Fair Trade Commission Issues 'Corrective Orders and Fines' to 6 Companies for Bid Rigging in Sewer Pipe Procurement by Public Institutions

[Sejong=Asia Economy Reporter Joo Sang-don] The Fair Trade Commission has decided to impose corrective orders and a total fine of 890 million KRW on six businesses, including Dobong Concrete, for colluding in bids for sewer pipe purchases conducted by public institutions such as the Public Procurement Service.

According to the Fair Trade Commission, seven businesses?Dobong Concrete, Dobongsan Industry, Dongyang Concrete Industry, Aekyung Regicon (closed on December 31, 2019), Yujeong Regicon, Daewon Concrete, and Hanil Construction Materials Industry?agreed in advance on the winning bidders, cover bidders, and bid rates in 243 sewer pipe purchase bids conducted by public institutions including the Public Procurement Service from February 2012 to November 2017, and executed these agreements.

The winning bidders were decided at sales staff meetings or representative meetings of the Korea Resin Pipe Business Cooperative. The other businesses, aside from the winning bidders, participated as cover bidders when requested by the winning bidders to cooperate in securing the bid.

Accordingly, when the client issued a bid announcement, the winning bidders informed the cover bidders of their bid rates in advance via phone or other means and requested cover cooperation. The cover bidders then submitted bids higher than those of the winning bidders.

As a result, contracts were signed for 236 out of the 243 sewer pipe purchase bids. The average winning bid rate reached 97.9%.

The Fair Trade Commission decided to issue corrective orders to six companies excluding the closed Aekyung Regicon among the seven participants in the collusion, and to impose a total fine of 890 million KRW on five companies excluding Hanil Construction Materials Industry, which participated as a simple cover bidder in only one bid.

A Fair Trade Commission official stated, "By detecting and sanctioning the long-term secret bid-rigging activities in the sewer pipe purchase bid market ordered by public institutions such as the Public Procurement Service, we expect to establish competitive order in related bids in the future and contribute to saving national budgets. We will continue to closely monitor public bids to prevent collusion and take strict measures through prompt investigations if signs of collusion are found."

This content was produced with the assistance of AI translation services.