Improving the island’s productivity by eliminating over pricing of bids and lengthy delays in project execution came into sharp focus, when the Fair Trading Commission (FTC), hosted a workshop for senior public officials to pin-point the characteristics of such activities.
Under the theme: Detecting, Mitigating and Fighting Bid-Rigging in Public Procurement, resource personnel from the FTC, along with retired Attorney and Organisation for Economic Cooporation and Development Expert in Competition Law (Public Procurement), Arnold Celnicker, outlined the nuances of bid-rigging and how to detect?? it during the seminar, which was held at the Savannah Hotel, Hastings, Christ Church, recently.
According to the FTC’s official guideline on the subject, bid-rigging is defined as "an anti-competitive agreement in which competing businesses seek to determine the outcome of a bidding process by agreeing among themselves, which of them will submit the winning bid, and which will not."??
Chairman of the FTC, Sir Neville Nicholls, noted that under the Fair Competition Act, the Commission, while seeking to promote competition, is required to investigate and to prohibit, all practices that disrupted or distorted competition in Barbados.
He explained: "These practices include abuse of a dominant position and anti-competitive agreements of which price-fixing, bid-rigging, tied selling and price discrimination, are specifically identified."
Even though the FTC had stepped-up its educational outreach since the introduction of the Competition Act, Sir Neville said?? it had also undertaken, a number of activities. These included: investigating and adjudicating anti-competitive conduct; educating and informing businesses and consumers; cooperating with CARICOM and its Member States and the Community Competition Commission, as well as cooperating with international agencies and competition authorities.
Underscoring the importance of the seminar, the FTC chairman outlined: "Government procurement usually involves significant outlays of government funds and, therefore, calls for proper management of budgetary allocations.?? Prudent management is compromised if they are inefficiencies in the procurement process.
"The management of government funds calls for accountability on the part of procurement officers, associated personnel and bidders.?? Therefore, a sound understanding of the principles involved in preventing and detecting bid-rigging can greatly assist procurement officials, in helping to eliminate the threat posed by such activity, to the integrity of the procurement process," Sir Neville underlined.
Regarding the department’s enforcement efforts, the FTC chairman disclosed that it had conducted 29 cases of alleged anti-competitive conduct?? this year as it related to allegations of abuse of dominance, namely the refusal to supply, excessive pricing and exclusive dealing. There were also five cases of anti-competitive agreements.
Meanwhile, Minister of Economic Affairs, Empowerment, Innovation, Trade, Industry and Commerce, Dr. David Estwick, maintained that anti-competitive practices such as price fixing, market division, bid rotation and other forms of collusion, were not only counter-productive to government’s expenditure objectives, they also led to over-spending, the delivery of poor goods and services to the public and other procurement inefficiencies.
Dr. Estwick noted that the proposed Procurement Modernisation Project would reduce government over-spending and over time, realise significant cost savings.
He observed: "The programme being launched this morning is one that aims to identify measures to eliminate activity that can negatively affect public procurement.?? It, therefore, fits well with Government’s overall objectives in this area."
In an era of robust austerity measures being implemented by governments worldwide, Dr. Estwick said: "we can ill-afford to become complacent in our attempts to eliminate mismanagement of government funds." jwilson@barbados.gov.bb