Ruling of the Supreme Court Judicial Division for Economic Disputes of 9 February 2017 № 305-КГ16-15387

Court: Supreme Court

Legal issue: Whether a company may be allowed to take part in a government tender (in the form of request for quotation), if it offers zero price (0.00 RUR)?

Ratio decidendi: Сourts wrongly proceeded from the idea that zero price characterizes the contract as gratuitous and that it is contrary to the purposes of state procurement solely because such offer is not commensurate to the minimal expenses borne by the winner. However, when determining the winner, it does not matter whether the proposed contract is feasible for him; the only thing which matters is price. Besides, the procurement legislation does not prohibit statements in the offer that goods or services are procured without consideration, and the lack of consideration does not constitute a ground for declining such offer.  This conclusion accords to the principles of procurement system aiming at the efficiency of buying goods or services for governmental or municipal needs. Such offer does not restrict competition, because it does not prevent other bidders to offer the same terms of contract. This distinguishes the request for quotation from an electronic contract where offering zero price of a contract is not admissible.

Subject area:
Economic activities, finances public procurement