Losing bidders found complicit in flood control bid-rigging to face fines — PCC

Apart from the winning contractors, losing bidders found to be complicit in alleged bid-rigging in government flood control projects might also be slapped with fines and penalties, according to the Philippine Competition Commission (PCC).

At a press briefing in Manila on Thursday, PCC chairman Michael Aguinaldo said the anti-trust watchdog is now looking into establishing the supposed connections or “agreements” between competing bidders in the bid-rigging cases referred by the Department of Public Works and Highways (DPWH) early this month. 

“It’s undergoing investigation and evidence-gathering,” Aguinaldo said.

“Bid-rigging involves an agreement between competitors, between bidders so there has to be an agreement between the bidders… We’re working on establishing those connections. So we’re working with the DPWH, we’re also working with ICI (Independent Commission for Infrastructure),” the PCC chairman said.

Early in October, the DPWH filed bid-rigging cases against Wawao Builders, IM Construction Corporation, SYMS Construction Trading, St. Timothy Construction Corporation and officials and employees of the DPWH Bulacan 1st District Engineering Office and another against Sunwest, Inc. as well as officials and employees of the DPWH Regional Office IV-B.

Asked if losing bidders would be fined as well, Aguinaldo explained, “What the law penalizes is the agreement among bidders… so they [losing bidders] can also be part of the fine.”

On Wednesday, Ombudsman Jesus Crispin "Boying" Remulla claimed that even losing bidders make huge profits, getting about 3% of a project’s cost. 

Administrative fines

Under the Philippine Competition Act (PCA), entities found to have engaged in anti-competitive agreements such as bid-rigging may face administrative fines.

For the first offense, the fine would be up to P110 million. For the second offense, the fine ranges from P110 million to P275 million.

For the third and succeeding offenses, the fine increases to a range of P165 million to P275 million.

Aguinaldo said the anti-competitive cases in relation to the flood control projects “are priority for the PCC.”

The PCC chief said the fines to be imposed against those found guilty of bid-rigging could be “indirectly” a way of getting the people’s money back, apart from forfeiture and restitution.

Aguinaldo and Public Works Secretary Vince Dizon signed a a memorandum of agreement to strengthen inter-agency coordination in promoting fair competition and integrity in public procurement and infrastructure development in a bid to deter anti-competitive practices such as bid-rigging of public infrastructure contracts.

The agreement establishes mechanisms for case referrals, joint investigations, policy coordination, and capacity-building programs.

Under the agreement, both agencies commit to timely notification of relevant concerns, proactive monitoring of market conduct, and collaborative review of DPWH policies to ensure alignment with the PCA, the National Competition Policy, and other applicable laws.

The accord also enables the formation of joint task forces and logistical support for investigations, including access to procurement data and field coordination.

“The agreement between the PCC and the DPWH represents a shared commitment to make our public infrastructure not only strong and resilient, but also fair, transparent, and competitive,” said Aguinaldo.

“This is a first of its kind in terms of public infrastructure, where the DPWH has signed a long-term agreement with PCC in order to safeguard the people’s money and also recover the people’s money from any anomalous contracts that have been entered into as a result of rigged procurement activities,” Dizon said. — RSJ, GMA Integrated News