[Sejong = E-Daily Reporter Kang Shin-woo ] The Fair Trade Commission has launched a sweeping investigation into allegations of bid-rigging in public construction projects, starting with projects by the Korea Land and Housing Corporation (LH) that use the Comprehensive Evaluation and Bidding System (CEBS).

Six major construction companies, including Gyeryong Construction and Kumho Construction, have been identified as the initial targets of the investigation. The construction industry is on high alert as speculation mounts that the scope of the investigation could be expanded to cover all public construction projects for which the Public Procurement Service conducts bidding.

According to the construction industry on the 28th, the Fair Trade Commission’s Construction and Energy Cartel Investigation Division began on-site inspections that day targeting six construction companies: KR Industries, Jinheung Enterprise, Gyeryong Construction, Kumho Construction, Kolon Global, and Isu Construction. It has been confirmed that the Fair Trade Commission is looking into allegations of bid-rigging in public construction projects involving these companies.

This on-site investigation marks the first action taken by the Construction and Energy Cartel Investigation Division, which was launched earlier this month. After establishing a dedicated unit to specifically address collusion in the construction and energy sectors, the Fair Trade Commission has targeted allegations of bid-rigging in public construction projects by major construction firms as its first investigation.

The investigation centers on projects commissioned by the Korea Land and Housing Corporation (LH) that utilize the Comprehensive Evaluation System. This system selects the winning bidder through a comprehensive evaluation that considers not only bid prices but also construction capabilities and social responsibility. Since the “equilibrium price”—calculated based on the bid amounts submitted by participating companies—influences the evaluation, competition can be distorted if construction firms share or coordinate price information in advance.

Allegations of bid-rigging related to LH’s comprehensive evaluation system emerged last year. It is reported that the Fair Trade Commission investigated at the time whether construction companies participating in LH-commissioned projects had shared their bid prices in advance. Industry observers have speculated that bids totaling approximately 27 trillion won from public housing projects commissioned by LH since 2021 are under investigation.

It is reported that this investigation is also examining allegations of bid-rigging in the Southern Inland Railway construction project, which is currently underway. The Southern Inland Railway is a national project with a total budget of approximately 7 trillion won connecting Gimcheon in North Gyeongsang Province and Geoje in South Gyeongsang Province, with the Korea National Railway Corporation serving as the contracting authority. Construction began early this year, with main construction underway in some sections, and the project aims to open by the end of 2031.

Given that the Fair Trade Commission is examining the possibility of collusion across all construction projects commissioned and tendered by the Public Procurement Service, there is speculation that the scope of the investigation may be expanded further.

An industry official stated, “It is understood that a large-scale investigation will be conducted across all public construction projects commissioned by the Public Procurement Service,” adding, “Since the scope of the investigation could expand to include other construction companies and projects, there is a sense of tension throughout the industry—not only among small and medium-sized construction firms but also among large construction companies.”

Meanwhile, an official from the Fair Trade Commission stated regarding this investigation, “We cannot confirm whether individual cases are under investigation or disclose specific details.”