Transparency or a screen: how ARMA transfers assets into management

The head of the Asset Recovery and Management Agency, Olena Duma, constantly emphasizes the need to fill the state budget from the transfer of assets for management or sale. However, despite the loud statements, the actual results of ARMA's work differ from those stated: questionable procedures for selecting managers, low transparency and unclear decisions may indicate serious systemic problems, UNN writes.

Details

The main function of ARMA is to organize the implementation of measures related to the valuation, accounting and management of assets. The latter is envisaged by transferring the assets to a manager selected through a tender on the Prozorro platform. There is also an option that the Cabinet of Ministers may appoint the manager, but this is only for a small number of assets from a special list.

According to the information available on the official website of the ARMA, during Olena Duma's term of office, no asset management agreement was concluded with a legal entity or individual entrepreneur selected through a competitive selection of a manager conducted on Prozorro.

At the same time, the analysis of procurement of management services on Prozorro shows that the Agency has entered into as many as seven asset management contracts since October 27, 2023 (the date of the first tender for the manager under the leadership of the Duma), and has not even published this information on the official website in the section "Asset Managers". I wonder why? Perhaps they are ashamed of the tremendous success of the management under these seven contracts.

The assets transferred for management under the agreements include the EMMAKRIS III bulk carrier, 434 railway cars, non-residential premises in Kyiv, three real estate properties in Lviv, and corporate rights to the Ovruch crushed stone plant.

The transfer of 100% of the corporate rights and assets of the Ovruch crushed stone plant deserves special attention. The declared value of this property exceeds UAH 340 million, but the guaranteed payment from the manager is only UAH 47,753 per month. The manager is Tamerlan-1 LLC, which has an authorized capital of only UAH 1,300.

The analysis of the tender documents raises serious questions:

●     No requirements for experience in managing similar assets - 100% of corporate rights and real and personal property totaling 355 units were transferred to the management, including very specific equipment, namely mining dump trucks, bulldozers, mining loaders, specific mining equipment and much more. In accordance with the requirements of the current legislation, operation of such equipment requires special skills and permits individually for each employee, meaning that not everyone is authorized to operate a mining dump truck. Instead, the tender documentation does not require that the bidder have any experience with such equipment.

●     Minimum staffing requirements - only three employees are required, one of whom must have a technical background.

●     Lack of material and technical base for working with quarry equipment.

According to Opendatabot , in 2023, Tamerlan-1 LLC had only one employee, all other employees were hired during the tender. The company also changed its manager during the tender. In addition, on the day of the tender announcement, the company had a KVED related to the installation of water supply systems, but later changed it to quarrying. This allowed the company to formally meet the tender requirements, although it had no actual experience in mining.

One of the most important components of ARMA's work is the Prozorro platform, which is designed to ensure openness and fairness in the selection of managers. However, the described cases show that the system works as a screen for potential fraud. Thus, UNN's own sources revealed that at least three procurements did not have acceptance certificates signed, which makes it difficult to monitor the fulfillment of the terms and conditions.

ARMA has a key role in preserving seized property, but the lack of transparency in the agency's activities damages both its reputation and the state budget.

Earlier, UNN analyzed three high-profile ARMA procurements that raise a lot of questions. Read more at link.