Following Reports of Bid-Rigging in Large-Scale Renovation Works by the Fair Trade Commission, NewSatsu Promotes a Highly Transparent Competitive Environment

Today, multiple media outlets reported that the Fair Trade Commission intends to recognize violations of the Antimonopoly Act (unreasonable restraint of trade) and issue cease and desist orders concerning bid-rigging by construction companies and design consulting firms in large-scale renovation works for condominiums in the Kanto region.

Large-scale condominium renovation works are significant projects for management associations, involving tens of millions to hundreds of millions of yen.

However, the specialized nature of the work makes it difficult for management associations alone to select construction companies or determine the reasonableness of estimated costs.

These reports have once again highlighted the importance of ensuring transparency and fostering a fair competitive environment in large-scale condominium renovation works.

NewSatsu, an bidding platform for large-scale condominium renovation works operated by MRC Inc., aims to create an environment where management associations can confidently compare and select construction companies.

Key Initiatives by NewSatsu:

1. Mechanism to Make it Difficult for Participating Companies to Identify Competitors

In principle, bidding participants cannot know who else is participating in the same project.

This helps create an environment where inappropriate competitive practices, such as prior price adjustments or agreements on intended bidders, are less likely to occur.

2. Ensuring Confidentiality of Bidding Prices

During the bidding period, each company's estimated price cannot be viewed by other companies.

This promotes fair price formation while maintaining a competitive environment.

Furthermore, comparing the estimates from multiple companies makes it easier to identify inappropriate pricing or variations in unit prices.

3. Enabling Comparison of Construction Records and Proposals

Clients can compare and evaluate construction companies based on their past construction records, proposal documents, and other materials submitted.

This allows for comprehensive decision-making that considers not only price but also past performance, proposals, and responsiveness, supporting management associations in selecting contractors with confidence.

4. Creating Fair Competitive Opportunities for Multiple Companies

We provide an environment where multiple construction companies can participate in each project, independent of traditional business relationships or referral networks.

This allows clients to choose from a wider range of options, and contractors can participate in projects under fair conditions.

5. Available for Management Associations That Have Already Obtained Estimates

NewSatsu can be used not only by management associations planning future large-scale renovation works but also by those who have already obtained estimates.

By utilizing it as a second opinion to verify the appropriateness of current estimates and proposals, we support more informed decision-making.

6. Operational Structure Not Aimed at Awarding Contracts to Specific Companies

NewSatsu does not charge management associations any usage fees.

The service is funded by system usage fees (2.5% of the contract price) paid by construction companies that win contracts through NewSatsu. These fees are applied under the same conditions for all participating businesses, eliminating the need for bid-rigging.

Additionally, we provide support as a second opinion from experts, including confirmation of the scope of work, review of estimates, and assistance in selecting construction companies.

Our track record shows that approximately 90% of projects utilizing NewSatsu have achieved significant reductions in construction costs.

Towards an Environment Where Management Associations Can Confidently Select Contractors

As condominiums age, the importance of large-scale renovation works continues to grow.

Therefore, an environment is needed where management associations can make informed decisions by comparing multiple companies based on sufficient information.

MRC Inc. is committed to promoting a highly transparent bidding environment through NewSatsu, supporting the appropriate decision-making of management associations, and contributing to the sound development of the condominium large-scale renovation industry.

Triggered by the recent reports, we believe the importance of creating mechanisms that allow management associations to compare and select contractors in a more transparent environment will further increase. MRC Inc. will continue to work closely with management associations to provide a fair and transparent bidding environment.

[Contact Information for this Matter] MRC Inc. General Affairs Department Address: Kanda-Iwamotocho 4-5, Chiyoda-ku, Tokyo TEL: 03-6384-0024 / FAX: 03-6384-0064 MAIL: [email protected] Operating Company: MRC Inc. Company HP: http://mrc-archi.com/

Service Name: NewSatsu

Service HP: https://bestreform.jp/

Business Description: Operation of a bidding platform for construction and renovation work