Collusion
Glossary of procurement terminology, A guide for suppliers, Published by the London Borough of Richmond upon Thames in April 2012, suggests that collusion is: ‘A fraudulent arrangement between two or more parties whereby prices or service requirements are manipulated to get round competitive tendering.’
As part of a selective tendering process, tenderers may be required to complete a ‘Declaration of Non-Collusion’ (sometimes referred to as a ‘Declaration of Non-Collusion Form’ or a ‘Certificate of Non-Collusion’). This is intended to prevent corruption in the tender process by requiring a declaration from the tenderer that they have not colluded with any other party in the preparation of their tender.
For more information see: Declaration of non-collusion.
NB The Chartered Institute of Procurement & Supply (CIPS) Glossary of procurement terms, defines collusion as: ‘Where two or more potential suppliers (or the purchaser and one or more suppliers) secretly co-operate to undermine the competitiveness of a tender process.’
Public procurement toolbox, terminology, published by the Organisation for Economic Co-operation and Development (OECD), states: ‘Collusion involves a horizontal relationship between bidders in a public procurement, who conspire to remove the element of competition from the process by raising or fixing the prices and reducing output in order to increase profits. Bid rigging is the typical mechanism of collusion in public contracts. (see Bid rigging).’
[edit] Related articles on Designing Buildings
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- Construction contract.
- Contract award.
- Contract negotiation.
- Cover pricing.
- Declaration of non-collusion.
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