MyCC fines 8 IT firms RM1.55m for bid-rigging govt contracts

 

Eight local IT companies have been slapped with fines totalling RM1.55 million for involvement in bid-rigging activities in government contracts, according to the Malaysian Competition Commission (MyCC).

This involved four different information technology-related projects worth RM1.93 million by the National Academy of Arts, Culture and Heritage of Malaysia (Aswara), said MyCC chief executive officer Iskandar Ismail.

At a press conference today, he said MyCC initiated an investigation into the bid-rigging cartels following complaints from Aswara in early 2017.

Iskandar said Aswara grew suspicious of price-fixing after it found a company that lost the bid turning up on behalf of a company that secured the contract worth RM468,000 in 2016.

He said the representative of Tuah Packet Sdn Bhd, which lost in the bid, showed up at a kick-off meeting by Aswara despite the fact that Caliber Interconnects Sdn Bhd won the contract.

MyCC chief executive officer Iskandar Ismail

Tuah Packet’s representative subsequently made the technical presentation to Aswara on behalf of Caliber.

“The commission then commenced an investigation under Section 15 of the Competition Act 2010 to ascertain whether there is an infringement of Section 4 of the same Act,” he said.

Companies sharing documents

Iskandar said the commission discovered other companies were also involved in bid-rigging activities.

While noting that Novatis, Silver Tech, Venture Nucleus and Basenet did not win in tender, the MyCC CEO said they were found to have equally violated the Competition Act as they participated in the 2016 contract.

Iskandar said these companies shared confidential company documents such as letterheads, financial documents, Construction Industry Development Board (CIDB) and Finance Ministry certificates, and company stamps with each other.

MyCC also found that Tuah Packet and Aliran Digital colluded with each other on a project worth RM939,852 in 2015,, even though both of them did not secure the project.

Iskandar said the commission found Tuah Packet and Aliran Didigal were also involved in similar bid-rigging for two other projects worth RM475,000 and RM42,786.90, respectively.

Tuah Packet was fined RM224,589.13, while a RM301,822.45 fine has been imposed on Caliber Interconnects.

Other companies slapped with fines are Aliran Digital Sdn Bhd (32,471.26), Viamed Sdn Bhd (RM 95,512.17), Novatis Resources Sdn Bhd (RM414,829.38), Silver Tech Synergy Sdn Bhd (RM14,836.26), Venture Nucleus (M) Sdn Bhd (RM 320,848.46) and Basenet Technology Sdn Bhd (RM143,283.24).

Iskandar noted that the commission needed five years to conclude this case.

“This is because we (are the agency that) investigates, hears the case, makes a ruling and imposes a penalty. We don’t go to the court because we are the court,” he said.

Iskandar urged the relevant government agencies to blacklist or suspend these companies or individuals involved for five years in accordance with the government’s latest circular.

He said bid-rigging activities could result in losses between 20 and 30 percent of the expenditure for the relevant projects.

Currently, MyCC is probing some 500 companies suspected of being involved in rigging the bidding process of 20 contracts worth RM2 billion across all sectors. - Mkini