Egypt's Competition Authority (ECA) has referred two general contracting companies to the Public Prosecution for allegedly colluding on tenders to reinforce Red Sea television broadcast towers. The ECA found that the two firms had coordinated to divide the areas offered in these practices, violating the country's competition law. This case marks the latest instance of the antitrust watchdog pursuing companies suspected of dividing public tenders among themselves.
The competition protection law in Egypt bars coordination between competing firms over whether to submit or withdraw from tenders, auctions, and other government supply offers. The ECA's investigation, which began with a report from the National Media Authority, found evidence of coordination between the two companies to prearrange which one would win the contract. The authority has decided to file a criminal case against the two firms and notify the Public Prosecution.
The ECA has also notified the two companies to immediately halt any explicit or implicit agreement, understanding, or coordination to submit or withhold bids in tenders, auctions, and other public procurement offers. Collusion in contracts awarded by public bodies is considered one of the most serious violations under the competition law, as it undermines equal opportunity among bidders, harms public funds, and denies state agencies the best price and quality for goods and services.
The practice of collusion in public tenders is a form of horizontal-agreement crime criminalized under Article 6(c) of the competition law. The ECA, chaired by Mahmoud Momtaz, is mandated to protect competition across public and private contracts under the Competition Protection and Anti-Monopoly Practices Law. The authority has previously upheld a referral to the prosecutor of carpet manufacturer Oriental Weavers over an exclusive-distribution case.
The National Media Authority, which oversees state radio and television infrastructure, including transmission towers, reported the suspected collusion to the ECA. Three bodies regulate Egypt's broadcast media under the 2014 constitution: the Supreme Council for Media Regulation, the National Press Authority, and the National Media Authority. The ECA's actions aim to promote fair competition and protect public interests.
The ECA's decision to refer the two contractors to prosecution demonstrates its commitment to enforcing the competition law and preventing anti-competitive practices. The authority's efforts to promote competition and transparency in public procurement are crucial for ensuring that government bodies receive fair pricing and that smaller bidders have an equal chance to compete.
The case highlights the importance of the ECA's role in safeguarding competition and preventing collusion in public tenders. The authority's actions will help to promote a fair and competitive business environment in Egypt, ultimately benefiting the public interest.
Key points
- The Egyptian Competition Authority referred two contractors to prosecution for colluding on tenders to reinforce Red Sea television broadcast towers.
- The competition law in Egypt bars coordination between competing firms over tenders, auctions, and other government supply offers.
- The ECA's actions aim to promote fair competition, protect public interests, and prevent anti-competitive practices.
