Date: 18.6.2026
What happened?
The Malaysia Competition Commission, commonly known as MyCC, has issued a Proposed Decision against six enterprises for alleged involvement in bid rigging in relation to a food supply tender issued by the National Anti-Drugs Agency, or AADK.
The tender was reported to have a procurement value of MYR5.7 million. MyCC’s provisional finding is that the six enterprises may have engaged in conduct that restricted competition in the tender process. The alleged conduct involved information sharing and collusion during the preparation and submission of tender bids in relation to a food supply tender issued by a government agency, AADK.
MyCC has provisionally found that the enterprises infringed Section 4(1), read together with sections 4(2)(d) and 4(3), of the Competition Act 2010 Malaysia. These provisions deal with anti-competitive agreements, including bid rigging.
At this stage, the Proposed Decision is not a final finding of infringement. The enterprises may submit written representations and make oral representations before MyCC issues any Final Decision.
For Malaysian businesses, this development is important. It shows that bid rigging remains a key enforcement focus for MyCC, particularly in public procurement and tender-based industries.
What Malaysian Businesses Should Know About Bid Rigging and the Malaysia Competition Act 2010
A proposed decision is issued by MyCC part of MyCC’s enforcement process. It reflects MyCC’s provisional findings based on its investigation, but it does not mean that the enterprises have been finally found liable. Under Section 36 of the Competition Act 2010, the enterprises are entitled to comment on the proposed decision before MyCC decides whether to issue a Final Decision.
The alleged infringement of the Competition Act 2010 relates to bid rigging, which is considered by MyCC as one of the most serious forms of cartel conduct under Competition Act 2010. In general terms, bid rigging occurs when bidders or competitors coordinate their conduct in a tender process instead of competing or submitting bids independently.
This may include bidders or competitors agreeing among themselves who should win a tender, coordinating bid prices, taking turns to win contracts, agreeing not to bid, submitting intentionally weak bids or sharing commercially sensitive information during the tender process.
The key issue is whether the tender process has been distorted because bidders did not act independently.
Why bid rigging matters under the Malaysia Competition Act 2010
Chapter 1 of the Malaysia Competition Act 2010 prohibits anti-competitive agreements between enterprises. Section 4(1) of the Malaysia Competition Act 2010 prohibits horizontal or vertical agreements that have the object or effect of significantly preventing, restricting or distorting competition in any market for goods or services. Section 4(2) of the Malaysia Competition Act 2010 identifies agreements that restricts competition by object, including bid rigging. Where an agreement between competitors has the object of bid rigging, it is deemed to have significant anti-competitive effect on the relevant market.
A tender is intended to allow the buyer to compare independent bids from different suppliers. If competitors coordinate their bids, the buyer may be deprived of genuine competition. This may lead to higher prices, poorer value, reduced quality or less innovation.
For companies, the risk of infringing Competition Act 2010 can be serious. An enterprise found to have infringed the Competition Act 2010 Malaysia may face financial penalties of up to 10% of its worldwide turnover, reputational damage, business disruption and follow-on consequences in future tenders.
How bid rigging risk can arise
Many businesses understand that competitors should not agree on prices. However, bid rigging risk can arise in less obvious ways.
Competition law issues or bid rigging risk may arise if competitors:
- discuss whether they intend to participate in a tender;
- exchange information on proposed bid prices;
- agree that one party will submit the lowest bid;
- agree that another party will submit a higher or weaker bid;
- take turns to win tenders;
- agree not to bid so that another competitor can win;
- share cost structures, margins or tender strategy;
- coordinate through a consultant, agent or subcontractor; or
- submit bids that appear independent but were in fact coordinated.
These arrangements do not need to be recorded in a formal contract. Risk may arise from emails, calls, WhatsApp, messages, meetings, shared spreadsheets, informal understandings or conduct that suggests coordination.
A short conversation with a competitor before a tender submission can create serious exposure if it involves commercially sensitive information.
What this means for businesses participating in tenders
For businesses that participate in public or private tenders, the practical point is straightforward: tender participation must be handled independently.
Competition law risk does not only arise from board-level agreements or formal pricing decisions. It can arise at the tender preparation and submission stage. This is especially relevant where employees, agents, distributors, consultants, subcontractors or business partners are involved in the tender process.
A company may face risk if its employees coordinate with competitors, even if senior management was not directly involved. A company may also face risk if an external consultant or agent acts as a channel for sharing sensitive information between bidders.
Businesses should therefore avoid treating tender submissions as routine administrative exercises. Tender conduct should be part of the company’s wider competition compliance framework.
This is particularly important for businesses that regularly participate in government procurement, GLC tenders, statutory body tenders, institutional tenders, construction tenders, facilities management
Public procurement and MyCC enforcement focus
Public procurement is often a focus area for competition authorities because it involves public funds, essential services and large procurement values. Where bid rigging occurs in public procurement, the impact may go beyond the immediate tender. It can affect value for money, public trust, service delivery and market confidence. For this reason, public procurement cases often attract greater regulatory and reputational attention.
The latest MyCC Proposed Decision relating to the AADK food supply tender reflects the continuing importance of competition compliance in both public and private procurement.
What boards and senior management should consider
For boards and senior management, the key question is whether the business can demonstrate that its tender submissions are prepared independently and supported by proper internal controls. Boards and senior management play an important role in setting the tone for competition compliance. In tender-driven businesses, competition law risk should be treated as a governance issue, not merely a legal issue. Directors and management should understand how tender decisions are made, who is involved and whether there are appropriate safeguards.
Key questions include:
- Does the company have a competition compliance policy?
- Does the policy specifically address bid rigging and tender conduct?
- Are tender teams trained on what they can and cannot discuss with competitors?
- Are communications with competitors monitored or controlled?
- Is there a clear escalation process for suspicious competitor approaches?
- Are agents and consultants subject to competition compliance obligations?
- Are tender decisions documented properly?
- Are high-value or high-risk tenders reviewed by legal or compliance teams?
These questions are particularly important for companies that depend heavily on public procurement or repeat tender opportunities.
Red flags that businesses should watch for
Businesses should pay close attention to warning signs that may suggest bid rigging or tender coordination risk. Common red flags include:
- A competitor asking whether your company intends to submit a bid.
- A competitor suggesting that your company should not participate in a tender.
- A competitor asking for your proposed price or pricing assumptions.
- A competitor offering to share its own bid price.
- A supplier, agent or consultant appearing to coordinate multiple bidders.
- Similar bid documents, pricing formats or errors appearing across competing bids.
- Repeated tender outcomes where competitors appear to take turns winning.
- Internal emails referring to understandings with competitors.
Not every red flag proves wrongdoing. However, these indicators should not be ignored altogether. They should be taken seriously and escalated to legal or compliance teams for further review.
Concluding remarks
MyCC’s Proposed Decision against six enterprises in relation to the AADK food supply tender is another reminder that bid rigging remains a key enforcement priority in Malaysia.
Businesses do not need to wait for an investigation before reviewing their practices. Businesses that regularly participate in tenders should take this opportunity to review their tender practices, update competition compliance policies and ensure that employees understand the risks of bid rigging under the Competition Act 2010 Malaysia. Early preventive steps can reduce risk and help the business demonstrate that it takes compliance seriously.
This is particularly important for businesses operating in sectors where tenders are frequent, competitive and commercially significant. A strong compliance framework should not only address what employees cannot do, but also provide practical guidance on how bids should be prepared, approved and documented. Clear internal controls, proper escalation channels and regular training can help tender teams identify red flags early and respond appropriately. For boards and senior management, the focus should be on building a culture where independent decision-making is expected, recorded and consistently reinforced across the business.
This alert is authored by our Managing Partner, Ms. Nicole Leong. The views and opinions expressed in this alert are those of the authors’ alone and do not constitute any legal advice. For further information or advice on Competition Law and Antitrust, kindly contact Ms. Nicole Leong.