/ Chile’s antitrust agency published its proposals for public procurement reform

27 August, 2020

The proposals are grouped in two major areas: those destined to optimize competition and efficiencies in government procurement y and those that are structural in nature.


The measures address eight aspects of the system referring to structure, data and transparency, planning and budget, operation of calls for tenders, framework agreements and direct dealing, in addition to selection and management of contracts.

As to institutional improvements, the Fiscalía Nacional Económica (Chile´s antitrust agency, FNE) proposes to grant regulatory powers to the government procurement agency (ChileCompra), strengthen the supervisory system, broaden the powers of the public procurement court (Tribunal de Contratación Pública) and modernize ChileCompra’s online bidding system so that the whole call process turns digital.

“This means that all the information in the public procurement system must be born and die digitally” explained the head of the FNE.

This aspect, according to the FNE, is crucial, given that it would “allow the FNE to monitor more efficiently any bid rigging conduct, detect more expeditiously corrupt practices and generally provide more accessible oversight by citizens in relation to government spending”.

In its research the FNE identified that there are few suppliers in calls for tenders (that explain 55% of purchases) and that there is reduced competition in the entry to and operation of framework agreements (25% of the total amount).

In relation to framework agreements, the FNE identified important savings that could be made, in the range of US$ 240 million to US$ 805 million a year, just if the mechanism to choose the supplier among those already in a framework agreement with the government is improved.

This is a conservative estimate, according to the FNE, given that the above amounts do not include savings that could be achieved by, inter alia, better planning, better definition of markets, greater standardization of the bidding processes, more competition in the first phase of framework agreements, and reduced use of direct dealing, in addition to the increased efficiency that would result from the enhanced accountability that a new information system would provide.

The FNE also concluded that it is necessary to strengthen the supervision of purchase processes given that the FNE found that nearly 60% of the direct dealings did not meet regulatory requirements and standards.

The following is the link to the FNE proposals

If you need more information, please do not hesitate to contact a member of our competition/antitrust team.