Preventing "Blind" Bidding: Public Procurement Service Requires Deposit from Habitual Eligibility Screening Withdrawals

Participants in public procurement eligibility evaluations will now be required to pay a bid deposit. This measure aims to prevent so-called "blind" bidding, where participants habitually withdraw after entering the eligibility screening process.

The Public Procurement Service announced on the 30th that it has revised the "Regulations on Domestic Procurement Operations of the Public Procurement Service" to reflect these changes.

This revision was implemented to prevent indiscriminate participation in bids for the supply of goods, which are conducted through eligibility screening under the National Contract Act. Previously, participants could withdraw from the evaluation process without facing any penalties, and this loophole was being exploited.

With this revision, from now on, any participant who fails to submit eligibility screening documents five or more times, or withdraws from the evaluation process in bids subject to the National Contract Act within one year from the bid announcement date, will be classified as a habitual eligibility screening withdrawal participant. Such participants will be required to pay a deposit of at least 2.5% of the bid amount when participating in future bids.

However, the Public Procurement Service plans to introduce a grace period to allow sufficient time for participants to become aware of the new rules and for the system to be smoothly established. Full implementation of the deposit requirement is scheduled to begin in 2027.

Kang Seongmin, Director of the Procurement Business Bureau, stated, "We expect that the revised regulations will help reduce the number of companies that indiscriminately participate in bids and then refuse or avoid the eligibility screening stage. The Public Procurement Service will continue to work to prevent 'blind' bid participation in the public procurement market and to establish a sound order of transactions."