Bid Rotation

A form of collusion in which a relatively stable set of bidders for contracts which are routinely awarded to the lowest bidder collude between themselves as to which of the bidders should win which contract. For example, bidder A may submit the lowest bid for contracts let over a particular time period or for a particular scope of work. The other bidders will deliberately inflate their bids on the express understanding that their turn will come. On the expiry of their turn, bidder A will inflate their subsequent bid in order for it to become bidder B’s turn to win the contracts. Bid rotation relies upon a relatively stable community of bidders, regular tenders and predictable behaviour by the buyer. See also Collusion.