Energy Club is initiating an open dialogue between representatives of the government, the energy business, and other stakeholders to discuss a critical issue that has arisen from the interpretation by the Grand Chamber of the Supreme Court (ruling of January 24, 2024, in case № 922/2321/22) of the norm in the Law “On Public Procurement” regarding the 10% limit on contract price changes.
This interpretation, which limits the cumulative price increase to 10% of the initial contract value for the entire duration of the agreement, creates significant risks for the stability of energy resource supply, especially for budget-funded institutions. It also fails to account for the substantial volatility of energy markets, exacerbated by the conditions of martial law.
Energy Club has already conducted internal consultations with community members and sent an official appeal to the relevant Committee of the Verkhovna Rada. The next step is an open discussion to jointly search for balanced solutions.
Invited Participants:
- Members of the Parliament of Ukraine (Verkhovna Rada Committees on Energy and Housing and Communal Services, Legal Policy)
- Representatives of the Ministry of Energy, Ministry of Economy
- Representatives of the National Energy and Utilities Regulatory Commission (NEURC)
- Representatives of Energy Club member companies
- Representatives of procuring entities (budget-funded institutions and organizations)
- Lawyers and experts in public procurement and energy
Discussion Questions:
- What specific practical difficulties do energy suppliers face when fulfilling procurement contracts due to the Supreme Court’s Grand Chamber interpretation regarding the 10% cumulative price change limit?
- What risks (financial, operational, reputational) do suppliers face due to the inability to adequately respond to market price fluctuations exceeding the 10% limit?
- How does the current situation affect the stability of energy supply to budget-funded institutions (schools, hospitals, critical infrastructure facilities)? What problems do procuring entities encounter?
- How well does the current interpretation of the 10% limit correspond to the actual price volatility in the electricity and natural gas markets in Ukraine, especially under martial law conditions?
- How does the restriction affect competition during tenders? Does it lead to inflated initial prices or companies refusing to participate in procurement?
- Is there a need to amend the Law “On Public Procurement” to regulate this issue? What specific changes could be effective?
- Can official clarifications (e.g., from the Ministry of Economy as the authorized body, or from the relevant Verkhovna Rada Committee) help establish a unified practice for applying the norm without changing the law itself?
- How can the formation of a balanced and unified judicial practice on this issue be facilitated, considering the review of case № 920/19/24 and other similar cases?
- What immediate steps can legislators, government agencies, and market participants take to resolve the outlined problem?
Moderator
Maksym Nemchynov
Vice President of Energy Club, former Deputy Minister of Energy of Ukraine
Speakers:
- Iryna Sopylyuk, Deputy Director of the Department of Public Procurement and Competition Policy – Head of the Public Procurement Department of the Ministry of Economy of Ukraine
- Oleksandr Banasko, judge of the Grand Chamber of the Supreme Court
- Volodymyr Polishchuk, lecturer-coordinator of the Department of Teacher Training (Trainers) at the National School of Judges of Ukraine
- Tetiana Kurman, Doctor of Law, Professor, Head of the Department of Land and Agrarian Law at Yaroslav Mudryi National Law University
- Oleksandr Kudym, Director of Euro Trade Energy LLC
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