Public Procurement Service to impose bid bonds on companies suspected of being paper companies starting November 16; Single-vendor registration allowed for Commercial Software MAS

From October 21 to 23, the Public Procurement Service released three announcements regarding public procurement. These include strengthening the criteria for participating in goods purchase bidding, the recovery of unjust enrichment from companies engaged in unfair procurement practices, and the amendment of regulations for Multiple Award Schedule (MAS) for commercial software. If you are a business operator registered on Nara Market and participating in bids, you must check the details regarding the implementation on November 16.

1. Imposition of Bid Bonds on Companies Suspected of Being Paper Companies from November 16

On October 23, the Public Procurement Service announced that it will officially implement the “Measures to Eradicate Indiscriminate Bidding for Goods Procurement” starting from November 16. The Public Procurement Service explained that although they have implemented three sets of measures since 2021, such as transitioning to manufacturing-based bidding and establishing mandatory direct performance requirements, it has been difficult to prevent broker intervention by relying solely on sanctions after bidding.

Implementation Date: November 16, 2026
Target: Suspected paper companies filtered through company registration information, contract information, etc.
Core Change: Imposing bid bonds when the suspected company participates in bidding
Pilot Operation Results: As a result of imposing bid bonds on certain items since August, the average number of bidding companies per bid decreased by 83.9%, from 355 companies to 57 companies, and the average winning rank changed from 41st to 1.5th.

While media reports in July stated the implementation date for this stage as November 1, the implementation date in the Public Procurement Service’s press release on October 23 is November 16. The specific criteria for identifying suspected companies and the bond ratio are not included in the press release. ⚠️ It is necessary to check the original text of the relevant regulations revised by the Public Procurement Service.

2. Registration and Screening Criteria Changing from 2027

The same measures include contents scheduled for implementation in 2027.

Companies registered with more than 500 other supply items: Mandatory submission of Credit Rating Confirmation starting from 2027; the validity period of the confirmation is 1 year.
Habitual companies that abandon screening: Strengthening the bid bond imposition criteria from 5 instances of abandoning screening to 2 or more instances (planned for implementation in January 2027).
Failure to submit screening documents or abandonment of screening without justifiable reason: Pushing for restrictions on bidding qualifications within the year.

It is necessary to organize the registered items to the scope that companies can actually manufacture and supply, for those companies that have been registering a wide range of items and then abandoning the screening after winning a bid.

3. Decision to Recover 8.7 Billion Won from 34 Companies for Unfair Procurement Activities

The Public Procurement Service announced on October 22 that, following restrictions on bidding qualifications, it has decided to recover approximately 8.7 billion KRW in unjust enrichment from 34 companies caught for violations such as breaching direct production standards, violating contract specifications, and failing to maintain preferential prices. The targets included 22 items, such as permeable concrete and air circulators. In a bidding process for underwater survey services by the Korea Authority of Land & Infrastructure Safety, one company that pre-agreed on bid prices was referred to the Fair Trade Commission.

Companies supplying products subject to competition among small and medium-sized enterprises (SMEs) must meet the direct production confirmation standards throughout the entire contract period. If subcontracted production or the supply of finished products purchased from others is confirmed, restrictions on bidding qualifications and the recovery of funds may be processed together.

4. Revision of Commercial Software MAS Regulations, Effective October 20

The Public Procurement Service has completely revised the “Regulations on the Handling of Multiple Award Schedule (MAS) for Commercial Software and Special Conditions,” which has been in effect since October 20.

Permission for Single-Person Registration: For software related to national policies such as AI, single-person registration is possible within a small-scale range of up to 20 million KRW.
Social Solidarity Economy Organizations: Full exemption from the supply performance requirements (generally 2 or more cases) for social enterprises, village enterprises, and self-reliance enterprises; up to 7.5 points for supporting the underprivileged during the second-stage competition.
Timing of Training Completion: Before the eligibility evaluation → Before the contract conclusion.
Restriction Period for Adding Items: 90 days → 50 days; restrictions on major upgrades are abolished; minor upgrades can be processed through contract amendments if there is no price change.
Failure to Apply for Interim Inspection: A new procedure for a 1-month sales suspension has been established instead of immediate transaction suspension.
Prohibition of Unfair Practices by Demand Organizations: Mandatory compliance with corrective requests from the Public Procurement Service.

5. Points for Companies Participating in Procurement to Check

Check whether the registered information for bidding qualifications in Nara Market (factory, manpower, facilities) matches the actual current status.
Check if the number of registered “Other Supply Items” exceeds 500; if it does, schedule the issuance of the Credit Rating Certificate in advance.
Manage the validity period of direct production confirmation and the current production status together.

Hwang Yunsang administrative agent (administrative agent (administrative scrivener)) office provides document preparation/filing services for Public Procurement Service competitive bidding qualification registration, direct production confirmation applications, and Multiple Award Schedule (MAS) applications.

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This post is an administrative trend guide organized by the Hwang Yunsang administrative agent (administrative scrivener) office based on publicly available data. Whether these apply to individual cases requires verification with the competent authorities.