AMCU Bid-Rigging Investigations: Fines, Challenges and Case Law

What the same IP address actually proves, and why for a procurement participant debarment often costs more than the fine

Why this is not a tax matter

The same IP address is not, in itself, an infringement. The tax authority sees it in the Electronic Cabinet logs (see our analysis of the shared IP address risk for sole proprietors) and may count it towards a risk criterion: for legal entities, this is a shared address or e-mail used by more than seven taxpayers, each with a sales volume exceeding UAH 4 million. A bank sees it in internet banking logins and may suspend a payment as an indicator of a suspicious transaction. However, the State Tax Service cannot assess additional tax on the basis of the address alone. The courts, including the Supreme Court, require primary documents, calculations and reconciliations.

A shared IP address carries the greatest weight in investigations by the Antimonopoly Committee of Ukraine (AMCU). In bid-rigging cases it is no longer a reason to investigate but part of the evidence. The AMCU need not prove a written agreement or loss. It is sufficient to establish concerted conduct capable of distorting the outcome of a tender, and such conduct may be assembled from indirect traces: one address, shared personnel, identical files, identical printing defects.

What the AMCU collects and how it appears in the case

Proceedings for infringement of economic competition law begin not with an audit in the tax sense but with a request for information. The territorial office asks who prepared and signed the bids, from which address the platform and the bank were accessed, who is the authorised person for the bank accounts, and which contracts link the respondents. Prozorro and platform logs are not publicly available: they are provided on request.

The typical set of evidence that subsequently forms the statement of preliminary findings is as follows: the same IP address for both participants; a shared bank contact person or a shared telephone number; identical PDF file properties, including the scanner record and an identical creation time; identical printing and scanning defects; similar wording in the certificates required by the tender documentation; prices where the second participant bids a few thousand hryvnias above the first participant's initial price and does not enter the auction.

None of these traces proves collusion on its own. The Supreme Court has repeatedly held that a decision of an AMCU body cannot be based on conclusions of a predominantly probabilistic nature, and that courts must assess a shared address together with other circumstances, not in isolation. However, the courts consistently accept the combination of those same traces across all tenders. Cases such as No. 910/20567/20, No. 910/102/25 and No. 910/7614/25 show that a single address, file metadata and a shared contact person are often sufficient for the decision to be upheld.

What the address does not show

An IP address belongs not to a computer or a person but to a network exit point: an office router or the provider's equipment. Dozens of subscribers may operate behind a single address simultaneously if the provider uses NAT. The address may be dynamic. Websites such as 2ip show only which provider the block belongs to, not who used it at a particular minute. Only the provider knows this, and only for as long as it retains its logs.

Accordingly, the explanation "this is our provider's address, used by many subscribers" works only when it is supported by a document. What is required is a subscriber agreement concluded before the tender and a certificate from the operator stating that the address is dynamic, NAT is applied, and a large number of subscribers used the address during the tender period. A whois printout is useful only if it confirms what you state. If the register lists as the block holder not your company but a co-owner as an individual, such a printout is better left out, as it creates a new discrepancy.

A qualified electronic signature (QES) key, a shared bank login and identical files carry more weight than the address. If reports or bids are signed with the same QES, this is no longer a coincidence of addresses. If the accountant of one participant prepares the payment documents of the other, this directly supports the argument of a single economic interest. If the files were scanned on the same device, the NAT explanation no longer helps.

The fine: how it is calculated

The maximum fine for anticompetitive concerted practices is 10 per cent of income (revenue) from sales for the last reporting year preceding the year in which the fine is imposed. This is provided by Article 52(2) of the Law "On Protection of Economic Competition". For a sole proprietor with income of UAH 5.5 million, the ceiling is approximately UAH 552 thousand. For an LLC with income of UAH 78 million, it is approximately UAH 7.8 million.

The calculation procedure was approved by AMCU Order No. 22-rp of 14 December 2023 (the "Procedure"). It proceeds in three stages: the basic amount, adjustment for aggravating and mitigating circumstances, and verification against the maximum amount.

The basic amount for concerted practices in tenders is set at up to 30 per cent of the income related to the infringement, taking into account the degree of negative impact. In practice, the territorial office often takes the contract concluded following the tender or, where the tender has been declared failed, the expected value, and applies the maximum 30 per cent without assessing the circumstances of each tender. Paragraph 2 of Section IV of the Procedure adds an important limit: the basic amount must not exceed two thirds of the maximum, so as to leave room for aggravating circumstances. With a sole proprietor's ceiling of UAH 552,211.70, the basic amount cannot exceed UAH 368,141. If for a single tender the territorial office calculates 30 per cent of an expected value of UAH 2.4 million, that already amounts to UAH 720,060, which exceeds both the ceiling and the two-thirds limit.

The Procedure sets out four principal aggravating circumstances: the respondent was the initiator or coordinator; the infringement covered more than two regions; a repeated infringement of the same classification; and certain cases of benefit or unlawful profit exceeding the calculated fine. Neither admitting the infringement nor filing objections constitutes an aggravating circumstance. Mitigating circumstances are: termination of the conduct before the statement of preliminary findings, compensation for damage, competing with third parties contrary to the agreement, cooperation that helped establish the circumstances, and action to mitigate the consequences. Separately, the fine may be reduced on grounds of force majeure, in particular martial law, certified in the prescribed manner, and on evidence that a fine in the proposed amount would result in bankruptcy or cessation of business. A "first infringement" is not a mitigating circumstance.

One infringement or seven fines

The courts have upheld the practice of imposing separate fines for each tender. However, where the statement itself describes a single course of concerted conduct across several tenders on the basis of one set of circumstances, there are grounds to argue for a single infringement and a single 10 per cent cap. Otherwise the AMCU would have to prove each episode with separate evidence, and bank data and the contact person are often not linked to specific tenders. For an LLC with a large income this changes almost nothing, since the sum of the basic amounts is below the ceiling. For a sole proprietor, this is the principal argument.

The absence of a contract and income on the part of the respondent itself does not negate the infringement. For Article 6(2)(4), concerted conduct is sufficient. Paragraph 4 of Section IV of the Procedure links the basic amount to the contract concluded following the tender, with any party. Therefore "we did not win and received nothing" operates as an argument on the amount of the fine, not as grounds for closing the case. A distinction should also be drawn between cancellation of a tender under Article 32 of the current Law "On Public Procurement" (Article 35 in Law No. 4888-IX) and a tender being declared failed. The expected value applies as the basis only in the latter case. Where the tender was cancelled automatically and the bids of all participants were rejected, applying the expected value constitutes an expansive interpretation of a liability provision.

Debarment costs more than the fine

A decision finding an infringement under Article 6(2)(4) and Article 50(1) is grounds for rejecting a participant in public procurement for three years. Currently this is Article 17(1)(4) of Law No. 922-VIII "On Public Procurement" and the corresponding paragraph of the Specifics of public procurement approved by Cabinet of Ministers Resolution No. 1178. Once Law No. 4888-IX takes effect, the ground will move to Article 21, but the substance will remain: three years and an entry in the State Register. Until the new law enters into force, the current numbering applies, and procurement procedures already commenced are completed under the previous procedure. A single episode is sufficient for debarment. If even one tender remains in the decision, the participant receives the same exclusion as for several episodes.

Accordingly, for a company that depends on public contracts, a strategy of disputing only the amount means accepting debarment. Objecting on the merits does not in itself increase the fine. The Procedure offers no reduction for admission. Settlement with a 15 per cent reduction under Article 46-1 does not extend to bid-rigging cases. There is no reward for admission, and an admission all but forecloses a challenge on the merits in court.

How to object

Objections are filed within the time limit stated in the letter enclosing the statement of preliminary findings, to the postal and e-mail address given in that letter. There is no prescribed form. Each respondent signs with its own QES and sends from its own mailbox. A joint text with two signatures and identical cover letters contradict the argument that the participants are separate entities.

The structure that preserves both the court route and the argument on amount is as follows. First, objections on the merits for all episodes: the standard of proof, explanation of the address by reference to the subscriber agreement and NAT, different signatories, different file dates, words run together in one certificate and their absence in the other. Then a fallback position on the fine, with an express statement that it does not constitute an admission. It sets out the arithmetic, the two-thirds limit, a single infringement and a single ceiling, the absence of income on the part of the respondent itself, competition with third parties where it occurred, cooperation by responding to the request for information, martial law as certified by a letter from the Chamber of Commerce and Industry, and the absence of aggravating circumstances.

Only explanations supported by documents should be submitted. Some documents are better withheld, even if they relate to the independence of the tender participants. A sole proprietor's tax return showing restaurant activity codes, zero employees and single tax Group 2 indicates that the participant was physically incapable of renovating schools. Company records with Order No. 1 dated two months before the tender reveal a newly established participant. Refusal letters in the sequence "first the LLC, then the sole proprietor, the contract going to a third party at a higher price" may draw attention to an exit scheme. A lease between the sole proprietor and the director of the LLC links them rather than separating them. Certificates of completed services for tenders won by the respondent itself confirm income subject to disgorgement. Financial statements showing a profit contradict the argument of financial hardship.

Court proceedings: realistic expectations

The prospects of having the decision set aside on the merits on this body of evidence are realistically low. The Supreme Court accepts the combination of a single address, metadata and a shared contact person. However, without objections filed with the AMCU, the court may decline to accept new explanations. They must therefore be filed now, even if the administrative board does not take them into account.

As a rule, the court does not recalculate the fine in place of the AMCU. If the decision is upheld on the merits, reducing the amount in court is considerably more difficult than before the administrative board. The practical conclusion follows: arguments on the ceiling, the two-thirds limit, the absence of income and the degree of impact must be exhausted in the objections rather than held back "for court".

Before filing a claim, it is advisable to inspect the case file under Article 40 of the Law. Respondents are often sent an extract rather than the full statement. Applications are filed by each respondent separately: an entry in the log confirms inspection only by the person who applied. The sole proprietor separately needs a non-anonymised calculation of her own fine. On site, give no explanations and sign nothing other than the log. New arguments raised after the decision go into the claim.

The limitation period rarely helps (see our separate analysis of tax limitation periods). Under Article 42(2), the limitation period is suspended from the date on which consideration of the case begins, and at that date the five years have often not yet expired.

For a business that depends on public contracts, an AMCU decision on bid rigging means, above all, three years outside Prozorro. The fine can be reduced before the administrative board if both the substance and the calculation are challenged in good time and with documentary support. Debarment is removed only by setting the decision aside. Remaining silent therefore costs more than objecting.

Frequently asked questions

Is a shared IP address proof of bid rigging?

Not on its own. The Supreme Court requires the address to be assessed together with other circumstances. However, courts consistently accept the combination of one address, file metadata and a shared contact person as evidence of concerted conduct.

What is the maximum AMCU fine for bid rigging?

Up to 10 per cent of income (revenue) for the last reporting year preceding the year the fine is imposed, under Article 52(2) of the Law "On Protection of Economic Competition". Under Procedure No. 22-rp, the basic amount is up to 30 per cent of the income related to the infringement and may not exceed two thirds of the maximum.

Can we avoid the fine if we did not win the tender?

No. Article 6(2)(4) requires only concerted conduct. The absence of a contract and income is an argument on the amount of the fine, not grounds for closing the case.

What matters more to challenge — the fine or the Prozorro debarment?

The debarment. An infringement decision means three years of exclusion from public procurement, and a single episode is enough. The fine can be reduced before the AMCU board, but debarment is removed only by setting the decision aside — so challenge both the merits and the calculation.