Who pays on a Ukrainian public contract, and how you get paid

A supplier's first practical question is often: if I deliver, who pays me, and how? The short answer is that the buyer named in the tender pays the winning supplier, under the contract. The details differ for every tender, so you must read them before you bid.

Who pays

• Tenders from Ukrainian buyers. The buyer, such as a city, a utility, a ministry or a state company, signs the contract and pays the supplier from its own budget or funds.
• Projects financed by a donor or a development bank (the World Bank, the EBRD, the EU and others). The money is lent or granted to the Ukrainian client, and the client signs and pays the contracts under the funder's procurement and payment rules. Read the funder's rules and the tender documents for the exact steps.
• If you supply a contractor. If you sell to the company that won the tender instead of bidding yourself, you are paid by that company under your own sales contract, not by the buyer.

Where the payment terms are written

In the tender documents and in the draft contract that comes with them. Look for the payment schedule (an advance, payments by stages, or payment after delivery and acceptance), the currency, the deadline for payment after acceptance, penalties for late delivery, and any bank guarantee the buyer asks you to provide.

Questions to answer before you bid

1. Who exactly pays, and from which budget or loan?
2. Is there an advance payment, and does the buyer ask for a bank guarantee in return?
3. How many days after delivery and acceptance is payment due?
4. In which currency is the contract, and who carries the exchange-rate risk?
5. Will your bank handle payments to and from your country, and what fees apply?
6. What happens if delivery is late or the goods are rejected?

How to reduce the payment risk

• Do not ship without agreed terms. Sign a contract first and keep copies of everything.
• Check the buyer's record. Our tender issuer pages show what an organisation has bought, and the contract awards show contracts it has signed. A buyer that regularly awards and signs contracts is a better sign than one you cannot find any record of.
• Ask other suppliers that have worked with the buyer how and when they were paid.
• Ask your bank which payment and guarantee instruments it can offer for this kind of contract.
• If you supply a contractor, check the contractor's finances and agree payment terms such as an advance or payment before dispatch.
• Take advice from a lawyer who knows Ukrainian contract and payment rules before you sign.

General information, not legal or financial advice. Payment terms, funder rules and bank requirements differ and change. Rely on the tender documents and the contract, and take advice from qualified local advisers.