Fair tendering onus on designers too
The DIA has a longstanding position that governments and organisations using tendering processes will get better outcomes if they value the design process and plan to pay fairly for creative concepts.
The flip side of this is that DIA members should always maintain professional standards while they participate in tender processes.
A recent Australian Competition & Consumer Commission (ACCC) case is a good reminder that upholding professionalism doesn’t just relate to quality design processes. Designers need to be aware of the rules around how they operate their businesses that ensure that customers get a fair go. There are strict rules in Australia that stop unfair practices intended to reduce competition, such as a group of businesses agreeing to use the same prices.
Recently, the ACCC investigated the behaviour of some architecture businesses invited to bid for work through a tendering process. As a result they have initiated legal proceedings claiming that one practice engaged in illegal conduct by asking its competitors to decline to bid, with the aim of being the successful tenderer. The practice, ARM Architecture, had previously been commissioned for the first stage which involved provision of principal design consultant services for the master plan, business case, concept plan and scheme design phase of the project. The tender for the second stage was for principal design consultant services for the design development, construction documentation, construction and defect liability period phases of the project.
In the context of this tender being the second stage of a project where the architectural practice had completed the first stage, designers may relate to the logic of wanting to continue a project. However, this anti-competitive behaviour is taken seriously. The Chair of the ACCC Gina Cass-Gottlieb, warned ‘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.’
In this case, the behaviour is classed by the ACCC as bid rigging, where ‘two or more competitors agree they will not compete genuinely with each other for tenders, allowing one of the cartel members to ‘win’ the tender. Participants in a bid rigging cartel may take turns to be the ‘winner’ by agreeing about the way they submit tenders, including some competitors agreeing not to tender.’ Information on bid rigging can be found on the ACCC’s website.
Anyone with information about cartel conduct, including in the construction industry, is urged to call the ACCC Cartel Hotline on (02) 9230 3894. You can also report cartel conduct anonymously.
Anyone who thinks they may be involved in cartel conduct can also apply for immunity from prosecution in exchange for helping with the ACCC’s investigations by contacting the ACCC.
Denise Ryan
DIA Senior Policy Adviser