Won Hee-ryong "Considering Sanctions and Recovery Measures for Construction Companies with Swarm Bidding"

Controversy Over Some Construction Companies Sweeping Public Land Bids

Minister of Land, Infrastructure and Transport Won Hee-ryong is responding to questions from lawmakers at the Budget and Accounts Committee held at the National Assembly on the 29th.

On the 29th, Won Hee-ryong, Minister of Land, Infrastructure and Transport, expressed his intention to simultaneously consider sanctions and recovery measures regarding the issue of certain construction companies winning public land bids through 'swarm bidding.'

At the Budget and Accounts Special Committee held at the National Assembly that day, Minister Won responded to a question from Kang Min-guk, a member of the People Power Party who pointed out the harms of 'swarm bidding,' saying, "Along with overall system improvements, we must also consider sanctions or recovery measures for the problematic lots."

'Swarm bidding' refers to a method where numerous disguised affiliated companies participate in bids to increase the chances of winning.

According to the 'LH Public Land Swarm Bidding Related Company Winning Status' data submitted by the Ministry of Land and LH to Assemblyman Kang, during the Moon Jae-in administration period (2017-2021), five construction companies?Hoban Construction, Daebang Construction, Junghung Construction, Woomi Construction, and Jeil Construction?won 67 out of 178 lots (37%) through 'swarm bidding.' There have been ongoing criticisms that swarm bidding undermines fair competition in the construction market and increases market inefficiency.

Minister Won stated, "In 2021, we introduced a competitive evaluation method instead of a lottery, but the problem has not been fundamentally resolved, so we have been conducting a full investigation this year."

The full investigation revealed that out of 101 winning lots, 71 were not used directly for projects, and 10 were found to be paper companies.

Minister Won said, "Along with establishing fundamental systems, we are devising fundamental sanctions for the lots already acquired through swarm bidding, as these lots have not yet been resold."

Assemblyman Kang Min-guk said, "While the Ministry of Land has made only superficial system improvements for years, excusing itself by saying it lacks authority for punishment and investigation, these companies have grown infinitely, and the construction market economy has fallen into chaos. It is necessary to establish definite recurrence prevention measures, such as limiting multiple affiliated companies from participating en masse in bids with a 'one company, one lot' rule."

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