Hello, this is Attorney Young-kyung Lee of Cheongchul Law Firm.

The Korea Fair Trade Commission (KFTC) has announced that it will give administrative pre-announcement, for about 20 days from September 21 to October 12, 2026, of a proposed amendment to the Guidelines on Unfair Collaborative Acts in Bidding and Requests for Restriction of Bidding Eligibility (「입찰에 있어서의 부당한 공동행위 및 입찰참가자격 제한요청에 관한 지침」, the 'Guidelines'). The core of the proposed amendment is to substantially tighten the standards for requesting restriction of eligibility to participate in public tenders against enterprisers that have repeatedly taken part in cartels: it would extend the period used to determine repeat cartel conduct from 5 years to 10 years, broaden the penalty points taken into account from bid rigging to all types of cartels, and lower the penalty-point threshold for a restriction request from 'more than 5 points' to '4 points or more.' This means that an enterpriser could become subject to a request for restriction of bidding eligibility after receiving just two corrective orders, which is expected to lead to a real expansion of risk for companies participating in the public procurement market.

Cheongchul Law Firm is composed of attorneys specializing in fair trade law who have both represented the KFTC and had the legality of its dispositions upheld in court, and represented numerous companies in investigations, deliberations and litigation concerning bid rigging and unfair collaborative acts, as well as in responding to dispositions restricting bidding eligibility. This column is based on the KFTC's press reference material dated September 21, 2026.

The Proposed Amendment at a Glance – A Longer Look-Back Period for Repeat Cartels and a Stricter Restriction Request Threshold

The current Act on Contracts to Which the State Is a Party (「국가를 당사자로 하는 계약에 관한 법률」, the 'State Contracts Act') provides that, where the KFTC so requests, a procuring entity such as the Public Procurement Service may restrict the relevant enterpriser's eligibility to participate in tenders. Under the current Guidelines, the KFTC may request a restriction of bidding eligibility where the cumulative penalty points received for bid rigging over the past 5 years exceed 5 points; as repeated cartel conduct by certain enterprisers has recently become an issue, the KFTC is pursuing this amendment of the Guidelines in order to strengthen deterrence against violations. The key elements of the proposed amendment are ① changing the name and nature of the Guidelines, ② extending the period for determining repeat cartel conduct from 5 years to 10 years, ③ broadening the penalty points taken into account from bid rigging to all types of cartels, and ④ tightening the penalty-point threshold for a restriction request from 'more than 5 points' to '4 points or more.'

● Administrative pre-announcement period: September 21 – October 12, 2026 (about 20 days)

● Scheduled effective date: January 1, 2027

● Sunset date of the Guidelines: extended from June 30, 2027 to December 31, 2029

● Three key changes: ① period for determining repeat cartel conduct: 5 years → 10 years ② penalty points counted: bid rigging → all types of cartels ③ restriction request threshold: more than 5 points → 4 points or more

● Transitional measure: for enterprisers that received penalty points between January 1, 2022 and December 31, 2026, the former provisions apply to the first restriction request made on or before December 31, 2031

1. Background to the Amendment – The Problem of Ineffective Sanctions Against Repeat Cartels

The current Guidelines allow the KFTC to request that a procuring entity restrict bidding eligibility only where the cumulative total over the past 5 years of penalty points received for bid rigging (warning 0.5 points, corrective recommendation 1.0 point, corrective order 2.0 points, penalty surcharge 2.5 points, criminal referral 3.0 points) exceeds 5 points. Under this standard, however, even an enterpriser that repeatedly took part in cartels and had penalty surcharges imposed twice would have cumulative penalty points of exactly 5, failing to meet the 'more than 5 points' requirement and thus falling outside the scope of a restriction request. As repeated cartel conduct by certain enterprisers has continued to be an issue, the KFTC has moved to amend the Guidelines in the direction of strengthening requests for restriction of bidding eligibility against repeat cartel participants, in order to enhance deterrence against violations.

2. Key Contents of the Proposed Amendment

Change of the Guidelines' Name and Nature – Comprehensively Governing Restriction Request Standards as Well

The proposed amendment changes the name of the Guidelines from the Guidelines for Examination of Unfair Collaborative Acts in Bidding (「입찰에 있어서의 부당한 공동행위 심사지침」) to the Guidelines on Unfair Collaborative Acts in Bidding and Requests for Restriction of Bidding Eligibility (「입찰에 있어서의 부당한 공동행위 및 입찰참가자격 제한요청에 관한 지침」). This reflects an expansion of their nature: in addition to the existing function of examination guidelines that set out the types of bid rigging and the examination standards, they would become guidelines that comprehensively govern the standards for requesting restriction of bidding eligibility based on all types of cartels.

Longer Period for Determining Repeat Cartel Conduct – From 5 Years to 10 Years

The period over which cumulative penalty points are calculated, which serves as the basis for a request for restriction of bidding eligibility, would be extended from the former 5 years to 10 years. The period is calculated backward up to 10 years from the date of the KFTC's corrective measure regarding the bid rigging in question, with the first day included. As the period doubles, cartel history from further in the past could be included in determining whether the conduct is repeated.

Broader Scope of Penalty Points – From Bid Rigging to All Types of Cartels

Previously, only penalty points received for bid rigging were counted toward the cumulative total; once amended, all penalty points arising from violations of Monopoly Regulation and Fair Trade Act Article 40(1) (공정거래법 제40조 제1항) (unfair collaborative acts in general) would be taken into account. In other words, a record of other types of cartels that are not bid rigging, such as price cartels and volume cartels, would also be reflected in the decision on whether to request a restriction of bidding eligibility.

Stricter Penalty-Point Threshold for Restriction Requests – From 'More Than 5 Points' to '4 Points or More'

The penalty-point threshold for a request for restriction of bidding eligibility would be adjusted from 'more than 5 points' to '4 points or more.' Under the current Guidelines, even an enterpriser that repeatedly took part in cartels and had penalty surcharges imposed twice (2.5 points × 2 = 5.0 points) would have cumulative penalty points of 5 and would not be subject to a request for restriction of bidding eligibility. Under the amended Guidelines as proposed, however, even an enterpriser that has received only two corrective orders (2.0 points × 2 = 4.0 points) would have cumulative penalty points of 4 and would be subject to a restriction request. As a result, the pool of covered enterprisers would effectively expand, so that an enterpriser that has received a corrective order or a heavier measure for a cartel and, within 10 years, again receives a corrective order or a heavier measure for a cartel becomes subject to a request for restriction of bidding participation.

※ Where different types of corrective measures are imposed simultaneously in a single case, only the points for the highest-level measure are counted.

3. Relevant Statutes, Effective Date and Transitional Measures

The statutory basis for the system of requests for restriction of bidding eligibility, and the effective date and transitional measures under the proposed amendment of the Guidelines, are as follows.

However, in order to ensure predictability for enterprisers in light of the amendment of the Guidelines, the proposed amendment provides a transitional measure under which the former provisions apply until December 31, 2031 to requests for restriction of bidding eligibility against enterprisers that have penalty points imposed for cartels before the amended Guidelines take effect. In addition, while the sunset date of the current Guidelines was due to expire on June 30, 2027, the proposed amendment repeals the current Guidelines and establishes new Guidelines, extending the sunset date to December 31, 2029. The existing provisions setting out the types, content and examination standards for bid rigging are maintained as they are under this amendment.

4. Self-Check Checklist for Companies Participating in Public Tenders

We have summarized the matters that compliance and legal officers of companies regularly participating in public procurement tenders should check in light of this amendment.

5. Cheongchul Law Firm's Advisory and Litigation Services on Bid Rigging and Restriction of Bidding Eligibility

Cheongchul Law Firm is composed of attorneys specializing in fair trade and public procurement who have a wide range of advisory, investigation, deliberation and litigation experience representing both companies and the KFTC across the statutes under the KFTC's jurisdiction and public procurement legislation, including the Monopoly Regulation and Fair Trade Act (공정거래법), the State Contracts Act (국가계약법) and the Local Contracts Act (지방계약법). In connection with this amendment of the Guidelines, we help companies manage their risk through the following services.

● Responding to KFTC cartel investigations and deliberations, and developing defense strategies on the level of disposition (penalty points)

● Responding to requests for restriction and dispositions restricting bidding eligibility, and representation in applications for stay of execution

● Representation in litigation seeking revocation of dispositions restricting bidding eligibility

● Developing cartel compliance manuals and training executives and employees for companies participating in public procurement tenders

This proposed amendment of the Guidelines shows a policy direction of effectively restricting participation in the public procurement market by enterprisers that repeatedly take part in cartels, and since there is still time before the scheduled effective date (January 1, 2027), it is important to start reviewing your company's history of cartel sanctions and preparing a response strategy now. Corporate officers who need assistance with reviewing past cartel history, responding to pending KFTC investigations and deliberations, or responding to requests for restriction and dispositions restricting bidding eligibility are welcome to contact Cheongchul Law Firm.