Collusion

eLesson 2

What is collusion?

What is the correct definition of collusion?

A secret arrangement to gain an unfair advantage. When two or more people reach a secret agreement to influence something or to deceive others. Examples include trying to influence a tender or showing favoritism to a particular bidder or company for a contract. This also covers conflicts of interest. This is when, for example, family or personal connections result in an unfair and uncompetitive tender process.

Stealing, diverting or counterfeiting health products. For example, taking drugs from the public health system to sell privately for profit resulting in free drugs being denied to patients. This can also result in sub-standard or counterfeit health commodities being sold in pharmacies and markets.

The misuse or abuse of power for private gain. Examples include giving or receiving a bribe or a kickback, paying an official to win or asking for money to award a contract, offering or accepting excessive gifts or hospitality to influence a decision.

eLesson on Collusion:

4 mins left

Why should you care about collusion?

Collusion between suppliers is not permitted by the Global Fund

It reduces fair competition and drives up the prices of medicines and health products

It discourages honest, qualified suppliers from participating in Global Fund grant activities

It facilitates the supply of sub-standard health products

It prevents Global Fund programs from achieving full impact

eLesson on Collusion:

3 mins left

eLesson on Collusion:

4 mins left

How do you spot collusion?

Collusion can have the following red flags:

The same suppliers wins multiple contracts

Unexplained increase in product prices

Decrease in product quality

Complaints of unfair competition from losing bidders

Anonymous or employee complaints about buyer and vendors

Qualified suppliers refrain from bidding

Closed bidding and using unapproved vendors

Contract awards rotate among the same group of suppliers

Similar-looking bids from different suppliers; bids with the same mathematical or spelling errors

Similar address, phone numbers and email between bidders

The winning bidder is always the last one to bid

Favorable treatment given to a particular bidder as compared to others

Subjective technical selection procedures and disqualifications

No penalties for delivery delays or faulty products

Bidders are prevented from competing for unfair reasons

Losing bids are poorly prepared or missing basic bid documentation

Information exchange between bidders

Standardisation of prices suggested by different bidders

Losing bidder hired as sub-contractors

eLesson on Collusion:

5 mins left

Case study on collusion

Read a case study about collusion from the Office of the Inspector General archives