Singapore

Three water feature maintenance firms fined for cartel-style bid-rigging

They had exchanged information, coordinated submissions for maintenance of pools, spas and fountains

Three water feature maintenance companies have been fined by the competition watchdog for conducting cartel-style bid-rigging activities for close to a decade.

CU Water Services, Crystalene Product (S) and Crystal Clear Contractor had exchanged information and coordinated their bids for maintenance services for swimming pools, spas, fountains and other water features at developments such as hotels and condominiums.

The illegal bid rigging concerned 521 contracts and 220 customers, and took place between August 2008 and June 2017. Some of the customers included hotels such as Shangri-La and Grand Copthorne Waterfront, as well as management corporations and managing agents of condominiums.

The Competition and Consumer Commission of Singapore (CCCS) fined CU Water $308,680. Crystalene and Crystal Clear were fined $41,541 and $68,793 respectively after receiving a "leniency discount" to have their penalties reduced because they came forth to share information on the cases.

The watchdog began looking into the three companies after a tip-off by a whistleblower in July 2017.

It served the companies with legal documents in March this year to say they illegally rigged their bids in tenders called by privately owned developments.

Instead of submitting tender bids independently, one company would request a supporting quotation from another, which it believed would be higher than its own. The second company would then give the higher quotation to the customer. At times, one company would specify a price for the other to use in the supporting quotation.

These arrangements meant the firms were able to submit higher quotations across the board. There was no competitive pressure to submit their best offers to the customers, said the watchdog. Customers were unable to obtain offers that best met their requirements and provided the best value, it added.

Tenders affected by arrangements between CU Water and Crystalene were called from Oct 11, 2008, to May 29, 2017, while those affected by agreements between CU Water and Crystal Clear were called from Aug 20, 2011, to June 16, 2017.

CCCS chief executive Sia Aik Kor said: "Bid-rigging is one of the most harmful types of anti-competitive conduct as it distorts the competitive bidding process, thereby preventing customers from getting the best value for their tenders."

Ms Sia added that any business approached to join anti-competitive agreements should reject the approach and publicly distance itself from any such discussions. She urged businesses involved in a cartel to consider making a leniency application as soon as possible.


Information in this article has been amended.

COURT & CRIME