How are flowers sold at auctions? - This question is one of the most interesting in the flower business. Let's get to know him better using the example of FloraHolland.
Dutch company Flora Holland is the largest flower auction in the world. According to the form of its organization, it is a cooperative business, the company is the property of its members.
FloraHolland was formed as a result of a series of successive mergers of the Dutch flower exchanges. The last, on 1 January 2008, FloraHolland was joined by the largest Dutch Aalsmeer flower auction (Bloemenveiling Aalsmeer). FloraHolland currently controls over 90% of the Dutch cut flower market. The firm conducts its business both in Holland and abroad. The company's annual turnover is over 4 billion euros. In 2015, the company's turnover amounted to €4.5 billion.
In 2016, the company rebranded and now officially bears the name Royal Flora Holland.
Royal FloraHolland has 6 auction centers. In the cities of Aalsmeer ( Aalsmeer), Naldwijk ( Naaldwijk) and Rijnsburg ( Rijnsburg) export flower auctions are located, and in the cities of Blaiswijk ( Bliswijk), Venlo ( Venlo) and Elde ( Eelde) are regional flower auctions. Bidding at FloraHolland auctions takes place 5 days a week. The company has 13 auction rooms, 42 auction hours, 270 thousand auction carts, 200 million containers (containers, packages, baskets, boxes, etc.) for flowers.
Every day, 120 thousand transactions are made at Royal FloraHolland flower auctions. The auction features 20,000 different flowers and plants. FloraHolland sells 12 billion flowers and plants a year. The company carries out 60% of world exports of flowers and plants.
Royal FloraHolland imports flowers from 60 countries. The main flower importers for FloraHolland auctions are Holland, Kenya, Israel, Ecuador, Zambia and Germany.
More than 80% of the flowers sold at auctions are exported. Royal FloraHolland exports flowers to 140 countries around the world. The most important flower export destinations for FloraHolland are Germany, Great Britain, France, Belgium, Italy and of course Russia. Flowers from this auction are delivered even to countries as far from Holland as Japan, Australia, Singapore.
Royal FloraHolland has 5,200 members, 9,000 suppliers from all over the world, and 3,500 customers. The company employs 4.5 thousand people. In addition, the Dutch flower business directly or indirectly employs over 250,000 people worldwide.
All premises of the Royal FloraHolland company cover an area of 2,600,000 m 2 , which is about 400 football fields.
Royal FloraHolland is headquartered in Aalsmeer. Here is the world's largest flower auction Bloemenveiling Aalsmeer. The one-story building of the auction has a huge area of 990 thousand square meters. meters. This is one of the largest buildings in the world. The auction building ranks 4th in the list of the largest buildings in the world, ahead of Beijing International Airport and the Pentagon building in Washington.
Around 20 million cut flowers are sold daily at the Aalsmeer flower auction. On special days, such as Valentine's Day and Mother's Day, sales increase by 10%.
The interior of the Aalsmeer Flower Auction. Refrigerators in which flowers are stored.
Dozens of containers of cut flowers are constantly moving in circles to get into the halls where the auctions are held.
Historically, wholesale buyers of flowers have to come to the auction in person to make deals. Traders can buy flowers either in the morning during the auction at prices that are determined during the auction, or in the following hours at fixed prices from direct sales agencies.
Dutch flower auctions are organized on the principle of price reduction. Bidding starts from the maximum price, the price gradually decreases. During a price cut, wholesale flower buyers must press a special button on their desk. Whoever pressed the button first gets this batch of flowers at the price he chose.
A classic example of how the Aalsmeer Flower Auction works. Traders sit in a large hall, amphitheatrically located at tables equipped with special buttons. In front of them, batches of flowers (lots) leave on the conveyor. There is a large auction clock on the wall, along which the arrow moves from the maximum price to the minimum. Those wishing to purchase this lot must press the button as the arrow moves. The decision must be made quickly in a few seconds. The task is not simple. You should not buy at an inflated price, and you need to anticipate what price competitors may offer.
The purchase is made right there, through a computer within 10-15 minutes. Traders receive their flowers within an hour. According to the internal transport system of the auction, the flowers are delivered to the warehouses. At the request of buyers, bouquets can be made from them here. The purchased flowers are then immediately delivered to the refrigerators at their destination - shops or the airport.
This is what an auction watch looked like a few years ago in FloraHolland's trading floor in Blaiswijk.
Modern photos of the auction room, see below.
Royal FloraHolland is an innovative firm. She actively introduces Internet technologies into her business. Since 1997, traders have been able to buy flowers at FloraHolland auctions via the Internet. To do this, FloraHolland installed the i-KOA (internet Kopen Op Afstand) system, or simply KOA. Now traders do not have to be present in the auction rooms in person, they can participate in the auction remotely by connecting to the auction hours through the KOA system. As of early 2010, FloraHolland has installed 1600 KOA remote connections, most of which - 1200 are located in Holland, and 400 - outside of it. Thus, traders around the world can buy flowers at Dutch auctions remotely.
Currently, around 45% of the flowers sold daily at FloraHolland's largest export auctions in Aalsmeer, Neidwilk and Rijnsburg are sold remotely. In the future, the percentage of online sales will only increase.
How does the remote trading system work?
Several windows with auction watches open on your monitor screen. You choose one main window in which to bet online. At the same time, up to 4 additional windows with auction hours can be enabled, through which you can follow the flower lots. Additional windows show the name of the product, the manufacturer and the price of the lot.
If you are a member of Royal FloraHolland and run your business in flower auctions (sell or buy flowers), then you can watch the auction remotely, from anywhere in the world, online from your computer. The cost of the service is 15 euros per month.
Royal FloraHolland conducts its business openly. Every day, during the flower auctions, guided tours are held, spectators watch the auction and the movement of carts with flowers in storage from a special gallery. A ticket for a guided tour in Aalsmeer costs €7.00 for adults and €4.00 for children. Subscriptions for several months are also sold. Spectators are also invited to tour the flower auction in Oelda.
Let's take a look at Royal FloraHolland. Watch a short photo and video tour of the places where flower auctions take place.
Aalsmeer flower auction (Bloemenveiling Aalsmeer)
Flower auction in Blaiswijk (Bleiswijk)
Flower auction in Naldwijk (Naaldwijk)
Flower auction in Rijnsburg (Rijnsburg)
Flower auction in Elda (Eelde)
Photo courtesy of www.royalfloraholland.com.
This short educational video shows the path that flowers take (using the example of Dutch tulips and Kenyan roses) from the place of cultivation to the buyer. You can clearly see how the bidding at the flower auction takes place. See how flowers are prepared for the auction, how their quality is checked with special devices.
Video prepared MyFloraHolland.
In this article, you met the main flower supplier in the markets of Europe and Russia.
When you buy flowers, you can assume that with a probability of more than 80% they have passed through the Royal FloraHolland auctions.
What about the other 20%?
10% of our market is made up of domestically produced flowers.
The remaining 10% accounts for all other flower delivery options.
1. What are Dutch auctions?
A Dutch auction is an auction model where the (initial) starting price of an asset is equal to its face value at the start of the auction. During the open trading session, at regular intervals, the price is automatically and step by step reduced by the auction step - 1%. Thus, during the day of trading, the price may drop from 100 to 20% of the face value.
2. How does the Dutch auction system work?
Each bidder can stop bidding at an acceptable price level by clicking the "buy" button. This completes the automatic incremental price reduction of the lot. Further, according to the rules of the "pilot project", which is being implemented in the Fund, other registered participants in the auction are given time to submit their closed price offer (sealed-bid), which must exceed the bid at which the price reduction stopped.
The period for submission of closed bids will start at the same time, regardless of the time of the bid: from 16:15 to 16:55 and will last 10 minutes. For example, if a bid is made at 11:00 or 13:00, the closed bid submission period will still only start between 16:15 and 16:55.
Upon completion of the stage of submission of closed bids, all of them are disclosed and the participant who stopped the automatic step-by-step price reduction by placing a bid, receives the right, within a certain period of time (5 min.), to "Break" at least one step of the auction the largest closed price offer of the "rival" ” and offer your last price (“best and final”). Only under this condition will he be declared the winner.
Otherwise, the winner of the auction is the participant who offered the highest price for the lot at the stage of submitting closed bids.
If there are no price offers closed, then the winner is the participant who made a bid and stopped the automatic step-by-step price reduction.
(Section 7 of the Regulations)
3. Who can participate in Dutch auctions?
An individual with full legal capacity or a legal entity (resident or non-resident) represented by an authorized representative who has discovered an intention to participate in an electronic auction, paid a guarantee fee, completed the registration procedure for participation in an electronic auction, received the appropriate confirmation of registration and an individual code participant in accordance with the ETS Regulations.
A participant in an electronic auction, the subject of sale of which has rights of claim under loan agreements and collateral agreements, cannot be a user who is a borrower (debtor in relation to the bank) and / or a guarantor (property guarantor) under such loan agreements and / or collateral agreements.
(Clause 5.11 of Chapter 5 of Section V of the Regulation on the Withdrawal of an Insolvent Bank from the Market)
4. What are the main regulations governing the sale of assets at Dutch auctions?
Law of Ukraine "On the system of guaranteeing deposits of individuals".
The rules of operation of the electronic trading system for conducting an electronic auction, which consists of an automatic step-by-step reduction in the initial (starting) price of the lot, the stages of submitting closed price offers and a price offer for the sale of bank assets (property), are withdrawn from the market or liquidated.
Decision of the executive directorate of the FGVFL
Regulations on the organization of the sale of assets (property) of liquidated banks, approved by the decision of the Executive Directorate of the Fund dated March 24, 2016 No. 388.
Regulations on the Committee of the Deposit Guarantee Fund for individuals on the issues of consolidation and sale of assets, approved by the decision of the Executive Directorate of the Fund on July 05, 2017 No. 2837.
5. What assets will be sold at Dutch auctions?
At the first stage, as part of the "pilot project" for sale through Dutch auctions, bank assets will be offered, the liquidation period of which ends within the next 6-9 months. These assets will be put up for sale immediately in pools, because in terms of pricing it makes no sense to sell them individually. After all, after each of them there were several cycles of individual trading, to which the market did not react. After holding the first auctions for the above categories of assets and studying the practical results of their implementation under the new model, other categories of assets will gradually be transferred to the new model while maintaining the current one.
The main assets traded on the model of "Dutch" auctions are the rights of claim on loans of individuals, secured by mortgages.
6. Who makes the decision to put a particular asset up for public auction?
Such a decision is made by the Fund (Executive Directorate or Committee)
The Committee implements its tasks for an asset (property), lot, pool of assets (property), the book value of which (which) is less than UAH 100 million and the initial price / sale price of which (which) is less than or equal to the book or estimated value (for rights of claim under credit agreements - in less or equal debt under such agreements (debt on the principal debt, accrued interest, as well as commissions stipulated by the agreement) or the estimated value).
(Section 1 of the Regulation on the Committee; subparagraph 5 of chapter 5 of section V of the Regulation on the withdrawal of an insolvent bank from the market (No. 2))
7. What are the differences between the Dutch auction and the traditional one?
The use of the Dutch auction will make it possible to optimize the rate of sale of assets of liquidated banks. In order for potential investors to have time to familiarize themselves with the assets, the Fund decided to revise the existing pre-sale terms for exposing assets.
During Dutch auctions, it takes 30 business days or more to familiarize the market with the lot. In addition, restrictions on the number of participants in the auction have been lifted. According to the new model, the auction will be considered completed if at least one participant takes part in it and makes a bid. At the same time, none of the potential buyers will know how many participants have registered for the auction in general. And it will be possible to join the auction even on the day of the auction after it starts.
8. Where can I find information about which lots are for sale and according to what system (classic auctions or Dutch)?
Information about the lot published on the website of the bank selling the asset, in the prozorro.sale/ system, on the Fund's website www.fg.gov.ua/ and on the information portal torgi.fg. gov.ua/. As well as on the web portals of the relevant trading platforms that have been accredited by the Fund.
9. How is the initial price of a lot determined?
The pricing ideology will be as follows: the starting price will be set at the nominal level, and during the auction it will gradually decrease to 20% (the minimum price is set by the decision of the executive directorate for each individual auction). The price will be reduced automatically and step by step during the working day. If the auction does not take place, certain assets - primarily large loans to corporate clients - by the decision of the Fund may be re-sold according to the above model (100% - 20%), but not more than twice.
If the asset has not been sold, it will be withdrawn from individual trading. In the future, it will be sold exclusively in pools, the starting price of which can be set at the level of the nominal value of the pool components or 20% (the minimum price of the pool components).
If the pool is not sold, its next starting price will be set at the level of the minimum price set in the previous unsuccessful auction and will again step by step and automatically decrease to 20% of the starting price. This procedure will be repeated until the pools are sold.
Example: 1st auction - the starting price of the lot is 100 thousand UAH. Due to the lack of bids, the price dropped to UAH 20,000, but the winner has not been determined, and the auction did not take place. The lot is put up for re-auction.
2nd auction. An asset that has not been sold before is put up for auction as part of a pool of assets and the starting price of this asset in the pool is UAH 20,000. (The total starting price of the pool, made up of the value of the starting prices of individual types of assets, is included in this pool).
(Subparagraph 3 paragraph 2 of the Regulations on the pilot project)
10. How can I get acquainted with the documents for a specific lot?
By signing a non-disclosure agreement, the bank grants the potential buyer the right to get acquainted with information constituting banking and commercial secrets. Familiarization with the information takes place in the data room of the bank.
11. How to get access to view documents of the Bank's asset in the virtual data room (VD)
(Section 5 of the Asset Disposal Regulations)
12. Is it possible to get acquainted with the asset purchase and sale agreement at the stage of the lot exposition?
You can familiarize yourself with the recommended form of the sale and purchase agreement by downloading it from the information portal of the Fund (http://torgi.fg.gov.ua/shabloni-dogovor-v.php) or contact the bank that sells the property that the potential buyer.
13. How long does it take to conclude a sale and purchase agreement for property purchased at an auction?
The Bank concludes an asset (property) purchase and sale agreement not earlier than three working days and not later than 20 working days from the date of completion of open trading (auction) with the possibility of extending this period by decision of the Fund, in case the Fund receives a reasonable representation from the bank (the total period is not may exceed 42 business days).
(Clause 4 of section 7 of the Regulation on the sale of assets)
14. I took a loan from a bank and pay it according to the terms of my agreement. On what basis is the claim on my loan put up for auction?
The sale of the right to claim under a loan agreement takes place in pursuance of the requirements of Articles 48, 51 of the Law in compliance with the provisions of Articles 512, 514, 516 of the Civil Code of Ukraine. Regardless of whether the borrower repays the loan or not, the Bank may put the claims under the loan agreement up for auction for sale.
(Articles 512, 514, 516 of the Civil Code of Ukraine)
II. Detailed consideration of the "Dutch auction" mechanism
1. What is the Dutch auctions selling model for?
Unlike English auctions (the so-called English Forward), where participants gradually increase the price of their offer, Dutch auctions (Dutch auction) work with a price reduction. During the auction, the price automatically decreases until one of the participants stops this decrease. This means that he is ready to buy a lot for this amount.
The Dutch auction is not better or worse than other auction models. It is simply more efficient for a certain type of asset. First of all, to those for which it is difficult to determine the market price - this price is determined by the participants.
2. What are the main stages of a Dutch auction (an overview of the stages of the auction)?
a. preparatory stage
At this stage, the authorized person submits an asset sale plan to the Fund, the Fund's executive directorate or the Asset Sale Committee approves the decision to sell the bank's assets (property). The decision formalizes the main parameters for the sale of an asset.
b. exposition
Information about the asset is published on the information portal of the Fund http://torgi.fg.gov.ua/, http://www.fg.gov.ua/ as well as on the ProZorro.Sales portal and on the websites of accredited exchanges. Potential buyers get acquainted with the public passport of the asset. If desired, they can also get acquainted with detailed information about the selected asset containing commercial or banking secrets, having previously signed a non-disclosure agreement.
c.Trading session
The buyer registers for the auction: chooses a trading platform and pays a guarantee fee.
On the declared day, the trading session starts (from 9:30 to 10:00).
The first stage: automatic step-by-step price reduction. This stage lasts 6 hours. 45 min. and ends between 16:15 - 16:45. Any of the participants can make a price offer, after which the auction stops.
The period for submission of closed bids. At 16:15 - 16:45 the period of closed price offers begins, it lasts no more than 10 minutes. Participants offer their own price, which cannot be less than the rate that was in effect at the time the auction was stopped. The participant who stopped the auction does not participate at this stage.
Bid submission period. From 16:25 to 17:00 closed price offers are disclosed, the stage lasts 5 minutes. Only the participant who stopped the auction during the first stage of the trading session participates. He may improve his quotation by submitting a quotation that must be at least 1% higher than the most closed quotation submitted during the previous stage.
The winner is automatically determined and the bidding protocol is formed. The protocol is signed within 3 working days and uploaded to the ProZorro.Sales system.
d. End of auction
The winner transfers the required amount for the acquired property (assets) to the bank details and signs the contract of sale. It should be noted that payment and signing of the contract of sale is carried out within 20 working days.
(Section 7 of the Regulations)
3. To what level can the price fall during the auction?
Automatic step-by-step price reduction from the initial to the sale price will occur within one day. In general, during the day of trading, the price may drop from 100 to 20% of the face value.
(Subparagraph 1 paragraph 2 of the Decision on the pilot project)
4. Will all assets be sold on the Dutch auction model from now on?
Tentatively, by the end of 2017 there will be a pilot project for the introduction of "Dutch auctions". The first auctions under the new system took place on October 30, 2017 (two auctions for the sale of assets of Erde Bank OJSC (lots FG21EK01 (pool of assets) and FG21EK02 (individual lot for the sale of the right to claim under a loan agreement). The first auctions for the "Dutch model" were recognized, did not take place.
The pilot project will sell:
Assets of banks whose liquidation period ends within the next few months;
Rights of claim on loans of individuals secured by mortgages of such banks: Delta, Nadra, Finance and Credit, Fido, VAB and other banks;
Rights of claim on loans of individuals not secured by mortgages, debts over UAH 3 million.
At the same time, loans for which the decision to sell was made earlier continue to be traded until the end of the corresponding trading cycles.
Mortgages from other banks are traded according to the old system (“English auctions”).
(First Dutch auction - https://prozorro.sale/auction/UA-EA-2017-10-09-000224-c)
5. What happens to the assets (property) that could not be sold at the first Dutch auction?
Pools will be formed from assets not sold at retail. The starting price of such pools is equal to the price of the pool components, namely, 20% of their face value.
(Subparagraph 3 paragraph 2 of the Decision on the pilot project)
6. What is the minimum number of bidders that can bid?
One bidder can participate in the auction.
7. What is the auction step for the Dutch model?
The auction step (decrease step) is set by the decision of the Fund and is noted in the announcement of the sale of the asset. Typically, the reduction step is 1%.
8. What is the amount of the guarantee fee?
The cost of the guarantee fee is 5% of the initial price of the lot, the guarantee fee is returned to those participants who are not recognized as winners in the auction. The guarantee fee is returned to the winner after the full payment for the lot and the signing of the purchase and sale agreement, minus the commission of the trading platform (exchange). The winner of the auction, who won the auction, but violated the terms and conditions of sales, the guarantee fee is not returned.
(Established in accordance with the decision of the Executive Directorate of the Fund)
9. To what details is the guarantee fee paid?
To the details of the exchange, through the electronic platform of which the participant registered to participate in open trading (auction).
(PP. 1.1. clause 1, PP. 7.5 clause 7 of the Regulations)
10. In what cases is the guarantee fee refundable?
The guarantee fee is returned after the end of the auction within 3 working days to the participants of the open bidding (auction), except for the winner. The guarantee fee is also returned to the winner of the auction minus the commission of the trading platform (stock exchange) after signing the contract of sale.
(Clause 4 of Section VII of the Sales Regulations)
11. Can I register for a Dutch auction during the auction?
Yes, but you must register for the auction before 16:00 on the day of the auction (information with the exact date and time is published in the announcement of the auction). Access to participation in the auction will be provided to the buyer after the paid guarantee fee is credited to the exchange account.
12. How to get acquainted with the regulations of the selected electronic trading system?
On the websites of each of the exchanges, accredited and working through the ProZorro.Sale system, there is an opportunity to familiarize yourself with the regulations of this exchange.
13. By what principle will assets be grouped that are not sold at retail?
Several approaches are currently being considered. One of the possible criteria by which pools can be formed is a grouping by belonging to a bank, that is, “one pool - one bank”. Another scenario that is currently being considered is the grouping by region of assets - north, south, west and east. The third approach assumes grouping by asset categories - for example, if mortgage loans of individuals have not found their buyer at retail, they will be formed into pools according to the criterion of belonging to this category of assets (mortgage loans of individuals).
14. Does the borrower redeem the right of claim on his loan?
No. The borrower and the guarantor (if any) cannot participate in the auction.
If after the end of the auction it is found that the winner of the auction is the borrower or the guarantor, the auction will be declared invalid, and the guarantee fee will not be returned to the winner.
15. Why are there so many electronic trading exchanges and how are they different from Prozorro.Sales?
The Fund is constantly selecting exchanges for the sale of assets (property) of banks for the sake of greater convenience for potential buyers, improving competition between operators, and bidding.
All exchanges accredited by the Fund are included in the Prozorro project. The sales portal https://prozorro.sale/ is not an exchange and acts as an information platform (“Single Cabinet”). It is not possible to take part in the auction directly through this portal. However, you can select an auction, read the open auction documentation, conditions, select a trading exchange (follow the link to the website of the auction organizer), and also follow the link to the auction page and monitor its progress in real time.
16. I want to purchase assets (property) of the bank. How do I know when the auction for this property will take place?
If the property you are interested in is not yet sold at auctions, you should contact the authorized person of the Fund to liquidate the bank on whose balance sheet it is recorded, with a proposal to put it up for sale.
18. I won the open auction, but did not pay the full amount determined by the results of the auction on time. Is my security deposit refunded?
No, in such cases the guarantee fee is non-refundable. If a potential buyer believes that his rights have been violated, he can file a complaint for consideration with the Fund (see section 5).
19. Procedure for payment of funds for the purchased lot
After the protocol is signed by the Winner by the Trading Platform (exchange) and the Bank, the Bank uploads it to the Prozorro.Sale central database, and the uploaded protocol will appear on the lot page on the prozorro.sale website.
After that, the winner pays money for the acquired asset to the bank details recorded in the protocol.
Then the guarantee fee is returned to the winner, minus the operator's remuneration.
20. Is it possible to extend the payment term for the purchased lot and the signing of the sales contract?
If there are good reasons, the Bank has the right to submit a letter to the Fund with a request to extend the term for paying for the lot and signing the sale and purchase agreement. The Complaint Review Commission has the right, based on the results of the consideration of the complaint, to recommend to the Executive Directorate to take a decision on extending the term for signing the sales contract.
(Clause 4 of section 7 of the Regulation on organizing the sale of assets)
21. In what cases is it necessary to certify a contract of sale by a notary?
According to Article 55 of the Law of Ukraine "On Notaries", transactions on the alienation of property subject to state registration are certified subject to the submission of documents confirming the ownership of the alienated property. When certifying transactions for the alienation of immovable property, the absence of a prohibition on the alienation or attachment of property is checked.
At the request of an individual or legal entity, any transaction with its participation can be notarized.
(Article 209 of the Civil Code of Ukraine)
22. Who decides to cancel the auction results?
Electronic trading or its results may be canceled (cancelled) by the bank at any stage solely on the basis of the relevant decision of the Executive Directorate of the Fund.
(Clause 7.3 of section 7 of the Regulation on organizing the sale of assets)
23. How to return the funds paid for the asset by the winner, if the auction is declared invalid, not through the fault of the buyer?
Is the security deposit refundable?
Returned in full.
How is the principal amount (price) of the asset returned?
In the event that a contract for the sale of assets (property) of the bank (s) is concluded and payment is made under such an agreement, the funds paid are returned to the winner of the open auction in the manner and within the time limits specified by the legislation on the transfer of funds. At the same time, if such funds are received on the bank's savings account, the bank is obliged to inform the new creditor about their return to the borrower.
(According to paragraph 7 of section 7 of the Regulation on the organization of the sale of assets)
If the buyer made payment for the asset (s) (property) of the bank before the conclusion of the contract for the sale of the asset (s) (property) of the bank and the Fund decided to cancel the results of open trading (auction), the bank returns to such a buyer the funds transferred by him within three working days from the date of such decision by the Fund.
(Clause 7 of Section 7 was supplemented with a new paragraph in accordance with the decision of the Executive Directorate of the Fund dated 23.08.2017 No. 3778)III. WORK WITH SITES HTTPS:// PRO ZORRO.SALE / TA HTTP://TORGI.FG.GOV.UA/
V. NON-STANDARD QUESTIONS AND SITUATIONS:
1. Does the Fund have the right to sell the right to claim on a loan taken in foreign currency if the Law on Foreign Exchange Moratorium is in force in Ukraine?
The effect of the norm of the Law "On the moratorium on the recovery of property of citizens of Ukraine provided as security for loans in foreign currency" in terms of the assignment (sale, transfer) of debt or debt in favor (in ownership) of another person does not apply to banks classified as insolvent and according to which the procedures for withdrawing from the market are carried out in accordance with the Law of Ukraine "On the system of guaranteeing deposits of individuals".
(Clause 1 of the Law of Ukraine "On the moratorium on the recovery of property of Ukrainian citizens provided as collateral for loans in foreign currency")
2. At the first stage of the Dutch auction, I placed a bid and stopped the price reduction. Does this mean that I am the winner of this auction?
Not yet. In the period from 16:15 to 16:55, the next stage of the auction will begin - the period for submitting closed bids. Other participants (everyone except the participant who stopped the auction) can make their bids (at least 1 step upwards from the fixed price (the one at which the auction was stopped).
At the next stage, after opening the participants' closed bids, the participant who stopped the auction has the right to raise the highest bid.
3. At the first stage of the Dutch auction, I placed a bid and stopped the price reduction. Can I place a bid during the closed bidding period?
No, the participant who made a bid and stopped the price reduction at the stage of closed bids does not participate.
4. At the first stage of the Dutch auction, I placed a bid and stopped the price reduction. What are my actions after opening closed bids?
If one of the other participants during the second stage made a higher bid than the one at which the fall in the value of the asset was stopped, the participant who made a bid during the first stage and stopped (fixed) the price, at the third stage (after opening price offers ) decides:
He can make a bid higher than the highest bid made in the second stage (in this case, this participant will be declared the winner)
Refuse the bid (in this case, the participant who made the highest bid during the closed bidding stage will be declared the winner).
5. I took part in the auction, but did not win. Will my security deposit be refunded and when?
So, the guarantee fee is returned within 3 business days after the end of the auction.
6. I took part in the auction and was declared the winner. What are my next steps?
Within 3 working days to sign the protocol of open trades (auction).
Within 20 working days after the end of the auction, pay the full cost (minus the amount of the guarantee fee) of the asset, determined as a result of the auction, according to the details.
After paying the full price for the asset, sign the contract of sale.
7. I took part in the auction and was declared the winner. Do I have to go to Kyiv so that within 3 days I sign the original protocol of the auction?
Within 3 working days, the winner is obliged to sign the protocol of the auction at the location of the organizer of the auction - the electronic trading system through which the winner of these open auctions took part in the auction.
8. I won an open bid but don't have enough money to pay. How long do I have to deposit this amount?
Full payment for the purchased lot is made within 20 working days after the end of the auction. In exceptional cases, the term for signing the sale and purchase agreement may be extended up to 42 working days by the decision of the Fund (the proposal of the Executive Directorate of the Fund is submitted by the Complaints Committee).
(Subparagraph 6 of paragraph 6 of Section 3 of the Regulations on the Complaints Review Board)
9. I won the open auction, but within a certain time I did not deposit the full amount determined by the results of the auction. Is my security deposit refunded?
No, the winner of the auction, who refused to purchase the lot, will not be refunded the guarantee fee.
10. I purchased an item at auction, but the actual characteristics do not match those stated in the public asset data sheet?
A participant in an open bidding (auction) may file a complaint in the prescribed form by e-mail This email address has been protected from spambots. you need to turn on JavaScript to make it work. which will be considered by the Fund's Complaint Review Board. The complaint form can be found at http://torgi.fg.gov.ua/komisiya.php
11 May, 2012 - 07:57
The RHD Foundation will be allowed to hold "Dutch" auctions for the sale of land, which will help make housing more affordable.
For the construction of economy-class housing in Russia, they will be sold at the so-called Dutch auctions, which will become a new mechanism for state support for certain categories of citizens when they purchase housing. Last week, the State Duma adopted in the first reading the draft law “On Amendments to the Federal Law “On Assistance to the Development of Housing Construction”, which gives the RHD Foundation the right to conduct auctions according to the so-called Dutch system.
What does it mean? A "Dutch" auction is a bidding for a price reduction. A striking example of such an auction is the sale of flowers in the Netherlands. The US Customs Service also uses "Dutch" auctions to sell unclaimed goods that have been in storage for a year. There have already been precedents for holding "Dutch" auctions in Russia. All of them concerned the sale of real estate.
For example, in the fall of 2011, the Property Fund of St. Petersburg organized "Dutch" auctions for the sale of built-in commercial premises, most of which were of interest to representatives of small and medium-sized businesses. Sellers of state property were guided by the norm, which is spelled out in 178-FZ "On the privatization of state and municipal property." In the law, this method of sale is called "sale by public offer".
Now the Fund holds land auctions, where the subject of bargaining is the acquisition of the right to conclude a lease agreement for a land plot. These auctions are held according to the rules of the "English" auction: they are open according to the composition of participants and the method of submitting proposals for the price. The developer who declares the maximum price for the lot is recognized as the winner.
Unlike the "English" auctions, the "Dutch" auction is won by the one who offers the maximum reduction in the price of 1 sq. m. m of economy class housing from the price of housing established by the Ministry of Regional Development of Russia. The winning company will be obliged to build economy-class housing on the acquired land plot that meets the requirements of the Ministry of Regional Development of Russia, and sell it at the price fixed at the auction to certain categories of citizens, which will be established by separate regulatory legal acts.
In our opinion, holding "Dutch" auctions will become one of the tools to increase the affordability of housing. First, we are talking about purposeful provision of housing for certain categories of the population who cannot purchase housing at free prices.
We assume that this list will include, first of all, citizens who need state support: civil servants, military personnel, specialists in the field of healthcare and education, as well as those on the waiting list who claim to improve their living conditions.
Secondly, such auctions can significantly change the price policy in the segment of economy class housing and make it even cheaper. Currently, on certain land plots of the RHD Foundation, the maximum reduction in the sale price of economy class housing at the level of 10% of the price of the Ministry of Regional Development of Russia has been recorded. In the process of developing auctions on the "Dutch" system, the correlation of the normative price of the Ministry of Regional Development with the actual market value of housing will be clear, which will give real guidelines for the market.
Now it is difficult to predict by what percentage it will be possible to reduce the cost of housing.
The bill provides for the possibility of selling a certain fixed amount of housing at reduced prices. In each case, it will be determined based on the existing need for economy-class housing and the availability of guaranteed demand from citizens who want to purchase such housing at a specified price. If we are talking about one auction, for example, for the sale of 10 apartments within the boundaries of the Moscow region, then this is unlikely to significantly affect the price situation in the housing market. If we are talking about mass sales in different localities, then in this case it would be appropriate to expect the effect of cheaper housing.
The Dutch auction is built on the exact opposite logic compared to a regular auction. During the Dutch auction, the prices for the lot put up for auction do not increase, but decrease.
Scheme of the Dutch auction
The logic of the Dutch auction is based on the fact that the auctioneer who implements the auction initially declares for the lot put up for auction not the minimum, but the maximum price. Theoretically, the auction can end right at this stage, if one of the participants expresses a desire to purchase this product for the specified price. However, in practice, buyers most often wait for the price to start to decline.This is the next stage of the auction. If the auctioneer realizes that no one was willing to pay the price indicated by him, he begins to reduce it. This is another significant difference between the Dutch auction and the usual one: in the course of the latter, the price increase is usually the prerogative of the buyer, who thereby designates an acceptable framework for the cost of the goods. In the course of a Dutch auction, the role of the buyer is to wait until the auctioneer himself lowers the price of the goods to an acceptable price for him.
Nevertheless, it should be understood that this expectation should not be delayed too much: the lower the price falls, the more likely it becomes that there will be a buyer for whom it will be acceptable. In this case, the winner of the Dutch auction is the participant who first expressed a desire to purchase the goods at the price indicated by the auctioneer.
Features of the Dutch auction
The Dutch auction process is usually largely automated. So, in the immediate vicinity of the places where the participants are located, there are special buttons that allow them to signal the auctioneer if they agree to purchase the item at the price announced by him. At this point, the auctioneer immediately sees the number of the buyer who pressed the button. This feature of the Dutch auction significantly speeds up its implementation compared to the usual scheme.The Dutch auction got its name due to the fact that it was in this country that it was very widely used. In particular, it is used in the process of organizing the sale of the famous Dutch tulips. At the same time, another feature of such an auction is that it is focused on the sale of wholesale lots of goods, which means that it allows you to sell large volumes of products in a relatively short period of time.
In the Russian Federation, there are currently several trading platforms that organize public sales - auctions, including an online auction, where potential buyers are informed about the opportunity to buy or sell various types of property: objects, property rights, rights of claim, receivables, accounts payable debt, shares, shares in the authorized capital.
- The most common auctions:
- car auctions(auto auction), auction of special equipment, auction of motorcycles and other transport (water, air, railway);
- real estate auctions(apartments, suburban and commercial), as well as land auctions (auctions of land plots);
- property auctions(equipment, coins, paintings, antiques, state auctions);
- auctions right to rent and the right to conclude a contract, auction for supply or procurement.
Various types of sale of property and property rights are possible, depending on the presence of encumbrances ( bail, arrest, restriction of registration actions) and stages of implementation: monitoring(acceptance of offers from interested buyers, followed by determination of the initial sale price of the property) - the so-called "presale"– studying the demand for property, with a parallel assessment, in cases where an assessment is required; extrajudicial (voluntary) sale collateral or non-collateral property; sale of property by bailiffs executors in the framework of enforcement proceedings, through bidding or commission (commission agreement); sale of property at auctions (bids).
Depending on the decision made by the bank and the borrower, the leasing or insurance company, arbitration managers and various legal entities, it is possible to determine the most effective system for selling property.
We invite you to familiarize yourself with the information about Auctions (tenders).
Definition of an auction
Auction(from lat. auctio - "multiplication" or "public sale") - public sale of goods, securities, property of enterprises, works of art and other objects, which is carried out according to pre-established rules of the auction.
Auction form. Participation in the auction
It all starts with the submission of the necessary documents. Depending on the type of property put up for auction, sets of documents may differ. For example, for holding an auction for the sale of a property provide: a certificate of ownership, a contract of sale or lease, as well as other documents on the basis of which the ownership arose; cadastral passport, extract from the Unified State Register of rights to real estate and transactions with it, certificates of the absence or presence of encumbrances; description of the object and other documents characterizing the material and technical condition of the object (contracts for public services, reconciliations of payments, lease agreements, etc.). After submitting the documents through the evaluation, the seller is recommended the initial bid price. Next, the main terms of the auction are agreed.
The world experience of holding auctions shows that in the process of bidding for investment-attractive objects, with the condition of setting the initial sale price of the most attractive property for potential buyers, an excess of the possible upper level of the market price of the property may occur at the auction. After the condition, the step of the auction, the amount of the deposit paid by the participants is agreed upon. In conclusion, the system (type) of the auction and the date of the auction are agreed.
Auction types
There are several main types of auctions in the bidding system - an auction according to the English system and an auction according to the Dutch bidding system.
English system (English auction)- an auction in which a minimum initial price is set, and the price gradually increases during the bidding process. The final price is formed during the auction and is determined as the last maximum offered by the participants. This happens by raising the card by the auction participant for the price announced by the auction organizer. When the person conducting the auction has determined the first participant who raised the card, the price of the lot increases by one step. The step of the auction is prescribed in the terms of the auction. The auction ends after three announcements by the auctioneer (the person conducting the auction) of the price of the lot, and after that, none of the persons participating in the auction offers a higher price by raising the card with an increase in the price of the lot by one step. The winner of the auction is the bidder who offered the highest price. A bidding (auction) is recognized as failed if none of the participants agreed to pay the initial price for the lot. In this case, the auction (auction) is terminated, and the organizer of the auction (auction) declares them invalid.
Dutch system (Dutch auction)- an auction in which the seller determines the so-called cut-off price (the lower limit of the cost of the lot, below this limit he will not sell the lot). In such a system, options for increasing or decreasing can be used, namely, if at the beginning of the auction (auction) one of the participants agreed with the initial price, then the auction (bidding) is carried out for an increase according to the English system (in accordance with the English auction system). ), and if none of the participants in the auction (bidding) agreed with the initial price (did not raise the card of the participant), then the auction (bidding) will be held on a decrease until the cut-off price is reached in the process of reducing the cost, if during bidding, none of the participants will agree with one of the proposed (decreasing) prices. After that, the auction starts again in the direction of increasing the cost of the lot. If none of the participants shows interest and does not raise the card (i.e. does not agree with the price announced by the auctioneer when it was raised), then in this case the auction is terminated, and the participant who offered the maximum price is recognized as the winner.
What is a trading session? It should not be confused with the English or Dutch auction (auction), because it was created on the basis of the English system (auction), i.e. bidding for an increase, but takes place without announcing the initial price of the lot (object of sale). The seller of the property determines the minimum price of the object. The bidders make their bids until the maximum offer is revealed, ie the maximum price is offered. If during the bidding (auction) the minimum price set by the owner is reached or exceeded, then the bidding is considered completed, and the lot, in accordance with this, is sold at the last price (maximum) announced by the bidder. And if the minimum certain price of the seller (property owner) is not reached, the auction is stopped by the person conducting the auction, and the auctioneer asks the property owner (seller or representative) for consent to sell the lot at the price reached during the trading session. If the seller decides to sell the object at the proposed price, the auction ends. If the owner refuses to sell the lot (object) at the proposed price, then the participants in the trading session are invited to continue trading, i.e. bargain for the object (lot) offered by the seller.
There are also exclusive forms of property sale, under which all conditions are determined individually.
An auction for one of the selected types is carried out in strict accordance with the previously agreed terms of the auction (auction).
Currently, auctions (bidding) in Russia are becoming more public and open.
The Problem Loans Committee of the Association of the North-West recommends that you carefully study the conditions for conducting auctions and, on all matters of interest, be sure to clarify information with the organizers of auctions (bids).
Head of the Department for the Execution of Judicial Acts of the Legal Directorate
JSC "Bank "Saint-Petersburg"
Chairman of the Problem Loans Committee
Association of Banks of the North-West
Martynov Oleg Viktorovich
