The Deputy Minister of Research, Innovation and Digital Policy has expressed disagreement with the conclusions of the Auditor General‘s special report on the “Electronic Identity” project regarding the direct assignment of the contract without open tender procedures.
The ministry stated it acted with complete transparency, legality and respect for the principles of healthy competition throughout all stages of project design and implementation.
The ministry’s response has been published as Appendix III of the audit report through two detailed letters already submitted to the Auditor General.
Ministry defends transparency and legality of procurement process
The ministry stated that the regulatory and legal framework for national electronic identities does not permit entities without infrastructure in Cyprus and proper licensing to participate, describing references to other EU entities as “misleading”.
The ministry created the “National Electronic Identity Scheme” in 2021, made available to all interested economic operators without discrimination. This framework was subject to public consultation in 2020.
Public announcements about the government’s intention to proceed with electronic identity distribution were made by relevant deputy ministers from 2022 onwards.
Despite these actions, no other economic operator proceeded with implementing necessary infrastructure in Cyprus or secured authorisation from the competent authority to meet electronic identity issuance requirements.
The decision for the negotiated procedure was taken by the Deputy Ministry’s Tenders Board on 11 October 2024. The Council of Ministers decision dated 10 October 2024 concerned the political decision to subsidise the provision of 100,000 electronic identities.
Regarding the “voluntary announcement” procedure recommendation allowing 10 days for third parties to submit objections, the ministry considered this unnecessary based on the existence of only one qualifying economic operator, lack of interest from potential providers approached, and extensive prior information.
Deputy minister disputes “peculiar relationship” characterisation
References to a “peculiar relationship” between the deputy minister and the contracting company are described as “unfortunate”, as they risk creating erroneous impressions and ignore the project’s historical depth.
The project was designed and developed from 2017 under the supervision of three successive government formations and completed in 2025.
The completion represents a “natural continuation of a multi-year institutional process and is in no way connected to personal relationships or ulterior motives”.
The ministry stated it neither adopts nor accepts claims that leave questions regarding the legality and transparency of the procedure.
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