The ACCC has issued a warning on cartel conduct risk in public sector tenders.

The competition regulator says public sector agencies must be alert to the potential for collusion between bidders during procurement processes.

Public sector procurement is a multi-billion-dollar sector, however, based on recent experiences, the ACCC is concerned that some public servants and businesses may not be sufficiently aware of the risk of breaching cartel laws during the procurement process.

“Cartel conduct by businesses tendering in a public sector procurement process is illegal, just as such conduct is illegal in the context of a private sector tender,” ACCC Chair Rod Sims says.

“Encouraging businesses to discuss their bids with each other, or to make agreements about who will bid for a particular tender, is likely to amount to cartel conduct which is against the law.

“Cartel activities may start with a small encouragement or an innocent remark, but this can create an environment that enables, condones or facilitates collusive conduct between competing firms. 

“Competition to supply governments with goods and services is crucial in ensuring value for money for taxpayers. Cartel conduct in government procurement is therefore not only against the law, but will often result in taxpayers paying considerably more for goods and services,” Mr Sims said.

The ACCC says procurement professionals should familiarise themselves with the ACCC guide on cartel deterrence and detection.

“It is also important for prospective bidders to be aware of their obligations and comply with the law,” Mr Sims said.

“We encourage public sector procurement professionals to proactively review their procurement processes and identify and remedy any potentially anti-competitive elements in any procurement procedures, policies or guidelines.”