Corruption limits competition

Different forms of corruption can have an impact on public procurement and competition. It is not only a question of obvious bribery, which can involve money and valuable gifts or benefits. It may also be a matter of nepotism and conflicts of interest.

“Regardless of what form the corruption takes, it can facilitate or enable, and sometimes conceal or obstruct the discovery of a violation of the competition and procurement regulations. Corruption distorts competition and is harmful to both consumers and to competition,” says Rikard Jermsten, Director-General of the Swedish Competition Authority.

The Swedish Competition Authority’s experience shows that corruption can occur in all types of cases investigated by the Competition Authority, not only in procurements and cartels. The Competition Authority’s report describes different ways in which corruption may feature in the agency’s investigations, also providing hypothetical examples to illustrate.

The Swedish Competition Authority has also made an estimation of how often signs of corruption are seen in its supervisory work. In the cases of suspected violations of the Competition Act from last year, it is estimated that approximately 15–20 per cent have featured indications of corruption. In procurement cases, the proportion showing signs of corruption is estimated to be somewhat lower, between 5 and 10 per cent.

“Even if there is a great amount of uncertainty in these numbers, they still indicate that signs of corruption are not unusual. We will be more attentive to suspected corruption in the future and prioritise cases where we suspect such elements to be present,” says Rikard Jermsten.

The Swedish Competition Authority’s priority policy, which determines which cases lead to an investigation, has recently been updated. If there are signs of corruption in a suspected violation of the law, this must be weighed into the prioritisation.

Read the report, 2018:10 (in Swedish with a summary in English)