20 December 2024

(View Media Release in PDF)

1. The Competition and Consumer Commission of Singapore (“CCCS”) has issued an Infringement Decision^[1] today against Flex Connect Pte Ltd (formerly known as Facility Link Pte Ltd) (“FL”) and Tarkus Interiors Pte Ltd (“Tarkus”) (each a “Party” and collectively the “Parties”) for infringing the Competition Act 2004^[2]. FL and Tarkus provide interior decoration and finishing works and are amongst only a limited pool of firms able to undertake high value contracts.^[3] After extensive investigations by CCCS, the Parties have been found to have engaged in bid-rigging conduct relating to several tenders for interior fit-out construction services in non-residential properties across Singapore.

CCCS’s Investigations

2. CCCS’s investigations commenced in November 2020. A raid at the Parties’ business premises was subsequently conducted, during which digital evidence was seized, including images of hard disks and copies of WhatsApp chats. The investigations revealed numerous instances of bid-rigging conduct^[4] between the Parties in tenders called by project managers/consultants or end-customers.

3. Bid-rigging is one of the most serious infringements of competition law, both in Singapore as well as internationally. The bid-rigging conduct by the Parties affected 12 separate tenders across Singapore, involving different establishments such as retail spaces, food and beverage outlets, and offices.^[5] The affected tenders were between $187,000 and $7,700,000 in value, with a total value of approximately $34,110,000. The conduct occurred over a five-year period, from August 2016 to August 2021. The bid-rigging conduct typically involved one of the Parties, who was designated as the winner, providing bid pricing and other details to the other Party, who would then submit a bid at a higher price so as to give the designated winner a better prospect of winning the tender.

4. CCCS found that the bid-rigging conduct eliminated the competitive pressure between the Parties to submit their best offers to potential customers. As a result of the conduct, potential customers were not able to receive truly competitive offers from the Parties, thus potentially overpaying for these tenders. While the Parties sought to justify their bid-rigging conduct, for example, by claiming that they were at risk of being excluded from future tenders if they declined to participate in a tender, CCCS found this did not justify the Parties’ collusive conduct. The Parties’ collusive conduct effectively reduced the number of shortlisted tenderers genuinely competing and gave customers the false appearance of competition for their tenders. 

5. As part of the legal process under the Competition Act 2004, CCCS issued a Proposed Infringement Decision^[6] to the Parties on 23 May 2024. CCCS received written representations from each of the Parties’ lawyers, and carefully considered the Parties’ representations before finally reaching CCCS’s Infringement Decision.

Financial Penalties

6. In levying financial penalties, CCCS considered various factors, including each business’ relevant turnover, the nature and seriousness of the infringement and aggravating and mitigating factors. As FL had in the course of the initial investigations applied for and was granted leniency, CCCS reduced its financial penalty by applying a leniency discount to its penalty. CCCS’s leniency programme affords lenient treatment to businesses or individuals that are part of a cartel agreement or concerted practice, when they come forward early to CCCS with information on their cartel activities.

7. CCCS has imposed the following financial penalties on the Parties:

8. Chief Executive of CCCS, Mr. Alvin Koh said: “Bid-rigging is a serious infringement of Singapore’s competition laws that harms both businesses and consumers. It distorts the competitive bidding process, drives up prices and deprives customers from getting the best value for their tenders. Ultimately, the Singapore consumer and society pays. To ensure our markets work well, CCCS will take firm action if we find that tenderers are colluding or participating in any anti-competitive discussions.”

9. “CCCS advises any businesses approached to participate in anti-competitive agreements to immediately refuse and publicly distance itself from such discussions. For businesses currently involved in a cartel, CCCS’s leniency programme^[7] offers an opportunity for businesses to come forward to receive a full waiver or reductions of the financial penalty,” he added.

10. Further information on the investigation, analysis of the case and the calculation of financial penalties imposed on the Parties are set out in the Infringement Decision here.