Analysis of the possible and actual use of factoring in the public procurement system

The assignment of monetary claims in Russia is developing rapidly, as it allows business entities to transform accounts receivable into monetary assets. Along with this, there is a high activity of business entities in the public procurement sector. There is no consensus or understanding among experts in public procurement and public finance on the possibility of using assignment of monetary claims in the contract system, since public procurement carried out by government agencies and budget organizations within the framework of the law on the contract system is not regulated exclusively by the Civil Code, as factoring, but by a multitude of regulatory legal acts, including: Budget the Code of the Russian Federation, the Federal Law on the Contract System in the Field of Procurement of Goods, Works, and Services for State and Municipal Needs, the Code of Administrative Offenses of the Russian Federation, and others. In addition, the Budget Code does not provide for the procedure for authorizing payments under a government contract to a non-contractor. However, the above-mentioned regulatory documents do not prohibit the assignment of monetary claims from the supplier of a government contract to another person. In practice, when trying to apply factoring in the contract system, despite the refusal of the financial control authorities to make such a payment, despite the decisions of the courts on the impossibility of such an assignment, the Supreme Court decided that there were no obstacles to the application of factoring under this contract. After that, there were more questions about the possibility of using factoring in the contract system, as certain changes were made to the legislation. However, public procurement is not limited solely to the contract system. Therefore, this article analyzes the use of factoring in the contract system and the public procurement system by certain types of legal entities.