After publishing information and documents in the Unified Information System, the customer may discover that he “failed control under Part 5 of Art. 99 44-FZ." This means that the information contained inconsistencies with the law. What to do in this case, we will consider further.

The control under Part 5 of Art. 99 44-FZ: what does it mean

Under the control of Part 5 of Art. 99 44-FZ, which is carried out by the Federal Treasury, involves checking the compliance of information on financial support contained in procurement plans with the amounts that were previously approved and communicated to the customer. Inspectors also monitor the compliance of procurement identification codes and the amount of financial support in:

• schedules, plans;
• notices and other procurement documentation;
• contracts, their projects;
• register of contracts.

By the way, since 2018, information contained in supplier identification protocols has been excluded from inspections. In addition, the rules do not apply to information in procurement plans relating to energy service contracts (Russian Government Decree No. 1618 dated December 21, 2018).

To obtain full access to the PRO-GOSZAKAZ.RU portal, please register. It won't take more than a minute. Select a social network for quick authorization on the portal:

The control procedure under Part 5 of Art. 99 44-FZ, see Decree of the Government of the Russian Federation dated December 12, 2015 No. 1367. Let’s consider what exactly the regulatory authorities evaluate. Firstly, this is a possible excess of the volume of financial support compared to the limits communicated to the customer. The inspectors also look to see whether payments to suppliers under contracts ending in this financial year and planning period have not been exceeded. In addition, it is assessed whether the amount of the budget obligation of the recipient of money from the state treasury, which previously entered into an agreement to provide a subsidy to the municipal unitary enterprise for capital investments, was not exceeded.

Inspectors compare the NMCC in the schedule and procurement plan, in the notice and schedule. They also ensure that the final contract price does not exceed the NMCC. Inspectors pay attention to the compliance of the contract price and procurement code with those indicated in the supplier identification protocol.

Blocking control and audit of contracts: what the Treasury checks in 2019

Since 2019, treasury control of purchases takes place according to new rules. Read what's new in blocking control of planning documents and what procurement documents have become available for inspection by controllers this year.

Consequences in 2019 for the customer

The customer learns that he has not passed the control under Part 5 of Art. 99 44-FZ from the protocol of the regulatory authority. It indicates all inconsistencies and violations. They need to be eliminated and tested again. Only after receiving a mark on the compliance of the information, documents that have been the subject of verification can be placed in the Unified Information System.

The control body is given three hours from the moment of summing up the results of the inspection to send a notification to the customer. The notification comes electronically to the EIS. For serious violations in the expenditure of budget money, the customer may be punished under the Criminal Code of the Russian Federation. In particular, for misuse of funds (Article 285.1 of the Criminal Code of the Russian Federation). The violator faces a fine of up to 300 thousand rubles, forced labor of up to two years, arrest of up to six months, or imprisonment of up to two years.

How to resubmit a notification for control

On the notification change generation page, click on the “Place and send for control” button or in the context menu of the change project on the “Purchase Documents” tab, select the “Place and send for control” item. When you click on the hyperlink, in case of violations in filling out the fields, the system displays the “Result of checking for violations.” If necessary, correct the shortcomings and re-send the draft notice change for control.

The system displays a printed notice change form. Check the box to agree and click the “Sign and Post” button. If not all printed forms have been viewed, the system displays a warning message. When you click on the “Place” button, the system displays a message about sending the document for control. Click on the “OK” button, and the notification change project will move to the “Sent for control” status.

The documents that you generate in the Unified Information System will not appear in the open part of the system until the Treasury or financial authority carries out control. Make a mistake and the document will be returned for revision and then checked again. Any mistake by the customer threatens protracted control and, as a result, failure to meet procurement deadlines. Control ratios and detailed instructions for working in the Unified Information System will help prevent documents from being returned.

Consequences for the supplier

The consequences for the supplier depend on at what stage of the procurement the customer did not pass control under Part 5 of Art. 99. If this occurs during the bid period, participants will see a warning message when viewing procurement details. It is not a fact that the violations committed are serious (by the way, the supplier will not be able to find out what the problem is), but it is better not to deal with such a customer.

If it turns out that the problem is exceeding the limits, the supplier may not receive their money. Therefore, if the mark appeared during the execution of the contract, it makes sense to find out from the customer what violations were found by the inspection authorities.

Since 01/01/2017, the Federal Treasury and the bodies of the constituent entities of the Russian Federation responsible for financial audit have been carrying out control measures to verify the compliance of information on the volumes of financial support allocated to the organization for procurement activities and the data reflected in planning documents generated on the basis of the volumes communicated to the state customer financing. It is also checked that the data on procurement identification codes and the amount of funding allocated to the recipient of budget funds for procurement are the same in the following registers:

• in schedules and procurement plans;
• in the notice, in the procurement documentation and information on the positions of the schedules;
• in the protocol on determining the supplier, contractor, performer and in the procurement documentation;
• in the terms of the contract drafts, which are sent to the bidder with whom the contract is ultimately concluded, and in the protocols for determining the supplier, contractor, performer;
• in the register of contracts and in the terms of specific contracts.

Based on clause 14 of the Control Rules (approved by Government Decree No. 1367 of December 12, 2015), according to Part 5 of Art. 99 44-FZ, if the information posted by the customer has passed control according to all established conditions, then it is subject to placement in the Unified Information System within one working day from the moment the object is sent for control. The control body, in turn, puts a mark on the compliance of the sent data within 3 working days (clauses 11, 12 of the Rules).

If the information sent does not meet the established requirements, the customer will receive a protocol on the discrepancy of the information; schedule, procurement plan, notice, project documentation, etc. — information objects that are subject to mandatory control in accordance with 44-FZ (Part 15 of the Rules).

Documents will not be posted in the Unified Information System until customers correct all violations and a successful re-control procedure takes place.

Controlling authorities must form a note and indicate to the organization the identified inconsistencies, due to which the object is not subject to placement in the Unified Information System, within three working days (clauses 11, 12 of the Rules).

They will begin to operate on January 1, 2018 for organizations conducting procurement activities at the federal level. Since 01/01/2019, he has been monitoring the work of customers at the regional and local levels. It checks for compliance:

• volumes of financial support that are specified in the procurement plan, information that is approved and communicated to the customer;
• financial indicators in planning documents and monetary parameters in notices and documentation.

The department also checks the contracts that are sent to the winners with the data contained in the final protocols. In the register of contracts, controllers will look for inconsistencies with the terms of contracts.

Until the information is verified, it cannot be placed in the EIS. Therefore, carefully check everything you publish.

Where to view the non-compliance protocol on the procurement website

The responsible executive of the customer organization can find it in the register entry and in the personal account, as well as in the open part of the Unified Information System.

What to do upon receipt

If the verification of planning documents (procurement plan and schedule) is not passed and the information presented in them does not meet the requirements of Part 5 of Art. 99 44-FZ, then the customer will receive a corresponding notification about this - a protocol of discrepancies for the registry entry 44-FZ.

If violations affect the notification, the customer will also receive a protocol indicating the reasons for the non-compliance and the violations committed. The notification status in the UIS will be automatically changed to “Control failed.” Control documentation can be viewed in the notification card in the “Purchase Documents” tab.

In order to place registers of the contract system in which violations were discovered during control activities, it is necessary to eliminate all errors indicated by the controller and send documents for the re-verification procedure.

Despite the fact that if errors and violations are identified, the activity of placing information in the UIS is not suspended, the customer may be subject to administrative liability and penalties in the amount of 20,000 to 50,000 rubles (Article 15.15.10 of the Administrative Code).

Organizations acting as government customers also conduct internal audits of the quality management system. Errors and violations are detected in accordance with the requirements of GOST ISO (ISO) 9001.

Examples of filling out non-compliance protocols according to the QMS

To recognize the legality of business with foreign partners, a signed agreement (contract) is not enough. Since all foreign exchange transactions are under special control of the state, the rules for their conduct require special attention of businessmen and clear interaction with authorized banks.

Our specialists have thoroughly understood all the intricacies of innovations in currency legislation regarding the conduct of business by residents with foreign partners and have prepared a “cheat sheet” for you.

Cheat sheet of innovations in currency legislation in working with foreign economic contracts

What is important to know	Until January 1, 2018	Changes from 01/01/2018
Legislative regulation of foreign exchange transactions	Instruction of the Bank of Russia No. 138-I dated July 4, 2012. Federal Law No. 325-FZ of November 14, 2017. Code of the Russian Federation on Administrative Offenses (“Law No. 325-FZ”).	Bank of Russia Instruction No. 181-I dated August 16, 2017. Federal Law No. 325-FZ of November 14, 2017, as amended. Code of the Russian Federation on Administrative Offenses (“Law No. 325-FZ”), as amended.
Accounting for contract agreement by amount	Registration of the agreement (contract) with the bank and obtaining a transaction passport for this contract was required if the amount of obligations exceeded or corresponded to the equivalent of $50,000. If the transaction amount did not exceed $1,000, it was possible to limit oneself to providing only a certificate of currency transactions to the authorized bank. The bank had the right to refuse to issue a transaction passport if the data specified in the agreement (contract) did not correspond to the information in the completed transaction passport form.	All foreign trade contracts must be registered with an authorized bank! The focus of the contract on import or export is important, because the accounting procedure for contracts is different depending on the direction. According to clause 4.2 of Instruction No. 181, accounting for contracts is REQUIRED if the contract amount in rubles is: If the amount of obligations under the agreement/contract is less than 200,000 rubles, the provision of documents related to currency transactions is not required. The amount of obligations is taken into account for: For resident-exporters, a simplified procedure for registering foreign trade contracts has been established, namely up to 1 business day.
Registration of the agreement/contract with an authorized bank and execution of a transaction passport		Instead of transaction passports, export contracts are kept in the bank. All transaction passports that are not closed and are in the currency control file before 01/01/2018 will be considered closed. Moreover, banks will not provide any notes about this; in turn, the number of such transaction passports automatically becomes the unique number of the contract (or loan agreement) registered by the bank. To register a contract, you must submit to the authorized bank: After which the authorized bank must: The bank does not have the right to refuse to register the agreement/contract!
Providing certificates of currency transactions (CVO) both when currency is received into a current account and when currency is written off from a resident’s current account	There was an obligation to provide a certificate of foreign exchange transactions to an authorized bank. Moreover, Instruction No. 138-I provided for different deadlines for providing SVO depending on the type of operation being performed: in most cases within 15 working days from the date of transactions.	The requirement to provide a certificate of foreign exchange transactions has been cancelled. But the requirement to provide documents to confirm foreign exchange transactions within a period of no later than 15 working days after the date of crediting foreign currency to the resident’s transit account specified in the notification of the authorized bank has been retained.
Providing a certificate of supporting documents for currency control (SPD)	There was an obligation to provide a sealed and signed SPD to an authorized bank in case of fulfillment of obligations under a foreign economic contract (supply of goods) no later than 15 working days after the expiration of the month in which:	According to instruction 181-I, from March 1, 2018, the certificate of supporting documents (SPD) has become a unified form of accounting and reporting for residents on foreign exchange transactions. Its new form is contained in Appendix 6 in Instruction 181-I.
Other requirements: a) provision of a currency control statement; b) passing exchange control	In a number of cases, such as the transfer of a resident's contract to another bank, there was an obligation to provide a foreign exchange control statement to the authorized bank.	If a resident transfers a contract to another bank, there is no need to submit a currency control statement to the authorized bank. The bank independently requests a currency control statement from the Bank of Russia.
Bank refusal to conduct a foreign exchange transaction	The version of the law “On Currency Regulation and Currency Control” allowed residents to indicate in agreements (contracts) the expected deadlines for the fulfillment of obligations by a non-resident. The bank’s refusal to conduct a foreign exchange transaction was lawful in the following cases:	From May 14, 2018, new requirements of the Law “On Currency Regulation and Currency Control” will apply, which obliges the resident to indicate clear deadlines for the fulfillment of obligations by the parties. Their absence in the agreement/contract may result in the bank refusing to carry out currency transactions under it. Moreover, in accordance with Art. 168 of the Civil Code, a contract transaction without clear deadlines for fulfilling obligations may be considered illegal! Banks' refusal to conduct a foreign exchange transaction will be legal if the resident has provided the bank with documents that do not comply with the requirements of the law (violations of foreign exchange legislation).

Legislative regulation of foreign exchange transactions.

1. Instruction of the Bank of Russia No. 138-I dated July 4, 2012. 2. Federal Law No. 325-FZ of November 14, 2017. 3. Code of the Russian Federation on Administrative Offenses (“Law No. 325-FZ”).

Changes from 01/01/2018

1. Instruction of the Bank of Russia No. 181-I dated August 16, 2017. 2. Federal Law No. 325-FZ of November 14, 2017, as amended. 3. Code of the Russian Federation on Administrative Offenses (“Law No. 325-FZ”), as amended.

Accounting for contract agreement by amount.

Registration of the agreement (contract) with the bank and obtaining a transaction passport for this contract was required if the amount of obligations exceeded or corresponded to the equivalent of $50,000. If the transaction amount did not exceed $1,000, it was possible to limit oneself to providing only a certificate of currency transactions to the authorized bank. The bank had the right to refuse to issue a transaction passport if the data specified in the agreement (contract) did not correspond to the information in the completed transaction passport form.

Changes from 01/01/2018

All foreign trade contracts must be registered with an authorized bank! The focus of the contract on import or export is important, because the accounting procedure for contracts is different depending on the direction. According to clause 4.2 of Instruction No. 181, accounting for contracts is REQUIRED if the contract amount in rubles is:

• 3 million rubles under import and loan agreements;
• 6 million rubles under export contracts

If the amount of obligations under the agreement/contract is less than 200,000 rubles, the provision of documents related to currency transactions is not required.

The amount of liabilities is taken into account:

• date of execution of the agreement/contract
• date of conclusion of changes in the amount of the agreement/contract.

For resident exporters, a simplified procedure has been established for registering foreign trade contracts, namely up to 1 business day.

Registration of the agreement/contract with an authorized bank and execution of a transaction passport.

Changes from 01/01/2018

Instead of transaction passports, export contracts are kept in the bank. All transaction passports that are not closed and are in the currency control file before 01/01/2018 will be considered closed. Moreover, banks will not provide any notes about this; in turn, the number of such transaction passports automatically becomes the unique number of the contract (or loan agreement) registered by the bank. To register a contract, you must submit to the authorized bank:

• general information about the export contract (date of drawing up and date of fulfillment (completion) of obligations, number, type of contract, name of currency and data on the amount of obligations stipulated by the contract);
• details of all non-residents who are parties to the export contract (name, country).

After which the authorized bank must:

• register the contract by assigning it a unique number;
• create a bank control statement under the contract.

The bank does not have the right to refuse to register an agreement/contract!

Providing certificates of foreign exchange transactions (CVO) both when currency is received into a current account and when currency is written off from a resident’s current account.

There was an obligation to provide a certificate of foreign exchange transactions to an authorized bank. Moreover, Instruction No. 138-I provided for different deadlines for providing SVO depending on the type of operation being performed:

In most cases, within 15 business days from the date of transaction.

Changes from 01/01/2018

The requirement to provide a certificate of foreign exchange transactions has been cancelled. But the requirement to provide documents to confirm foreign exchange transactions within a period of no later than 15 working days after the date of crediting foreign currency to the resident’s transit account specified in the notification of the authorized bank has been retained.

Providing a certificate of supporting documents for currency control (SPD

There was an obligation to provide a sealed and signed SPD to an authorized bank in case of fulfillment of obligations under a foreign economic contract (supply of goods) no later than 15 working days after the expiration of the month in which:

• the goods have passed customs control. As confirmation, the customs authority has placed a stamp in the declaration of goods with a note indicating the date of release of the goods;
• other supporting documents were prepared.

Changes from 01/01/2018

According to instruction 181-I, from March 1, 2018, the certificate of supporting documents (SPD) has become a unified form of accounting and reporting for residents on foreign exchange transactions. Its new form is contained in Appendix 6 to instruction 181-I.

Other requirements: a) provision of a currency control statement; b) passing exchange control.

In a number of cases, such as the transfer of a resident's contract to another bank, there was an obligation to provide a foreign exchange control statement to the authorized bank.

Changes from 01/01/2018

If a resident transfers a contract to another bank, there is no need to submit a currency control statement to the authorized bank. The bank independently requests a currency control statement from the Bank of Russia.

Refusal of the bank to conduct a foreign exchange transaction.

The version of the law “On Currency Regulation and Currency Control” allowed residents to indicate in agreements (contracts) the expected deadlines for the fulfillment of obligations by a non-resident. The bank’s refusal to conduct a foreign exchange transaction was lawful in the following cases:

• failure to provide documents or provision of incorrect documents;
• if the bank suspects the illegality of receiving funds or financial terrorism.

Changes from 01/01/2018

From May 14, 2018, new requirements of the Law “On Currency Regulation and Currency Control” will apply, which obliges the resident to indicate clear deadlines for the fulfillment of obligations by the parties. Their absence in the agreement/contract may result in the bank refusing to carry out currency transactions under it. Moreover, in accordance with Art. 168 of the Civil Code, a contract transaction without clear deadlines for fulfilling obligations may be considered illegal! Banks' refusal to conduct a foreign exchange transaction will be legal if the resident has provided the bank with documents that do not comply with the requirements of the law (violations of foreign exchange legislation).

Consequences of changes in currency legislation

From 01/01/2018, Russian companies that do business with foreign partners, when signing an agreement/contract, will have to make sure each time that the parties have clearly agreed upon and set out in the agreement/contract the terms for the fulfillment of their obligations. And often Russian businessmen will have to convince their foreign client that this is required by domestic legislation. Moreover, it will be necessary to clearly and timely pass currency control at an authorized bank by submitting the necessary package of documents for a transaction with a foreign client. Otherwise, such transactions may be considered illegal, and the resident risks facing fines.

Fines for violations of currency laws in 2018

Fines for non-compliance with the rules of currency transactions (including for delays) and other penalties are specified in Article 15 of the Code of Administrative Offenses of the Russian Federation, which provides not only fines for residents (legal entities) for failure to comply with deadlines for submitting documents for currency control, but also for their incorrect storage and design. For example for:

• untimely reporting on currency movements;
• failure to close the transaction passport(s);
• failure to provide supporting documents or information about the authenticity of the transaction.

The amounts of fines range from 40,000 rubles to 1 million rubles for organizations and from 1,000 to 15,000 rubles for officials. As you can see, changes in currency control legislation in 2018 require special attention and scrupulousness. Contact our specialists for advice, they will help you avoid fines due to ignorance of innovations.