This article is from the Australian Property Journal archive
CHIEF watchdog, the Australian Competition and Consumer Commission, has launched civil proceedings against ARM Architecture and its former managing director Anthony (Tony) John Allen, alleging they engaged in cartel conduct by attempting to rig bids for the tender for a $250 million education precinct.
In 2018, Charles Darwin University announced plans for a new $250 million Education and Community Precinct in the heart of the Darwin CBD which would be primarily funded by the federal government and the university. ARM Architecture was awarded the contract for principal design and consultant services under the first phase of the project after a tender in May 2019.
In September 2020, the tender for the second phase of the Charles Darwin University project was issued. The ACCC alleges that following the issue of the tender, Allen sent emails to eight other architectural firms requesting them not to submit a bid for the second phase of the Charles Darwin University project.
The ACCC alleges that in doing so ARM Architecture, through the conduct of Allen, attempted to rig or induce other competitors to agree to rig the tender for principal design consultant services. The ACCC also alleges that Allen attempted to induce other competitors to agree to rig this tender.
Once Charles Darwin University became aware of the alleged conduct, ARM Architecture was excluded from consideration for the second phase of the building project, which was valued at about $2.6 million plus GST.
ACCC Chair Gina Cass-Gottlieb said bid rigging for tenders, whether the tenders take place in the public or private sector, is against the law.
“This type of cartel conduct increases the costs of tenders for businesses or taxpayers, and has a chilling effect on competition.
“Professional services firms, including architects, should note that Australia’s cartel laws apply to their businesses as they do in other sectors. Firms competing in these markets must compete fairly and ensure they do not engage in anti-competitive behaviour, including cartel conduct,” she added.
“Public sector procurement is a multi-billion-dollar sector. It makes a vital contribution to the Australian economy and the welfare of Australians, who have the right to expect competitive bidding for these projects, resulting in value for money,” Cass-Gottlieb said.
In November 2021, the ACCC issued a warning to public sector agencies to be alert to the potential of bid rigging for public sector tenders and report any collusive activity to the ACCC.
This year the ACCC has launched an outreach program aimed at engaging with public sector procurement officials regarding the risk and indicators of cartel conduct in procurement processes.
“We are continuing to engage with public sector procurement officials at the local, state and federal levels to increase their awareness of potential anti-competitive conduct in public sector contracting, to enable early detection of this conduct,” she continued.
The ACCC is seeking declarations, pecuniary penalties and costs, as well as orders for compliance training against the architecture firm. The case will be listed before the Federal Court at a date to be set.
