Road Repair Sector's Million-Euro Fines for Underhanded Deals
Road construction companies slapped with hefty fines by the Federal Cartel Office.
Get the lowdown on the hefty fines slapped on road repair companies for their sneaky cartel agreements, as the Federal Cartel Office steps in and dishes out a cool 10.5 million euros in penalties!
In a no-nonsense move, the Federal Cartel Office in Bonn has hit several road repair companies with a seven-figure fine, totaling 10.5 million euros. Seven companies across various regions have been implicated in years of dishonest practices over tender contracts.
According to the Federal Cartel Office, these companies were secretly coordinating their moves, setting price-fixing agreements from 2016 to 2019. It was a classic game of musical tenders, where companies allegedly agreed on who would grab the winning bid beforehand. Cover bids, complete with prearranged minimum prices, were often placed by unlucky contenders.
"Ensuring the public sector gets quality goods and services cheaply relies heavily on effective competition," explains Andreas Mundt, president of the Federal Cartel Office. He adds that illegal cartels can bring considerable harm, ultimately affecting citizens as a whole.
Four companies from Saxony, Thuringia, and Saxony-Anhalt conspired together in 2018 and 2019, using a mysterious "code language" to sort out which company would participate in which tender and submit which cover bid.
The illicit practices didn't stop there; four companies are alleged to have colluded in tenders in Brandenburg and Saxony-Anhalt, sometimes extending their toll-taking operations to Mecklenburg-Vorpommern. One of these companies played a dubious double role, having been involved in both scandals. The tenders in question revolved around simpler road repairs, bitumen emulsion supply, or the provision of gravel.
Contract sizes usually ranged between 40,000 euros and 200,000 euros. In 2019, the Federal Cartel Office, along with the Public Prosecutor's Office in Düsseldorf, conducted several raids. One company took advantage of the leniency program to cooperate investigators and lessen their penalty.
While specific cases and fines related to road construction cartels from 2016 to 2019 may not be readily available, the Federal Cartel Office's history shows an active and diligent enforcement of antitrust laws across various sectors, including construction. For more detailed information on cases or fines from this period, check the Federal Cartel Office's official publications or press releases.
Source: ntv.de, AFP
(Enrichment Data: The Federal Cartel Office is a German authority responsible for enforcing antitrust laws. Cartel agreements, such as those alleged in this case, can involve companies colluding to fix prices, limit production, or divide markets.)
- The Federal Cartel Office has stated that these illegal cartels in the road repair industry can cause significant harm, potentially requiring the intervention of vocational training programs to provide skilled workers in the business sector and ensure fair competition in the future, as a part of the community policy.
- In addition to the hefty fines imposed on these road repair companies for their cartel agreements, there have been related news reports across various regions about instances of crime and justice involving similar illegal activities in other sectors, such as finance or general-news, requiring increased vigilance and adherence to fair business practices by all entities.
