The collusion detection in public procurements – selected methods applied for the road construction industry in Poland

Foremny, Andrzej; Anysz, Hubert

doi:10.1051/matecconf/201821904002

Cited by 5 publications

(5 citation statements)

References 8 publications

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“…Such a solution would make it possible for regulatory offices to quickly determine a group which should be put under scrutiny and to assign appropriate operational resources for the purpose of more precise examination. The theory of fuzzy sets can be successfully used for the classification of road construction tenders following the criterion of the possibility of anti-competitive agreement occurrence, which is presented in paper [4].…”

Section: Discussionmentioning

confidence: 99%

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Review of collusion and bid rigging detection methods in the construction industry

Foremny¹

2018

Creative Construction Conference 2018 - Proceedings

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Collusion and bid rigging are deplorable practices, forbidden by law. They are harmful to the society and dangerous for a free market economy. Due to the high value of construction industry production and the importance of the time factor, anti-competitive behaviour in that sector can result in losses extremely significant for the national economy. Effective elimination of cartels and bid rigging requires detection, prosecution and successful penalization of cartels. Disrupting already existing cartels and deterring new ones from emerging is efficient only when there is an effective cooperation between the three above mentioned stages. Classification and brief description of numerous existing collusion and bid rigging methods were performed in this paper. As a conclusion, the author presents an idea to combine AI (Artificial Intelligence) and BIM (Building Information Modeling) together as useful tools for early detection of collusion and bid rigging in public tenders.

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Section: Discussionmentioning

confidence: 99%

“…Implementing artificial intelligence into construction industry might allow for detection of abnormalities, classification of phenomena (i.a. anti-competitive agreements) [4,5] or prediction of delays [6,7]. In this paper, the author provided an overview of the existing methods of anti-competitive agreement detection.…”

Section: Main Textmentioning

confidence: 99%

Review of collusion and bid rigging detection methods in the construction industry

Foremny¹

2018

Creative Construction Conference 2018 - Proceedings

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“…Another important factor that can pay a client's attention to the possibility of bid rigging is the range of the prices offered. The range was defined (Foremny and Anysz, 2018) as:…”

Section: Narrow Range Of the Bid Pricesmentioning

confidence: 99%

Client’s Expectations vs Contractor’s Pricing. Fair Prices or Bid Rigging

Anysz¹,

Foremny²

2020

XV International Conference on Durability of Building Materials and Components. eBook of Proceedings

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The road construction sector is a specific part of the construction industry. It happens very rarely that a section of a road is financed also by a private entity. The other factor distinguishing it-is a significant value of road construction contracts. The Client's estimates of the value of the prospective contracts have to be based on the market prices in case of public procurement. However, this market is dominated by public orders. There is no comparison to the value of works ordered on the private part of the construction market, which is found more efficient by economists. Widely applied the "design and build" type of orders make the comparisons of the unit prices more difficult. The huge differences between the Client's estimates and the winning prices in the road construction public tender procedures are the bases of speculations about the fairness of the procedures. These differences can have a varied origin. There are several reasons for them e.g. varied contractor's risk, the size of the structure, type of order, the dynamics of the road construction market. Nevertheless, fraudulent practices can make the winning price much higher than the Client's estimate. The article is an attempt to finding the limit i.e. what part of these differences can be explained by fair, market reasons. If the found limit is exceeded, it should make the Client carefully consider the offers placed. The analysis is based on collected data concerning almost 400 tender procedures for the sections of roads in Poland in 2014-2017.

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“…The problem of collusion and bid rigging has been a subject of many studies, i. a. [2][3][4][5][6][7][8][9][10]. Construction industry, including road construction is an important and capital-consuming branch of world economy.…”

Section: Introductionmentioning

confidence: 99%

“…Combinations of various methods prove most successful, i.a. scientific and economic studies [30], artificial intelligence [6][7][8], statistical analysis, hard evidence (e.g. wiretapping and surveillance), demonstrating factual losses of ordering parties, 'leniency' programmes.…”

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confidence: 99%

Collusion and bid rigging in the construction industry: case studies from Poland

Foremny¹,

Kulejewski²,

Anysz³

et al. 2018

Creative Construction Conference 2018 - Proceedings

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Polish economy experienced significant changes during the past 30 years. System transformation that began in the 1980's and was enhanced by Poland's entry to the European Union in 2004 significantly influenced economic development. Apart from tough history experiences, they formed the shape of national economy which can be observed nowadays. It was a long and difficult process. During political and economic rapid changes greater numbers of price collusions and other illegal practices can be observed than during the stable development of national economy. Authors selected and reviewed the most important anti-competitive cases in the construction industry from the past 30 years in Poland. The review includes not only cases that were officially justified and penalized-like the collusion of portland cement big producers-but also cases of collusion suspicion on highway and express roads that ended with acquittal court verdicts.

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The collusion detection in public procurements – selected methods applied for the road construction industry in Poland

Cited by 5 publications

References 8 publications

Review of collusion and bid rigging detection methods in the construction industry

Review of collusion and bid rigging detection methods in the construction industry

Client’s Expectations vs Contractor’s Pricing. Fair Prices or Bid Rigging

Collusion and bid rigging in the construction industry: case studies from Poland

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