Guidance

Bid-rigging: advice for public sector procurers

Updated 20 June 2016

© Crown copyright 2016

This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives.gov.uk.

Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned.

This publication is available at https://www.gov.uk/government/publications/bid-rigging-advice-for-public-sector-procurers/bid-rigging-advice-for-public-sector-procurers

What is bid-rigging?

Bid-rigging is when suppliers agree to limit competition in the procurement process, thereby denying the customer a fair price. Bid-rigging agreements can take several forms, such as:

  • bid rotation – where firms agree to take it in turns to submit the lowest bid
  • bid suppression – where one or more firms agree not to bid, or to withdraw their bids
  • cover pricing – bidders arrange for one or more of them to submit an artificially high bid, distorting the procurer’s impression of the competitive price

Why public sector procurers should care about bid-rigging

Bid-rigging can cost the taxpayer money and can exclude potentially more efficient competitors from the bidding process.

It may also reduce suppliers’ incentives to improve quality or innovate.

How to spot suspicious bidding patterns

  • bids received at the same time or containing similar or unusual wording

  • different bids with identical prices

  • bids containing less detail than expected

  • the likely bidder failing to submit a bid

  • the lowest bidder not taking the contract

  • bids that drop on the entry of a new or infrequent bidder

  • the successful bidder later subcontracting work to a supplier that submitted a higher bid

  • expected discounts suddenly vanishing or other last minute changes

  • suspiciously high bids without logical cost differences (for example, delivery distances)

  • a bidder that betrays discussions with others or has knowledge of previous bids

What can public sector procurers do to reduce the risks of anti-competitive behaviour?

  • look for suspicious bidding patterns, and inform suppliers that you will be looking

  • consider requiring bidders to sign non-collusion clauses and/or certificates of independent bids

  • avoid tender list management that incentivises firms to bid even if they do not want the work

  • share experience with other public sector procurers

Bid-rigging can cost the taxpayer money. Stay aware to the possibility that your suppliers are rigging bids and report any suspicious behaviour to the CMA.

Report a cartel on the Cartels Hotline 020 3738 6888 or email Cartelshotline@cma.gov.uk

These materials do not constitute legal advice and should not be relied upon as such.

Back to top