1. What does make a procurement contract lucrative for business?
A procurement contract is a profitable deal for an entrepreneur because it boosts business and protects the interests of both the government and a contractor.
It guarantees sale and payment for goods and services to a buyer (government) for a fixed price set in advance in the contract. It makes you a reliable vendor confirmed by the governmental information system.
2. Can foreign companies operate in the Russian procurement market?
Yes, they can. Russian Law "On Federal Contract System" stipulates that foreign companies are allowed to participate in procurement purchases as long as they comply with certain rules. Most procurement transactions are conducted through internet now and participants need to have an electronic digital signature, issued to resident companies in accordance with the Russian Government’s standards.
Specifically, to be able to participate in electronic sales of goods (which covers 70—80% of the total procurement order market), one must:
- open a branch of a foreign company in Russia;
- in order to submit orders and sign a procurement contract, obtain an electronic digital signature in the name of an individual, certified to be accredited, in the Russian Certification Center;
- submit corporate documents of a parent company to the site operator and receive accreditation from the electronic trading site.
3. Can foreign companies operate in the American procurement market?
Yes, they can. To this end, they must open a US branch or representative office, get a tax ID No. (FEIN) and register on respective procurement websites online.