are listed, and they are ranked in descending order.

Initially, such a protocol is published on the website of the electronic platform, after which it is sent to the customer and participants within one hour.

The operators of all sites must ensure the continuity of the electronic auction. They must monitor the reliability and serviceability of the work of various programs and technical means.

When is an auction declared void?

There are certain conditions under which electronic bidding is considered invalid. These include:

• not a single application has been submitted;
• there is only one bid by the time the auction ends;
• a decision is made by the commission on the impossibility of admitting all participants to the auction;
• within 10 minutes there was no proposal to raise or lower the price;
• in a timely manner, the bidder who won the tender did not transfer the necessary documentation to the customer, did not transfer funds for the object, or did not ensure the execution of the contract.

Information that the auction is not held must be published on the site’s website.

Contract Rules

With the bidder who won the tender, a contract must be concluded within 10 days from the moment the minutes of the end of the auction are drawn up. If the participants have different disagreements under the agreement, then a protocol of disagreements signed by the EDS is drawn up and placed in the UIS.

Within 3 days after the placement of such a protocol, the document is considered by the customer and a revised contract is provided.

Conclusion

Electronic auctions are mandatory for finding executors of government contracts or selling various government assets, which include real estate, land or other items. Participants must have an EDS and accreditation at the selected electronic site.

An electronic auction is carried out in the correct sequence of actions, for which the subject of bidding and other features of the process are taken into account. The procedure involves the use of computer programs and special technical equipment belonging to the operator of the selected site.