Bid Rigging in Procurement Law 2026

Bid rigging: unlawful collusion between bidders to manipulate award procedures – competition law, procurement law and criminal law consequences.

Definition: Bid rigging is an unlawful agreement or concerted practice between several bidders that manipulates competition in an award procedure, for example by coordinating bids, designating one bidder as the winner or having other bidders deliberately submit inflated bids to secure the award for the agreed winner.

Last updated: January 2026 · Legal basis: Art. 101 TFEU, § 1 GWB, § 1 KartG (Austria), § 298 StGB (Germany), § 168b StGB (Austria), Directive 2014/24/EU Art. 57 para. 4 lit. d

Concept and Forms

Bid rigging is the most serious form of competition failure in public procurement and causes annual damages amounting to billions for public contracting authorities throughout Europe. It is internationally known as "bid rigging" and can occur in various forms:

Bid rotation: bidders agree to alternate award wins across different procurement procedures.
Market allocation: bidders divide contracting authorities or geographic markets among themselves.
Cover bidding / complementary bidding: other bidders deliberately submit inflated bids so that the agreed bidder receives the award.
Bid suppression: bidders refrain from submitting a bid or withdraw their bid in order to secure the award for a particular bidder.
Subcontracting as consideration: the winner undertakes to award parts of the contract to unsuccessful cartel members.

Legal Qualification

Competition Law

Bid rigging violates Art. 101 para. 1 TFEU and the national cartel prohibitions (§ 1 GWB; § 1 KartG). They are considered hardcore violations for which an exemption under Art. 101 para. 3 TFEU is excluded. The competition authorities (European Commission, Federal Cartel Office, Federal Competition Authority) can impose substantial fines (up to 10 % of worldwide annual turnover).

Criminal Law

In Germany, bid rigging is regulated as an independent criminal offence in § 298 StGB (Anti-competitive agreements in tenders). The penalty is up to five years' imprisonment or a fine. In Austria, bid rigging can be prosecuted as fraud (§ 146 StGB) or as a cartel-law violation (§ 168b StGB new).

Procurement Law

Under procurement law, participation in bid rigging entitles the contracting authority to exclude the bidder from the ongoing award procedure and from future procedures for an appropriate period. Art. 57 para. 4 lit. d of Directive 2014/24/EU provides for optional exclusion on reasonable suspicion of anti-competitive collusion. In Austria and Germany, corresponding grounds for exclusion are implemented in the national procurement laws.

Detection of Bid Rigging

Contracting authorities should be alert to the following warning signs:

All bids received are very close together.
A bidder withdraws their bid shortly before the deadline expires.
The same group of companies always bids in the same market segment.
The cheapest bid is significantly more expensive than the contracting authority's estimate.
One of the bids contains errors suggesting coordination (identical wording, identical calculation errors).

Legal Consequences

The legal consequences of bid rigging are multi-faceted:

Nullity of the contract (§ 138 BGB; § 879 ABGB)
Damages liability of the cartel members towards the contracting authority
Fine payments by the participating companies
Criminal prosecution of the responsible persons
Exclusion from future award procedures (debarment)

Leniency Programmes

In Germany and at EU level, there are leniency programmes that grant companies that are the first to disclose collusion immunity from or reduction of fines. This is an important instrument for uncovering cartels.

Related Terms

FAQ

How can a contracting authority prove bid rigging? Proof is difficult in practice, since collusion is mostly covert. Indications can be identical wording in bids, unusual price patterns or statements by leniency applicants. The contracting authority is entitled to exclude on reasonable suspicion; the bidder must then prove that no collusion took place (self-cleaning).

Can an excluded bidder participate in award procedures again? Yes, through self-cleaning: the company can demonstrate through active cooperation with authorities, internal measures and compensation for damage that it has fundamentally changed.

How long does exclusion for bid rigging last? Under EU law, up to three years after the commission of the act or after a final conviction. National implementations may provide for deviating periods.

Last updated: January 2026 All information is provided without guarantee. For legally binding advice, please consult a law firm specialising in procurement law.