Joint Bidding Arrangements With Competitors: Evaluating and Minimizing Antitrust Risks

Department of Justice investigations and lawsuits alleging bid rigging have become increasingly common. Although legitimate pro-competitive joint bidding arrangements are encouraged, there is a thin line between lawful joint bidding and illegal bid rigging. Antitrust counsel must understand the grey areas and potential legal pitfalls with joint bidding arrangements so they can appropriately advise their business clients.

Anti-competitive joint bidding schemes come in many forms, including making agreements with competitors not to bid, submitting token bids to give the appearance of competition, and alternating bids. To avoid even the appearance of engaging in bid rigging, companies participating in joint bidding arrangements should refrain from discussing bid terms with competitors, avoid making unrealistically high bids, avoid language that suggests unusual depth of knowledge of a competitor’s bid, and minimize sudden withdrawals of bids or changes in bid terms or conditions.

Further, counsel should remain alert for red flags that could indicate antitrust violations, such as questionable invoices or payments, suspicious bidding patterns, suspicious pricing patterns, and questionable conduct during negotiations, communications and information exchanges with competitors regarding joint bidding arrangements.

Listen as our authoritative panel discusses the antitrust risks with joint bidding arrangements with competitors and best practices for evaluating and minimizing liability exposure.