The Georgian Parliament has initiated amendments to the Law on Public Procurement that would significantly revise procurement procedures, introduce new tools, and tighten oversight mechanisms across the system.
The draft law introduces two new instruments into public procurement – a framework agreement and an electronic catalog – which are expected to reduce administrative and financial costs for both procuring organisations and businesses.
The reform also places strong emphasis on small and medium-sized enterprises through the formalisation of subcontractor participation. The draft defines rules for subcontractor selection, responsibility sharing, and control mechanisms, aiming to increase SME involvement in state procurement.
“The goal of the reform is to make the procurement process more flexible, transparent and competitive, as well as to ensure more efficient use of state resources,” the explanatory note reads.
Expanded “black list” rules
The amendments strengthen the so-called “black list” mechanism, extending the period of registration for dishonest economic operators from one year to two years.
The list will also be expanded to include related companies and persons connected to blacklisted individuals, restricting their participation in public procurement and contract signing.
Disqualification for serious crimes
The draft law introduces stricter rules for disqualification in cases involving serious offences, including corruption, fraud, money laundering, terrorism and other crimes against the state.
Procuring organisations will be able to exclude such bidders from high-value public procurement procedures above defined thresholds.
Exceptions to standard procedures
The reform expands cases in which simplified procurement procedures can be used, including situations where competition is not feasible, such as obtaining international accreditation, membership in international organisations, or exclusive services from foreign state bodies.
In such cases, authorities say standard tenders create delays and increase administrative costs.
Social procurement and indexation
The draft also introduces a procurement reservation mechanism aimed at supporting the participation of persons with disabilities and other vulnerable groups. Certain contracts may be reserved for companies meeting specific criteria defined by the government.
It also regulates price indexation in long-term contracts, allowing adjustments based on inflation and market changes under rules set by the Government of Georgia.
Security sector changes
The amendments expand simplified procurement rights for representatives of the Defence Ministry, Interior Ministry, State Security Service system, Prosecutor’s Office, and defence attachés abroad, allowing purchases of up to 50,000 GEL under simplified procedures.
The definition of the State Security Service is also revised to the “Georgian State Security Service System,” expanding its institutional scope and procurement flexibility.
Implementation timeline
The draft law foresees phased implementation. Provisions on the “black list,” framework agreement and electronic catalog are set to enter into force from January 1, 2027, while subcontractor regulations will apply from September 1, 2026. Price indexation rules are expected to take effect from June 1, 2026.
The bill is being considered in an expedited manner, with initiators citing the need to improve efficiency in public procurement and strengthen anti-corruption mechanisms.
