1. Press Release C. 26-12
El Salvador, October 8th, 2012.
CS launched toolkit
“Competition and Public Procurement”
The Competition Superintendence (CS) launched a toolkit to promote competition in public
procurement processes and optimize the State´s expenditures. In El Salvador, for the last 7 years,
public purchases have represented, in average, 2.7% of the GIP; thus, promoting competition in these
procedures to make public expenditures more efficient is relevant for economic development.
“In its Competition The CS launched the toolkit “Competition and Public Procurement:
Advocacy activities, Promoting Competition in these Processes to Optimize Public
the CS seeks to train Expenditure”, seeking to promote competition principles in public
the public procurement procurement procedures and support public institutions in the prevention
and timely detection of collusion in the aforementioned processes.
offices in order to
prevent future damages The launching event was inaugurated by the Competition Superintendent,
to competition caused Francisco Diaz Rodriguez, and by the Chief of the Public Administration
by bid rigging in public Procurement Unit of the Ministry of Finance (hereinafter, UNAC, its acronym in
procurement Spanish). During said event, more than 100 public procurement head officers
processes”, asserted were trained on how to adopt competition principles in the public tenders and
Francisco Diaz timely detect bid rigging through cases solved and opinions issued by the CS.
Rodriguez, Competition Best practices for the acquisition of goods and services were also explained.
Superintendent.
Bid rigging is an agreement amongst competitors in a public procurement
process carried out to fraudulently manipulate the bids. Said manipulation
may be executed as price fixation, market allocation, or allocation of the
public institutions that carry out these processes.
This type of agreement harms competition in public procurement procedures. On one hand, the State is a buyer
of goods and services in order carry out its duties and obligations; consequently it is negatively affected by bid
rigging due to the fact that this anticompetitive practice makes it difficult to obtain excellent quality goods and
services at the best prices. On the other hand, the population is also negatively affected by these agreements
because public purchases are paid with money coming from taxes. In case of bid rigging, the people´s taxes pay
the illegal profits attained by bid riggers.
The OCDE studies estimate that as a consequence of bid rigging, prices of goods and services may increase up
to 20%. This is why agreements amongst competitors are considered one of the most harmful practices for the
national economy as a whole.
The Salvadoran Competition Law forbids these agreements:
“Art. 25.- Anticompetitive practices among competitors are prohibited, these practices include the following,
amongst others:

2. c) Fix or limit prices at auctions or in any other form private or public bidding, national or international ,
with the exception of the joint bids submitted by economic agents that are clearly identified as such in the
documents submitted by the bidders;”.
Competition should be one of the main principles governing public procurement processes. Pursuant to the
Salvadoran Public Procurement Law (LACAP, its acronym in El Salvador), competition is the governing principle
in these processes. The existence of competition amongst bidders in public procurement procedures is the only
way to guarantee a variety of options and allows the Public Administration to choose the most adequate bid in
accordance to its needs.
Background
In July 2009, the CS sanctioned four travel agencies for bid rigging in public tenders of the Ministry of Economy
and of the Tourism Salvadoran Corporation. These bidders agreed to offer the same commission to issue
airplane tickets. The fines imposed totaled US$21,325.50.
In November 2009, the CS launched the toolkit “Detecting and Preventing Bid Rigging in Public Procurement
Processes”. This document guides the public officers in charge of public acquisitions and purchases on how to
prevent and detect bid rigging in El Salvador.