Systemic Corruption in Public Procurement (Two Cases from the Czech Republic)

This study deals with the systemic corruption in public procurement. Systemic corruption is of institutional nature and represents corruptive behavior of a group. It involves the entire public procurement process, which is being rigged, and it is not the result of individual misconduct. The outcome of public procurement is usually agreed on beforehand and before the public procurement is publicly advertised. In this research study the authors present two cases of systemic corruption which took place in the local and the state administrations in the Czech Republic. The qualitative analysis sheds light on actors of systemic corruption and their ties. A qualitative descriptive model has been proposed to show official phases of public procurement - T-1 (pre-bidding), T-2 (bidding), T-3 (post-bidding). Moreover, two additional phases have been identified as: T-0 in which the corrupt actors enter the process (before the advertisement of the public tender) and the T-4 phase during which the corrupting parties work out their mutual obligations among each other which were stipulated in the collusive agreements made in the T-0 phase.