Annar Ltd., a company owned by Arshavir Khachatryan, who heads the urban construction department at the Kotayk Government, has won several state building contracts in the province.
One contract is to map and build an irrigation pipeline in the community of Jrvezh and to install a potable water pipe in the community of Aramous.
Tenders for the August contracts were never announced in advance and the company got the work via competitive negotiations with the Kotayk authorities.
Another company, Marmar-Etoual Ltd., also entered into negotiations for the work. Its price for the Jrvezh job was 99,800 drams more than the Annar offer and 189,800 drams more for the Aramous job.
As a result, the Kotayk Government signed a 14.5 million contract (Jrvezh) and a 9.5 million one (Aramous) with Annar Ltd.
Marmar-Etoual is solely owned by Liana Hounanyan, wife of Komitas Hounanyan, the head of the Kotayk Government’s Internal Audit Division.
Marmar-Etoual, not to be deprived its share of regional government business, won a contract to refurbish the water distribution system in the Kotayk community of Aghavnadzor.
It would appear that the two companies, both owned by employees at the Kotayk Government, have agreed to share the construction contracts.
The Kotayk Government notes Article 20, Part 5 of the “Law on Procurement” to justify its procurement procedure. It states, “The goods, works or services to be procured can be purchased only from one source, due to copyright and adjacent rights, or in the case of specific or exceptional rights.”
State agencies often refer to this clause to have companies owned by friends and acquaintances declared winners of state contracts, without verifying what those rights of the winning company are.