Commerce Commission to educate businesses about potential competition issues in Christchurch rebuild
19 October 2012
The Commerce Commission plans to meet with key people involved in the Christchurch rebuild to ensure competition law is not bent or broken during the rebuilding of the city.
“Billions of dollars are at stake in the Christchurch rebuild. Overseas experience has shown that there is considerable potential for fraud and collusion as money begins to flow in the reconstruction phase. Our aim is to educate organisations and businesses involved in the rebuild so that they have a good understanding of how the Commerce Act applies to them,” said Commerce Commission Chair Dr Mark Berry.
The sorts of illegal practices the Commission hopes to head off with this education initiative include inflated invoicing, bid rigging, and price fixing.
“Christchurch will be a key area for economic activity and growth for the New Zealand economy for up to the next ten years, so this is not only important to Christchurch but to the nation as a whole,” said Dr Berry.
Over the next few months the Commission will be meeting with those people who have a key role in procurement functions and activities for the Christchurch rebuild. This includes: insurance companies; the Insurance Council; EQC; associations for loss adjusters and quantity surveyors; Christchurch City Council; CERA; and others.
The goal of the project is to foster good procurement and tendering practices which will help ensure healthy competition during the Christchurch rebuild and deliver value for money.
“Our goal is to increase awareness and understanding of competition and consumer laws, and to prevent anti-competitive behaviour. In particular, we want to prevent collusive practices such as bid rigging. We want key stakeholders to be able to recognise and report such practices should they occur,” said Dr Berry.
The Christchurch initiative is part of the Commission’s focus on increasing education to raise awareness of the benefits of competition and through this, raise compliance with competition and consumer laws.
Bid rigging or collusive tendering, occurs when there is an agreement among some or all of the bidders as to which of them should win a bid.
The Commission has fact sheets available on our website that explain how to recognise bid rigging and how to deter bid rigging.