The Australian Competition and Consumer Commission (ACCC) warns government agencies of potential collusion, or cartel behavior, between bidders during procurement processes.
The agency said it was concerned that some officials and companies were not sufficiently aware of potential breaches of cartel laws during procurement processes.
The ACCC defines cartels as companies that enter into agreements with their competitors to fix prices, rig bids, share markets or restrict production, resulting in inflated prices and reduced choices.
The warning comes amid a number of cartel cases the ACCC has taken to court, including a long-standing case involving investment banks Citi, Deutsche and ANZ, as well as another case involving a building management system company filed in May of this year.
“Cartel conduct by companies bidding in a public sector procurement process is illegal, just as such conduct is illegal in the context of a private sector bidding process,” he said. said ACCC President Rod Sims.
“Encouraging companies to discuss their bids among themselves, or to reach agreements on who will bid on a particular tender, is likely to constitute cartel conduct that is against the law. “
Sims added that cartel activity could begin as little as “a little encouragement or an innocent remark” that could potentially create an environment that allows, condones or facilitates collusive conduct between competing companies.
“Competition to provide governments with goods and services is critical to ensuring value for money for taxpayers. Conducting cartels in government procurement is therefore not only against the law, but will often cause taxpayers to pay significantly more for goods and services, ”said Sims.
“We encourage public sector procurement professionals to proactively review their procurement processes and identify and correct any potentially anti-competitive elements in procurement procedures, policies or guidelines. “
In May of this year, ACCC announced that it would sue Canberra-based building management systems company Delta Building Automation for allegedly attempting to rig a bid for a tender led by the National Gallery of Australia.