A bid-rigging in public procurement proceedings

The Serbian Competition Commission initiated an infringement investigation

On 20 April 2023, the Commission for the Protection of the Competition (“Commission”) initiated one more infringement investigation and carried out a dawn raid, this time against KTG Solucije d.o.o. Subotica (“KTG”) and Eco-Sense doo Subotica (“Eco Sense”) for possible RPM (resale price maintenance) and sharing of markets or source of supply in public procurement proceedings related to the materials and means for maintaining hygiene in facilities.

In cooperation with the Public Procurement Office, as well as based on publicly available data on the Public Procurement Portal, the Commission found out that KTG, as a bidder in several public procurement procedures, withdrawn its bids, so that the contracting authority had to conclude agreements with the second-ranked bidder Eco-Sense, but at higher prices than those offered by KTG.

In addition to withdrawing bids in certain public procurement procedures, acting in accordance with the 2022 Guidelines for the detection of rigged bids, the Commission conducted an analysis of the IP addresses (Internet Protocol addresses) from which KTG and Eco Sense accessed the Public Procurement Portal and found out that both companies almost always accessed from identical IP address, as well as from devices that were connected through the same Internet network or possibly through the same device.

The Commission characterized this behavior as a restrictive practice – a joint performance of bidders KTG and Eco Sense, which directly led to RPM and sharing of markets or source of supply i.e., to a violation of competition rules from Article 10 of the Law on Protection of Competition.

This is the first infringement investigation of the Commission regarding public procurement in the last three years, confirming our earlier articles in which it is stated that the Commission has increased its activities and continued with its focus on RPM.

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