ACCC v DRS C3 Systems Inc - Government Procurement and Anti-Competitive Conduct

In an important reminder that government departments and agencies can easily be the target of anti-competitive arrangements, a US-based defence technology company has recently admitted to engaging in collusive tendering in contravention of the competition law provisions of the Trade Practices Act 1974 (Cth) (Australian Competition and Consumer Commission v DRS C3 Systems Inc NSD588/2009, orders made by Edmonds J on 5 February 2010). The conduct related to a procurement project of the Commonwealth Department of Defence (Defence).

DRS C3 Systems Inc (DRS) entered into an arrangement with its competitor, Cubic Defence Applications Inc (Cubic), in relation to a Defence procurement project for an air combat manoeuvring instrumentation system. DRS and Cubic agreed that DRS would withdraw from the procurement, increasing Cubic's prospects of securing the Defence contract. DRS then gave effect to that agreement by actually withdrawing.