In detail: the CMA's increased focus 

For a number of years, the Competition and Markets Authority (CMA) has been considering ways to detect and take action against those involved in bid-rigging. In 2017, it launched a software tool to fight bid-rigging, which utilised an algorithm to spot unusual behaviour and pricing patterns, indicating bid-rigging may have taken place. 

It is estimated that the UK public procurement sector is worth c.£290 billion, a third of all public expenditure. The OECD estimates that the presence of bid-rigging inflates prices by 20%. The CMA views bid-rigging as a key risk in public sector procurement; it recently imposed fines of nearly £60m on 10 companies for such conduct. The CMA works closely with public procurers to spot suspicious behaviour, with enforcement communications reaching approximately 80,000 public sector officials so far. Additionally, in its draft Action Plan for 2025/26, the CMA outlined its intention to focus on utilising AI to detect and address instances of bid-rigging.

Legislative change: the Procurement Act 2023

The Procurement Act 2023 (PA 2023) also presents an opportunity for the CMA and contracting authorities to take action against bid-rigging. A new, centrally held, debarment list will prevent suppliers who have been found guilty of bid-rigging from competing in public procurement processes and being awarded public contracts. More on this regime is detailed below. 

But first: what is bid-rigging?

Bid-rigging is a form of collusion through which suppliers agree to limit competition in a procurement process preventing competition and denying buyers a fair price. It can be orchestrated in different ways including:

• Bid suppression – where one or more suppliers agree not to bid, or withdraw their bid
• Bid rotation – where suppliers take it in turns to submit the lowest bid 
• Cover pricing – suppliers arrange for one or more of them to submit an artificially high bid, distorting the public authority's impression of the competitive price. 

Ongoing CMA activity in this area

In December 2024, the CMA launched an investigation into suspected bid-rigging in relation to suppliers providing roofing and construction services (including building and technical suppliers) to schools through the government's Condition Improvement Fund awarded annually by the Department for Education. Previously, investigatory work by the CMA led to the imposition of fines close to £60m on 10 companies for illegal collusion on bids related to demolition and asbestos removal contracts. 

Speaking with the Financial Times, the CMA's Chief Executive, Sarah Cardell, warned of the danger of bid rigging and revealed that the CMA had been trialling a new AI tool to combat bid-rigging in public procurement. The CEO revealed that initial tests with an unnamed government department had proved "quite successful". The tool works by scraping large amounts of bidding data to identify anomalies indicative of suspicious behaviour. Building on this momentum, the CMA has indicated that developing AI tools to tackle illegal collusion will be a key focus of its draft Action Plan for 2025/26. 

Impact of the PA 2023 

The PA 2023 entered into force on 24 February 2025. It brings together different sets of regulations and will apply to public contracts, utility contracts, concession contracts, and defence and security public contracts.
Suppliers or their connected persons (i.e. persons with significant control), who engage in collusion can be excluded by a contracting authority from participating in a public procurement process, being awarded a public contract or, in certain circumstances, may have a public contract terminated.

Mandatory grounds for exclusion are: 

• being convicted of: (i) a cartel offence (such as bid-rigging);[1]  (ii) an ancillary offence, which includes aiding, abetting, or inciting the commission of an offence; or (iii) substantially similar offence(s) committed outside of the UK; 
• if the CMA has made a decision finding a competition law infringement in respect of a supplier or connected person (or a substantially similar offence outside of the UK).

There are also discretionary exclusion grounds where a contracting authority considers that: 

• a supplier or connected person is party to conduct that breaches (i) competition law (including bid-rigging) or (ii) a substantially similar prohibition outside of the UK;
• the supplier or a connected person is engaged in conduct constituting a criminal cartel offence [2] (or a substantially similar offence outside the UK).

Each contracting authority when running a public procurement process will consider whether any of the mandatory or discretionary exclusion grounds apply, which may result in the supplier being excluded. 

Consequences of exclusion 

Where a contracting authority excludes a supplier on the basis of a mandatory or discretionary exclusion ground, they are under an obligation to report this to a Minister of the Crown via the Procurement Review Unit (PRU), which sits within the Cabinet Office. The PRU will investigate the matter and subject to the supplier's right to appeal, can place a supplier on the centrally published debarment list for up to 5 years. Where a supplier is placed on the debarment list, this will mean that they will not be eligible to participate in public procurement processes for the period that they are on the debarment list. 

The debarment list is public and accessible by any contracting authority; it is expected it will be checked by contracting authorities during public procurement processes. Accordingly, being placed on a debarment list could result in a supplier either being prohibited from being awarded a public contract or having been awarded a public contract, such contract being terminated. 

However, if as a result of an investigation, the PRU decides not to place a supplier on the debarment list, they will be eligible to participate in any future public procurement process.  Each contracting authority will continue to consider the mandatory and discretionary exclusion grounds and if any apply at that time, that may result in the supplier being excluded, the matter being referred to the PRU for a separate investigation. 

Suppliers: steps towards compliance 

As set out above, the CMA has demonstrated its willingness to take enforcement action in the public procurement market. Its appetite in this area is likely to continue with the expansion of its investigatory powers under the Digital Markets, Competition and Consumer Act 2024 (DMCCA 2024). Whilst the prohibition of bid-rigging is nothing new, it remains vitally important that suppliers are cognisant of how they interact with their competitors, understanding where to draw the line between competitive collaboration and anticompetitive collusion. Ensuring competition compliance policies and dawn raid guides are up to date is a simple step suppliers should now be taking ensure they stay on the right side of competition law. 

Suppliers should ensure that competition law compliance programmes are effective and up to date. More generally, suppliers should (i) familiarise themselves with the changes brought about by the PA 2023, including the debarment regime; (ii) provide accurate information when bidding for public contracts; (iii) co-operate with contracting authorities and provide information promptly (iv) conduct due diligence on their supply chain as it may contribute to a supplier's exclusion; (v) act promptly if there are concerns about bidding conduct – including if an investigation is launched which may result in the supplier being placed on the debarment list.