Islamabad: CCP fines five firms for ‘collusive’ Pesco bidding
ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed a sum of Rs10 million as penalty on five companies for engaging in collusive bidding in a tender of Peshawar Electric Supply Company (Pesco).
The CCP issued its decision regarding the alleged collusive bidding in a Pesco tender, concluding that five undertakings violated Section 4 of the CCP Act, 2010 by participating in a collusive bidding arrangement in a 2009 tenders.
The CCP imposed Rs10 million fine on the five undertakings namely, Nam International (Pvt) Limited, Amin Brothers Engineering (Pvt) Limited, Creative Engineering (Pvt) Limited, Electric Concern (Pvt) Limited, and Redco Pakistan Limited for the violation. The order has been issued after the conclusion of the hearing into the matter by a two-member bench of CCP comprising Abdul Ghaffar, Member (C&TA) and Dr Joseph Wilson, Member (MA&IA).
Earlier, the CCP conducted a suo moto inquiry into the matter after the review of historical data related to Pesco’s tenders raised suspicion of collusive bidding in a particular tender numbered ADB-PESCO-06-2009 LOT III for the procurement of 4759 High Tension Pre-stressed Concrete and 3678 Low Tension Pre-stressed Concrete poles.
The inquiry was completed vide a report dated 21 July 2010, which concluded that the abovementioned five undertakings had collusively bid for the tender. The inquiry found that out of the five undertakings, four entered into a joint venture agreement to collectively bid for the tender, while the fifth submitted a cover bid to give the impression of competitive bidding. On the recommendation of the report, CCP issued show cause notices to the five undertakings on August 2, 2010.
Collusive bidding is an area of priority enforcement for the CCP. This case is the third instance where CCP has taken strict action against undertakings involved in collusive bidding. Prior to this case, CCP imposed a fine of Rs23 million and Rs200 million on jute manufacturers and deep sea dredging firms respectively for collusive bidding.