Single Source Procurements: Taxpayers Assist Business Interests of Former Minister of Health’s Sons
The state budget has become the main source for government officials and their relatives to develop their businesses. Oftentimes, companies that win state procurement tenders are linked, in one way or another, to various government officials.
63 million AMD contract goes to company owned by son of former Armenian health minister
Bianco Dental Clinic, the company owned by Hrant Dumanyan, son of former Armenian Minister of Health Derenik Dumanyan was awarded the contract based on the following stipulation of the “Law on Procurements”:
Article 23. Conditions for use of single-source procurement
- Procurement can be single-source, if: a) the goods, works or services to be procured can be purchased only from one source, due to copyright and adjacent rights, lack of competition or license. b) Owing to an emergency or contingency, there is an urgent need for procurement and, in terms of time, it is impossible to use another form of procurement, provided, this need was impossible to predict as well as, if the procurement item is not covered in signed periodic procurement contracts.
Bianco was founded in May 2011 and is solely owned by Hrant Dumanyan. The clinic’s director is Kamsar Kostanyan, a relative of Derenik Dumanyan’s wife Anahit. Artour Dumanyan, another son of Derenik Dumanyan who currently serves as an assistant to the head of personnel of the Ministry of Health’s Food Safety Service, is also affiliated with Bianco.
The 2011 single source procurements made by the Ministry Of Health are missing from the government’s e-gov.am website. There is data for only three single source procurement contracts that the ministry made in 2012.
On February 8, 2013, the Ministry of Health and Bianco signed two contracts with Bianco – one for 3.176 million AMD and another for 17 million. Both were for out of hospital services. On February 18, 2014, two contracts totaling 21.7 million AMD were signed for the same services.
Contracts were signed with Bianco both when Derenik Dumanyan served as minister and afterwards.
On February 2 of this year two single source contracts totaling 21 million AMD were signed with Bianco. Thus, from 2013 – 2015 the government signed six contracts totaling 63 million AMD with Bianco Ltd.
Gurgen Dumanyan’s animal and pharmacy businesses
Gurgen Dumanyan, the eldest son of Derenik Dumanyan, currently serves as the first deputy to Davit Harutyunyan, the Armenian government’s chief of staff. Gurgen Dumanyan owns 10% in the Fauna Zoological Garden established in 2005. The other 70% is owned by Artour Khachatryan, a person involved in Armenia’s trade of endangered animals that Hetq has extensively covered.
As stated in its charter, Fauna is engaged in the retail trade of mainly foodstuffs, beverages and tobacco products in non-specialized stores.
Gurgen Dumanyan, a former director of the Ministry of Health’s “Health Programs Implementation Office”, also owns shares in a number of companies temporarily not operating.
The tourism sector
Derenik Dumanyan’s family also has its fingers in the tourism sector. Prior to 2012, his wife Anahit owned 25% in Yan Voyage. This company signed an air services contract with the Procurement Assistance Center SNCO in October 2013.
The company was founded in 2010 and operates as a tour operator in addition to offering real estate purchasing services in Armenia and overseas.