Guidance

Exclusion and debarment on competition grounds - what suppliers and contractors need to know

Published 26 February 2025

Applies to England, Northern Ireland and Wales

From 24 February 2025, the new Procurement Act 2023 strengthens rules to exclude suppliers from taking part in public procurement where they pose particular risks. Changes include a new mandatory exclusion ground for participants in cartel activity, a discretionary exclusion ground for potential competition infringements and the introduction of a central debarment register. 

The new exclusion and debarment regime has consequences for cartelists. Suppliers who break competition law risk mandatory exclusion from individual public procurements by a contracting authority. They are also at risk of being added to the new central debarment list, resulting in automatic exclusion from all public procurement contracts for up to 5 years.

There is now an increased incentive for suppliers involved in cartel activity to be the first to report the wrongdoing to the CMA: those first to report under the CMA’s leniency policy can avoid exclusion and debarment.

If you are a supplier that tenders for public sector contracts or a contracting authority that runs tender procedures, the new exclusions and debarment regime is relevant to you.

What do ‘exclusion’ and ‘debarment’ mean?

Exclusion:

Refers to a supplier not being permitted to participate in a tender, or to be awarded a public contract, following an assessment of exclusion grounds by a contracting authority.

Debarment:

A supplier may be placed on a central debarment list by a Minister of the Crown. This will prevent the supplier from participating in any covered procurements (for example, those over a designated threshold for the type of contract and not exempted) or being awarded public contracts for up to 5 years. The list will be managed by the Procurement Review Unit (PRU) and published on GOV.UK.

Debarment is linked to exclusions in that a supplier can only be considered for debarment following an assessment of exclusion grounds.

Mandatory and discretionary exclusion

There are 2 types of competition exclusions that can occur under the new Procurement Act: mandatory (Schedule 6 of the Act) and discretionary (Schedule 7 of the Act).

Mandatory exclusion applies when:

• a supplier has been found (by the CMA or another regulator) to have broken competition law by taking part in cartel activity (which includes colluding with competitors to rig bids, fix prices or share markets), or has been convicted of the criminal cartel offence under the Enterprise Act 2002

• the circumstances giving rise to the exclusion ground are continuing or likely to occur again

If a supplier falls within the mandatory exclusion ground or is on the debarment register for a mandatory exclusion ground, contracting authorities must exclude it from a procurement.

Discretionary exclusion applies when:

• the contracting authority or Minister considers that a supplier has engaged in cartel activity or in other non-cartel CA98 infringement decisions, including anti-competitive agreements, abuse of a dominant position (such as excessive or discriminatory pricing) or resale price maintenance

• the circumstances giving rise to the exclusion ground are continuing or likely to occur again

If a supplier falls within a discretionary exclusion or is on the debarment register for a discretionary exclusion ground, contracting authorities may exclude it from a procurement.

Suppliers should note that they may be excluded from public procurement contracts if an exclusion ground applies to a ‘connected’ or ‘associated’ person. This can include directors, parent or subsidiary companies, and key sub-contractors.

A supplier will not be excluded, either on a mandatory or discretionary basis, if it is an immunity recipient or an individual who is immune from prosecution for cartel conduct. This applies to all leniency recipients that benefit from a 100% reduction in a fine.

In addition, suppliers who have engaged in cartel activity, but do not benefit from immunity, may avoid exclusion or debarment on competition law grounds if they can demonstrate that they have ‘self-cleaned’.

Self-cleaning

Determining whether the mandatory or discretionary competition exclusions apply to a supplier requires an assessment of whether the circumstances giving rise to the exclusion ground are continuing or likely to occur again. This involves an assessment of whether the supplier has ‘self-cleaned’. The Procurement Act sets out a number of factors a contracting authority or Minister can take into account when assessing whether a supplier has self-cleaned (in Section 58) and include:

• evidence that the supplier, associated person or connected person has taken the circumstances seriously, for example by paying compensation

• steps that the supplier, associated person or connected person has taken to prevent the circumstances occurring again, for example by changing staff or management, or putting procedures and training in place

• commitments that such steps will be taken, or to provide information or access to allow verification or monitoring of such steps

• the time that has elapsed since the circumstances last occurred

• any other evidence, explanation or factor that the authority considers appropriate

Applying for and being granted leniency and/or entering into a settlement agreement with the CMA under the Competition Act 1998 may be relevant evidence that a supplier can introduce to demonstrate that it has taken the circumstances giving rise to the application of an exclusion ground seriously for the purposes of the self-cleaning assessment.

Steps suppliers may take to avoid exclusion or debarment

For suppliers, the best way to avoid exclusion or debarment on competition grounds is to understand and remain compliant with competition law. Read our compliance advice on our Cheating or Competing campaign page and share compliance materials with all staff.

However, if you realise you have been involved in cartel activity which breaks competition law, there are steps you can take:

Admit wrongdoing and be the first to apply for leniency:

If a supplier is the first to report cartel activity to the CMA and is granted a 100% discount on any financial penalty under the CMA’s leniency policy, it will not be excluded from public procurement or appear on the central debarment list

‘Self-cleaning’:

Before deciding whether a supplier should be excluded, the contracting authority must give the supplier a reasonable opportunity to provide evidence to demonstrate that it has ‘self-cleaned’ - as noted above, if applicable, a supplier may want to provide evidence of being granted leniency and/or entering into a settlement agreement with the CMA as these may be relevant evidence for the purposes of the self-cleaning assessment

Steps for contracting authorities 

The new regime applies to all contracting authorities in England, Wales, and Northern Ireland, but not in Scotland. It is however applicable to suppliers which operate and/or are incorporated in Scotland. From 24 February 2025, prior to awarding public contracts, contracting authorities must determine whether exclusions apply to potential suppliers including assessing if a supplier has ‘self-cleaned’. To help them with that assessment, contracting authorities can:

• check the central debarment list on GOV.UK before procurement exercises

• check the CMA decisions register for infringement decisions

• check for ongoing investigations in the CMA case list

How the CMA can help contracting authorities

It is for a contracting authority to determine whether an exclusion applies to a particular supplier. However, the CMA can help in a number of ways. Contracting authorities can contact the CMA by emailing cma_procurementsupport@cma.gov.uk to:

• confirm whether a supplier is an immunity recipient. Guidance on leniency can also be found in the CMA leniency guidance

• check whether an infringement was through participation in a cartel (including practices such as fixing or co-ordinating purchase or selling prices or other trading conditions, sharing markets and customers, bid-rigging or output restrictions) if it is not clear from the published decision

• ask for more information to assist them in determining whether the discretionary exclusion grounds apply where a supplier is or may be under investigation

• confirm whether a particular supplier has been granted leniency and/or entered into a settlement agreement for the purpose of self-cleaning assessments. This information will also normally be set out in published CMA decisions and may be relevant evidence to demonstrate that a supplier has taken the circumstances giving rise to the application of an exclusion ground seriously - which is a relevant factor in the self-cleaning assessment

Contracting authorities can also reduce bid-rigging risk by following the CMA’s bid-rigging advice for public sector procurers. If you suspect bid-rigging or would like a free CMA teach-in on bid-rigging red flags, please contact us by emailing cma_procurementsupport@cma.gov.uk.

Anti-competitive behaviour – consequences and detection

Anti-competitive behaviour can take many forms, such as abusing a dominant market position, colluding with other businesses to fix prices or rig bids or restricting how much other businesses can sell your product for.

Public sector procurement is particularly vulnerable to bid-rigging which can, on average, increase costs by 20% or more and prevent honest businesses from competing on a level playing field.

Bid rigging: cheating or competing? UK’s Competition and Markets Authority

The CMA has advanced data science capabilities to help spot suspicious bidding patterns in public sector procurement, as well as robust investigative powers at our disposal.

The risk of getting caught breaking competition law is, therefore, high, and the consequences are serious including big fines for companies and for individuals, director disqualification (up to 15 years) and in most serious criminal cases – prison (up to 5 years). Now, under the new regime, there is also the additional risk of exclusion and debarment from public sector frameworks.

How to report concerns to the CMA

If you witness or suspect another business breaking the law:

• never confront a supplier yourself

• call us on 020 3738 6888

• email us at cartelshotline@cma.gov.uk

If you’ve been involved:

• come forward and you may get leniency

• call us on 020 3738 6833 and we can provide confidential guidance.

• always seek independent legal advice

Resources

If you want to know more:

• Further information on the exclusion and debarment regime is set out in Cabinet Office Guidance: Exclusions and Cabinet Office Guidance: Debarment.

• the CMA will provide additional guidance on the interplay between the new procurement regime and the CMA’s leniency regime in the CMA’s consultation document and draft leniency guidance to be published for consultation shortly.

• further information on how the new Procurement Act applies to devolved contracting authorities is set out in Cabinet Office Guidance: Devolved Contracting Authorities.

• further examples of anti-competitive behaviour can be found in Avoid and report anti-competitive activity: Types of anti-competitive activity.

• Procurement Review Unit: Before using the Procurement Review Unit service