The Arbitration Court of Moscow has issued a precedent-setting ruling protecting Russian pharmaceutical manufacturers from excessive requirements in public procurement. As reported by the GKGZ portal, the court ruled that contracting authorities have no right to independently assess a drug’s “depth of localization” and analyze the origin of the pharmaceutical substance if the bidder has provided a valid ST-1 certificate.
The Core of the Dispute: Chinese Substance vs. Foreign Bid
The litigation arose from the procurement of an X-ray contrast agent (INN iohexol). Two suppliers competed in the auction:
- The first bidder offered a foreign-made drug (India);
- The second bidder entered the auction with a drug of Russian origin, providing a registration certificate and an ST-1 certificate of origin.
The state buyer was not satisfied with the Russian status of the second drug. Relying on data from the State Register of Medicines (GRLS), the buyer discovered that the pharmaceutical substance was manufactured in China. Because of this, and the lack of documents detailing the stages of the technological process, the buyer effectively equated the Russian bid to a foreign one.
Court Verdict: ST-1 is Exhaustive Evidence
The control authority recognized the buyer’s actions as a violation of contract system legislation, and the Arbitration Court of Moscow fully supported this position, clearly defining the limits of buyers’ authority:
- The ST-1 certificate is proper and sufficient proof of the country of origin for the application of national regime measures;
- When an ST-1 is provided, the bidder is not required to submit any additional documents regarding the stages of the technological process;
- The buyer has no right to reevaluate the origin of the goods based on their own investigations and other sources (including data on the active substance);
- A registration certificate containing information about the production of the finished dosage form in Russia serves as additional legitimate confirmation of the status.
The court also recalled the strict rules for applying Government Decree No. 1875: a single bid with confirmed Russian origin is sufficient to trigger import restrictions (the “second-one-out” rule). Therefore, the bid with the Indian drug was subject to unconditional rejection.
“Attempts to assess the ‘depth of localization’ through the origin of substances, components, or individual production stages effectively ignore the legal nature of the ST-1 certificate and undermine the uniform application of the national regime.”
— Dmitry Dobroshtan, Head of the Working Group under the FAS Russia Public Council
The court’s decision establishes a clear law enforcement position: the presence of a valid ST-1 certificate is an absolute basis for applying preferences. Any attempts by the buyer to demand additional confirmations are now interpreted as going beyond the law and a direct violation of Article 14 of Law No. 44-FZ.
