CCI bats for compliance in public procurement
To ensure competition-compliant public procurement and concerned by growing instances of bid rigging/collusion, the Competition Commission of India (CCI) wants alignment of the existing procedures for public procurement with competition laws.
CCI also wants close cooperation among various stakeholders, such as the department of expenditure, central vigilance commission, comptroller & auditor general, CCI and large procurers like defence and railways, for the long-term development of competitive public procurement markets.
CCI said it wants auditors in government departments to sensitise themselves with anti-competitive practices. CCI has stressed on increasing competition in public procurement, but has pointed to its own recent orders where it had to impose penalty on violators.
In an internal communication, CCI has pointed that bid rigging in public procurement can cause serious economic harm as it increases prices artificially, lowers quality and leads to loss of taxpayers' money.
In India, Section 3 of the Competition Act, 2002, identifies bid rigging/collusive bidding as one of the horizontal agreements that could adversely impact competition in the concerned market and, hence, prohibits it. The commission has imposed severe penalty in several instances in recent times.
In the last few months, CCI has found violations in procurements and fined several companies like LPG Manufacturers (R165.59 crore), Aluminium Phosphide Tablet Manufacturers (R317.91 crore), among others.
In the communication, CCI chairman Ashok Chawla said the government, as a procurer, has substantial 'buyer power', which must be used for the benefit of the public at large and not to the
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