This presentation summarises the findings of this 2018 OECD report on procurement rules and regulations in Mexico's Electricity Federal Commission (CFE) and makes policy recommendations to promote competition and fight bid rigging in accordance with international best practices. The full report available in English and Spanish can be downloaded at oe.cd/fbrmex.

1. Fighting bid rigging in
Mexico
A review of CFE
procurement rules
and practices

2. Why fight bid rigging?
Bid rigging involves groups of firms conspiring to raise
prices or lower the quality of the goods or services offered
in public tenders.
Although illegal, this anti-competitive practice is
widespread and costs governments and taxpayers across
the world billions of dollars every year.
Mexico has partnered with the OECD to improve its
procurement practices and step up its fight against bid
rigging in several public entities.

3. Fighting bid rigging and the OECD
2012 OECD
Council
Recommendation
and
2009 Guidelines
on Fighting Bid
Rigging in Public
Procurement

4. Lessons learned in OECD projects
to fight bid rigging
• Successful collaborations require high-level
commitment, sufficient resources and a willingness to
be open.
• Commitments must be long-term.
• Procurement officials are eager to be part of the
solution.
• Training and education of public procurement officials
is necessary and pays immediate dividends.
• Recommendations to procurement agencies must be
tailored to them.
• Implementation plans are critical. 4

5. CFE-OECD Partnership
Energy reform opens the electricity sector to competition.
First co-operation agreement between the OECD and CFE
to review procurement processes.
A new CFE law includes rules that aim to render
procurements more efficient and effective.
OECD completes its first analytical report and makes
recommendations.
Second cooperation agreement between the OECD and
CFE to review procurement processes.
CFE’s new procurement regime enters into force
OECD completes its second analytical report and makes
recommendations. 5
2013
2014
2015
2016
2017
2018

6. Some positive developments
• market studies, which are the main source of information to make decisions
about purchases, have been reinforced. For instance, with the creation of a
unit devoted to conduct market studies.
• Possibility of greater participation of foreign bidders.
• Use of electronic means for most of the stages of the contracting process.
• There is still room for improvement…
• The criteria for choosing to conduct a full-fletched market investigation
should take into account bid rigging risks or the level of competition.
• CFE uses many exceptions to open tender procedures.
• Exceptions to the use of electronic procedures should be limited.
The OECD recommendations are focused on addressing the limitations of
CFE’s procurement regime.
6
Key findings about CFE’s
procurement

7. 32 recommendations to CFE
• Use full-fledged market investigations, in particular when the level of
competition is low or past collusive behaviour has been observed.
• Open procurement: less exceptions to public bids; more foreign
bidders; less joint bids and subcontracts
• Maximise the use of E-procurement
• Limit the use of split awards
• Comprehensive procurement database; accessible for Competition
Authorities
• Mechanism to report anonymously bid rigging
• No disclosure of the identity of all bidders to everyone
• Regular training on collusion for procurement officials
7

8. Statistical
Highlights

9. Use of international and national open
tenders in terms of volume
2012-2016
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015 2016
National open tender International open tender

10. Use of international and national open
tenders in terms of value
2012-2016
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015 2016
National open tender International open tender

11. Use of different types of contractual
procedures by volume
2012-2016
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015 2016
Open tender Restricted invitation Direct award

12. Use of different types of contractual
procedures by value
2012-2016
0%
10%
20%
30%
40%
50%
60%
70%
80%
2012 2013 2014 2015 2016
Open tender Restricted invitation Direct award

13. Fighting bid rigging in Mexico
A review of CFE
procurement rules
and practices
Access the full report and
view more work on the
Mexican-OECD partnership
to fight bid rigging at:
oe.cd/fbrmex