ICN experts exchanged experience of countering bid-rigging

It is necessary to create and maintain conditions for pro-competitive vector of the parties involved in public procurement

The programme of the Conference of the International Competition Network (ICN) included a session on “Engaging public and private partners in deterrence: the case of bid-rigging in public procurement”. Vladimir Kachalin, an assistant to Head of FAS made a report about the experience of the Federal Antimonopoly Service.

He discussed stakeholders in public procurement, first of all: government agencies and state-run corporations; suppliers – both incumbents of the market of public procurement as well as new entrants; regulators and law enforcement bodies (FAS, the Audit Chamber, the General Prosecutor’s Office, the Ministry of Interior, federal and local authorities, etc.); NGOs, for example, the People’ Front or “OPORA RUSSIA”; politicians and legislators, the community, mass media.

Vladimir Kachalin pointed out that under particular circumstances and depending on their interests, the above parties may act to the benefit of competition on the market of public procurement as well as against it, which enables multidirectional intervention in public procurement at different levels: from determining the public procurement rules (legislators, government officials) to their practical execution (staff of the bodies that place procurement orders, regulators, suppliers).

In this context it is necessary to create and maintain conditions to support in general pro-competitive vector of actions of the parties involved in public procurement. Such conditions are formed through enforcement of the Law on procurement (FZ-44), first of all, as a result of using electronic auctions and trading sites. Using them achieves the following conditions for pro-competitive conduct of bidders at tenders and auctions:

- Transparency (access to the main part of information on public procurement in an open system with access to the Internet)

- Streamlining and enhancing efficiency of “scanning” public procurement markets (both market structure and conduct of economic entities) and as a consequence exposing bid-rigging; an electronic auction system (bids are filed in e-form, bidders do not know about each other)

- Considering complaints about tenders and auctions within five days; access of the society, mass media, NGOs to information about tenders and, as a consequence, creating conditions for control from their part; an open system of planning and placing orders in procurement; open qualifying requirements to suppliers.

Finally, Vladimir Kachalin discussed differences between countries in building up public procurement: from centralized to decentralized systems as well as systems with a higher or lesser degree of implementing e-procedures and interdepartmental unification. He characterized public procurement in Russia under those characteristics.

Other session attendees included George Ferreira (Portugal Competition Authority), Daniel Wilcox (Canada Competition Bureau), Vinicius Marques de Carvalho (ex-head of Brazil competition authority).