Information current as of 8 August 2025

– In July, the DOT announced 90 tenders (121 lots) totalling UAH 6.05 billion. Meanwhile, 86 contracts worth UAH 6.44 billion were concluded, with over 75% of funds allocated to food procurement.

– Among 10 food contracts, 2 had to be signed at prices higher than the lowest bids in the tenders. This occurred as a result of two unrelated court decisions that ruled the cheapest proposals non-compliant with tender requirements. Ultimately, these contracts were concluded at a combined UAH 22.53 million more than the proposals the DOT had recognised as winning bids.

– The DOT terminated a food contract concluded in June with GRANPRI LTD LLC worth UAH 3.37 billion due to violations of anti-corruption clauses. The company features in criminal proceedings regarding the embezzlement of budget funds totalling UAH 535.7 million within previous DOT contracts. A contract with ASICS GROUP LLC worth UAH 948,900 was also terminated, as funds had been improperly credited to this company’s account.

– Following a series of unsuccessful uniform procurements, the DOT purchased 75,000 winter jackets, but once again failed to contract winter trousers.

– At the end of July, due to urgent need, the agency began procurements of certain uniform items with the new MM-25 camouflage pattern, which was only approved on 11 June. Apart from several companies, most market participants were unprepared to participate in the tenders.

– For the first time in the past 8 months, the DOT signed a record low number of fuel contracts – only approximately UAH 2 million worth of diesel and petrol was contracted, exclusively through voucher systems.

StateWatch analysts examined July’s procurement activities available on Prozorro and proposed recommendations for process improvements.

In total, during July, the State Logistics Operator announced 90 tenders (121 lots) with an expected value of UAH 6.05 billion. The majority of purchases (UAH 6.05 billion) were conducted under simplified procedures. Throughout the month, 74 companies participated in the tenders, whilst the average number of bids per tender stood at 2.52.

In July, the agency concluded 86 contracts totalling UAH 6.44 billion – based on tender results announced both in July and previously. The DOT spent over UAH 4.86 billion (75.48%) of contracted funds on food sets, according to the Catalogue and dry rations. Expenditure on material equipment amounted to UAH 1.28 billion (19.92%), whilst disposable tableware cost UAH 265.45 million. A record low amount was spent on petroleum, oil and lubricants compared to previous months – UAH 9.38 million.

Food Procurement

In July, the DOT concluded 10 contracts for the supply of food for military personnel totalling UAH 4.86 billion, whilst managing to achieve savings of UAH 1.04 billion.

The main portion of contracted funds (UAH 4.51 billion) comprised 3 contracts for the supply of 35.82 million food sets according to the Catalogue for personnel and 7,040 sets for animals, to be delivered by the end of 2025. The largest volumes were awarded to BUSK CANNING FACTORY – 25.02 million sets worth UAH 3.12 billion (UAH 124.68 per set).

Two other contracts were concluded following court decisions. Specifically, TRADE GRANITE INVEST LLC challenged the tender results, where OKHTYRKA MEAT PRODUCTS LLC had initially been determined as the winner. However, the court ruled its proposal invalid on the grounds that the company had failed to disclose warehouse addresses and provide an operational permit for one of its warehouse facilities in Kyiv Oblast. OKHTYRKA MEAT PRODUCT LLC, together with the agency, attempted to overturn the first instance decision, but the appellate court rejected the claim.

The next economically advantageous proposal belonged to the MITFORM company. However, TRADE GRANITE INVEST LLC successfully challenged this victory in court. The grounds were that the second winner had failed to provide handover certificates for leased lorries, operational permits for warehouses, and had submitted false information from the state register of legal entities. The first instance court granted the claim, and the decision was upheld on appeal. As a result, the DOT signed a contract worth UAH 326.73 million (UAH 136.14 per set) with TRADE GRANITE INVEST LLC, whose proposal exceeded OKHTYRKA MEAT PRODUCT LLC’s by UAH 22.04 million.

A similar situation arose in the tender for the supply of 8.39 million food sets, regarding which MEAT PROM LLC twice successfully challenged the recognition of REGION-PRODUCT LLC as the winner. Initially, in June 2025, the first instance court overturned the company’s victory due to non-compliance of technical documentation and violations of food safety standards, among other issues. The appellate court, in turn, upheld this decision.

Despite this, the agency repeatedly proposed that REGION-PRODUCT remedy the non-compliance issues and again recognised it as the winner. Following further defeats in the first and second instances, the DOT signed a contract with MEAT PROM LLC worth UAH 1.07 billion (UAH 127.44 per set). The difference between REGION-PRODUCT’s and MEAT PROM’s proposals amounts to UAH 504,000.

In addition, the agency concluded 6 contracts for the procurement of 718,396 daily dry rations worth a total of UAH 243.34 million, and signed a contract with Taras Shevchenko National University of Kyiv for the provision of 841,500 catering services worth UAH 100.40 million (UAH 119.31 per service).

Overall, contracts in the food category were concluded with seven companies in July. BUSK CANNING FACTORY LLC received the largest contract value.

Material Equipment

Following several months of unsuccessful tenders, 60 material equipment contracts worth UAH 1.28 billion were concluded. Total savings from procurement results amounted to UAH 9.18 million.

The largest contract value went to TOP-TEX LLC for supplying 20,000 headsets (Type 1-2) worth UAH 317.80 million (UAH 15,890 per unit).

After unsuccessful attempts to procure material equipment during April-June, particularly winter uniforms, the DOT increased the expected cost for winter wind- and waterproof jackets compared to April’s figure – from UAH 2,889.96 to UAH 3,069 per unit. This enabled the conclusion of seven contracts worth over UAH 229.86 million. Agreements were signed with seven different companies, with the largest value going to TUSMO LLC, which will supply 20,000 jackets for UAH 61.26 million (UAH 3,063 per unit). One contract went to a new supplier – ISTOK TRADE LLC – contracted for 10,000 jackets.

In July, the DOT also managed to procure 160,000 short-sleeved T-shirts worth UAH 26.7 million (UAH 166.9 per unit) and 200,000 polo shirts worth UAH 97.46 million (UAH 487.3 per unit). The expected cost for T-shirts in July was set at UAH 169.43, representing a 13.1% increase from April’s figure (UAH 149.8). The situation with polo shirt procurements was more telling – compared to April, the expected cost per unit in July rose by 28.2% (UAH 487.3), which finally enabled contract conclusion.

Additionally, the agency contracted 20,000 helmets from TEMP-3000 LLC worth UAH 163.20 million (UAH 8,160 per unit). At the same time, the DOT also procured 350,000 units of adaptive clothing to supply “Wounded Warrior Packages” for a total amount of UAH 128.94 million.

During June-July, a significant portion of suppliers returned to material equipment tenders, enabling contracts with 27 companies. TOP-TEX LLC received the largest contract value.

Petroleum, Oil and Lubricants

In July, the agency concluded 5 contracts for the supply of petroleum, oil and lubricants totalling UAH 9.37 million and managed to achieve savings of UAH 1.60 million. However, over the past six months, contracts in this category had been signed monthly for over UAH 1 billion. It should be noted that lots with large volumes in this category were not announced in June, meaning significant contracts were not concluded during July. For the first time in the past eight months, the DOT did not sign a single contract with UKRNAFTA PJSC, which remains the primary supplier of diesel fuel and petrol.

Meanwhile, the Ministry of Defence reported that based on first-half results, the DOT fulfilled over 82% of requirements under the petroleum, oil and lubricants programme. At the same time, the DOT initiated new large-scale POL procurements in July and August.

The largest share of POL contract value consists of OZh-40 coolant fluid and Tosol antifreeze. Specifically, an agreement was signed with IMEX CHEMGROUP PE for supplying 100 tonnes of OZh-40 coolant fluid worth over UAH 2.89 million, and with NF AGRO LLC for 100 tonnes of Tosol antifreeze fluid for UAH 2.85 million.

The agency also purchased 45,000 litres of A-95 petrol vouchers from PETROL PARTNER LLC for UAH 1.88 million and 2,200 litres of diesel from OKKO-SERVICE PE for UAH 122,100. Separately, TRIOTECH LLC was contracted for 5 tonnes of automatic transmission fluid worth UAH 1.62 million.

In July, the DOT signed petroleum, oil and lubricants supply contracts with five companies. IMEX CHEMGROUP PE received the largest contract value.

Challenges in July Procurements 

Unsuccessful Tenders

In July, 39 tenders (54 lots) totalling UAH 838.31 million could not be completed. The highest number of failed procedures occurred in the material equipment category, with 26 tenders cancelled at an expected value of UAH 404.07 million.

The main reason for failures remains the absence of bids under simplified procedures. Due to lack of participants, the agency was unable to procure 439,992 enhanced daily dry rations (menus 1-14) at an expected value of UAH 202.61 million (UAH 460.5/460.51 per unit), 2,500 tonnes of jet fuel worth UAH 123.92 million, and 1,500 tonnes of A-92 petrol for UAH 96.28 million.

Following the reduction in expected costs for various textile products in April and May, suppliers continue to refuse participation in tenders for winter wind- and waterproof trousers. Despite increasing the expected cost (from UAH 1,725 to UAH 2,023.84/2,040.5 per unit), the agency was unable to procure 95,000 trousers at a total expected value of over UAH 193.01 million.

Tenders also failed for purchasing 40,000 sets of mid-season underwear worth UAH 15.40 million (UAH 385.08 per unit) and 500,000 men’s briefs for UAH 52.99 million (UAH 105.99 per unit).

New MM-25 Multicam

The procurements of certain uniform elements totalling UAH 142.66 million with the new MM-25 (Multicam) camouflage pattern deserve particular attention. At the end of May, following completion of research trials, the Commander-in-Chief of the AFU recommended changes to technical specifications due to superior camouflage properties of MM-25 compared to the current MM-14 (pixel) pattern. In June, the new specification was approved by the Central Directorate for Material Support Development. The process occurred within a compressed timeframe (54 days) – the technical specification was approved on 11 June, and by 24 July the DOT had already announced tenders for various products with delivery scheduled by the end of September.

In response to StateWatch’s inquiry, the DOT explained that the basis was an appeal from the Logistics Forces Command dated 7 July 2025 regarding urgent need for uniforms with the new MM-25 pattern for military personnel directly participating in combat operations at the front line. The DOT also emphasised that no requirement for minimum timeframes between technical specification approval and tender announcement publication has been established by Ministry of Defence decision.

The Ministry of Defence noted that it planned to procure trial batches of various material equipment items using the new fabric, totalling 73,000 units at an expected value of UAH 142.66 million – combat shirts, special suits (summer and winter), summer field caps and summer field suit trousers.

However, most procedures received no bids whatsoever. Of 15 lots, only four worth UAH 74.04 million could be completed.

The situation was further complicated by the fact that most manufacturers already held significant warehouse stocks of products in the current MM-14 (pixel) pattern and were unprepared to rapidly reorient production. This was compounded by short delivery timelines, which effectively narrowed the circle of potential participants to several companies capable of promptly securing new fabric and manufacturing.

Four companies participated in the tenders, whilst GRIN MODA LLC was disqualified due to a compliance certificate issued for an incorrect fabric type. The tender winners were:

– MIK LLC for supplying 15,000 winter suits for UAH 64.81 million

– OLTEKS LLC for supplying 4,000 summer suit trousers for UAH 4.36 million and 4,000 shirts for UAH 3.84 million

– PRYLUTSKA GARMENT FACTORY LLC for supplying 4,000 summer caps for UAH 1.04 million

PRYLUTSKA GARMENT FACTORY LLC and OLTEKS LLC belong to the same OLTEKS group, with Anna Oharenko as the key person who owns both companies. Meanwhile, MIK LLC features in an SBU criminal proceeding regarding the supply of substandard material equipment for military personnel at inflated prices.

Court Cases

A particular challenge for the DOT was court appeals against tender results. In two large contracts for supplying food sets according to the Catalogue, winners were determined only after court decisions, as described in detail in the food procurement section. Due to tender documentation non-compliance, claimants successfully challenged DOT decisions, indicating deficiencies in winner verification procedures.

It should be noted separately that in July the agency terminated its June contract with GRANPRI LTD LLC worth UAH 3.37 billion. The grounds were the supplier’s violations of anti-corruption conditions and failure to fulfil obligations regarding notification of suspicions involving affiliated persons.

According to criminal proceedings data, officials from GRANPRI LTD LLC and ASICS GROUP LLC, together with the head of food services at the Naval Institute of Odessa Maritime Academy, participated in a large-scale scheme to embezzle funds from food supplies. Specifically, it states that the listed individuals misappropriated budget funds totalling UAH 535,682.43. After receiving contracts, the companies created goods acceptance documents listing products that were not actually supplied, or recorded inflated delivery volumes.

In July, the agency also terminated its contract with ASICS GROUP LLC worth UAH 948,900. This contract features in the criminal proceedings, with funds totalling UAH 535,682.43 improperly credited to this company’s account, though these payments are not reflected on Prozorro.

Recommendations 

For the DOT:

1. Strengthen procedures for verifying participants’ tender documents.

2. Create a formal request to law enforcement agencies for information regarding criminal proceedings involving DOT suppliers.

For the Ministry of Defence:

1. Adopt a decision establishing a minimum 6-month period between introducing new technical specifications and announcing procurements.

2. Provide advance notice to all potential suppliers about initiatives and subsequent approval of new technical conditions for material equipment.

DOT procurement monitoring has been supported by the Office of the United Kingdom’s Special Defence Advisor and delivered by EDGE Foundation and StateWatch Think Tank.