In Ukraine, there is a need to update the approach to the sale of seized property. This is not about destroying the existing system, but about developing it – through integration with the time-tested platform “Prozorro.Sales”, which at one time changed the electronic auction market. Such a reform will increase the efficiency of bidding, reduce the risks of abuse and create additional opportunities for state-owned enterprises, including SE “SETAM”.
Why changes are necessary
The current model for the sale of seized assets was established in 2015, when SETAM became the sole organizer of auctions and administrator of the electronic system. This approach initially seemed logical, but over time it led to excessive concentration of functions and, as a result, to a conflict of interest. One institution simultaneously creates rules, conducts auctions, and is responsible for the storage of assets.
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The consequences of this approach are known to all market participants: distrust of the system, numerous lawsuits, low trading efficiency. According to data for 2023−2024, SETAM held about 8 thousand auctions, while it had about 1,400 court cases in its work. For comparison: in Prozorro.Sales, over 40 thousand successful auctions and less than ten lawsuits took place over the same period. This clearly shows the difference in approaches and the regulatory environment.
How can SETAM win?
The proposed model does not eliminate SETAM from the process, but, on the contrary, opens up new opportunities for it. The enterprise can become a state custodian of seized property, retaining expertise and relevant functions, and also join Prozorro.Sales as an accredited electronic platform (broker). This will allow SETAM to work not only with seized assets, but also with other markets: privatization, bankruptcy, lease, sale of state bank assets, etc.
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According to forecasts, this could increase the financial capacity of the enterprise by 25-27%, while reducing its operating costs by at least a quarter. Integration with Prozorro.Sales can be financed by donor funds without additional costs to the state budget.
The whole system wins.
The transition to a model in which the Cabinet of Ministers determines the procedure for selling seized property, and Prozorro.Sales acts as the administrator of the electronic system, eliminates the risks of influencing the results of the auctions. In Prozorro.Sales, each lot, each bid, and each participant are open for online verification, and competition between platforms guarantees an increase in the price, not a decrease.
According to World Bank estimates, transparent online auctions increase sales revenue by over 20% compared to pre-reform mechanisms. And the experience of “Prozorro.Sales” in the sale of land, municipal property, or lease rights has already confirmed these conclusions in practice.
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A joint movement towards transparency
The reform of the market for the sale of seized property is not aimed at “replacing” some players with others. Its goal is to make the process fairer and more efficient for everyone: the state, creditors, debtors, and potential buyers.
SETAM can maintain and expand its role in the system by using Prozorro.Sales as a partner platform for transparent work. This will not only eliminate corruption risks, but also pave the way for the development of a state-owned enterprise according to market principles.
In the end, everyone will win: the state will receive more revenue, businesses and citizens will gain trust in the system, and SETAM will gain stable development and new opportunities in the modern digital ecosystem.
Previously, “FACTS” reported how Ukraine reacted to the publication of The Page's material about non-transparent tenders that threaten the country's national security.
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