What is bid rigging, how to detect it, when is the cooperation between bidders allowed? – these are most essential issues raised by UOKiK during the conference titled “Competition protection in public procurement”, the event commenced in Toruń

The antimonopoly law prohibits entering into competition-restricting agreements. Fixing by bidders the conditions of submitted tender offers constitutes one of prohibited practices

The antimonopoly law prohibits entering into competition-restricting agreements. Fixing by bidders the conditions of submitted tender offers constitutes one of prohibited practices. According to the data collected by the Public Procurement Office, in the year 2011, the value of public procurement in Poland was estimated to be approx. PLN 144 billion. At the same time, the estimation by the OECD indicates that concluding prohibited agreements may result in increasing the price incurred by the ordering party even as much as 20%. Thus bid rigging results in spending public money in an ineffective way, which is harmful to cosumers and finally affects tax payers.

The experiences of UOKiK show that prohibited agreements are concluded most frequently through the resignation of a tender winner from contract conclusion. It is aimed at enabling the second-rate undertaking perform the task – the undertaking whose offer was more expensive. Another type of agreement which may be classified as contrary to law, is limiting the number of bidders in order to select the chosen entity as the tender winner. Moreover, it is prohibited to use a rotary submission of offers consisting in sharing the win between the collusion participants in subsequent tenders. The market division by the participants to a collusion constitutes another practice contrary to law. It results in the fact that only the bidders determined beforehand may participate in a tender procedure in a given territory.

The survey* conducted this year by the commission of UOKiK reveals that udertakings are fully aware of the fact that it is prohibited to jointly fix the terms of submitted bids. Over 80% of respondents stated that such conduct constitutes a prohibited and competition-restricting agreement. When asked about a particular example – rotary submission of offers, 62% of the surveyed also rightly stated that such practice is contrary to law. The declaration of undertakings indicates the tendency that undertakings are not willing to involve in bid rigging. When asked if under the threat of bankruptcy they would partcipate in a tender collusion, only slightly more than 13% responded positively.

The survey results clearly demonstrate that the majority of undertakings is aware of the fact that bid rigging is prohibited. Consequently, there raises the question – Why do they decide to enter into prohibited agreements? The participants of conference “Competition protection in public procurement” being held today at the Faculty of Law and Administration, Nicolaus Copernicus University in Toruń will try to respond to the posed questions. The core objective of the meeting is working out possibly best ways of enhancing the effectiveness of detecting and eliminating tender collusions. The conference will be attended by Małgorzata Krasnodębska-Tomkiel, the President of UOKiK, representatives of ordering parties, contractors as well as authorities responsible for exercising control over the legality of tender procedures - Organization for Economic Co-operation and Development, European competition protection authorities, representatives of public institutions, lawyers and entrepreneurs. – The effective protection of competition in the field of public procurement is highly ranked among the priorities of antimonopoly authorities and it constitutes one of key topics for discussions raised at the international arena – stated Małgorzata Krasnodębska-Tomkiel, the President of UOKiK when starting the conference.

Today’s meeting constitutes a consecutive regional conference held by UOKiK aimed at presenting the actions by the Branch Offices of UOKiK and bringing closer the effects of their work. The Branch Office in Bydgoszcz is one out of nine regional units of the Office of Competition and Consumer Protection

The on-line transmission of the event is available at the Office’s website. Please find there also the record of the International Competition Law Forum, held in Warsaw on 27^th September 2012.

Today’s meeting constitutes a consecutive regional conference held by UOKiK aimed at presenting the actions by the Branch Offices of UOKiK and bringing closer the effects of their work. The Branch Office in Bydgoszcz is one out of nine regional units of the Office of Competition and Consumer Protection. It exemines and eliminates irregularities in the territory of Kujawsko-Pomorskie and Warmińsko-Mazurskie voivodeships. It has issued over 300 decisions since 2002, including the detection of a collusion between PZU and Maximus Broker on the insurance services market. Furthermore, the Branch Office in Bydgoszcz drew up a report concerning the protection of consumers on the air freight market. The report was published in May this year, in connection with the EURO 2012 championships.

Presentations:

• Presentation: Marcos Garcia (2012.10.12) [EN]
• Presentation: Laszlo Bak (2012.10.12) [EN]
• Presentation: Katarzyna Karasiewicz (2012.10.12) [PL]
• Presentation: Hanna Witt (2012.10.12) [EN]
• Presentation: Dorota Karczewska (2012.10.12) [PL]
• Presentation: Christof Vollmer (2012.10.12) [EN]
• Presentation: Antonio Capobianco (2012.10.12) [EN]
• Presentation: Małgorzata Stręciwilk (2012.10.12) [PL]
• Presentation: Agata Zawłocka-Turno (2012.10.12) [PL]

Additional information for the media:
Małgorzata Cieloch, Spokesperson for UOKiK
Department of International Relations and Communication
Pl. Powstańców Warszawy 1, 00-950 Warszawa
Phone: +48 22 827 28 92, 55 60 106, 55 60 314
Fax: +48 22 826 11 86
E-mail: [SCODE]bWFsZ29yemF0YS5jaWVsb2NoQHVva2lrLmdvdi5wbA==[ECODE]

* The research by commision of UOKiK concerning the knowledge of competition law in Poland. The survey was conducted from March to May, 2012. It covered 1200 undertakings in total, divided into four groups, giving employment respectively to: 9, 10-49, 50-249, and over 250 persons.