Construction firms fined £60m

by Andrew Curtin /  March 24, 2023

The firms were fined over unlawfully colluding on prices through cartel agreements when bidding for demolition and asbestos projects.

Some of the contracts included:

• Selfridges department store.
• Oxford University.
• Bow Street Magistrates’ Court.
• Old War Office, Whitehall.

These were both public and private sector contracts worth over £150million. The CMA said illegal activities took place between January 2013 and June 2018.

Cover Bidding

It is said that firms engaged in ‘cover bidding’ which is defined:

“Parties submit bids that are too high to be accepted, or with terms that are unacceptable to the party calling for bids, to protect an agreed upon low bidder. This can create the impression of a competitive bidding process, when in fact the bids that are submitted are the result of collusion” – Thomsan Reuters.

Companies fined:

• Keltbray: £16,000,000
• Erith: £17,568,800
• Scudder: £8,256,264
• JF Hunt: £5,600,000
• McGee: £3,766,278
• Brown and Mason: £2,400,000
• Squibb: £2,000,000
• Cantillon: £1,920,000
• DSM: £1,400,000
• Clifford Devlin: £423,615

Three directors in Cantillon and Erith have received disqualifications for between four-and-a-half years and seven-and-a-half years. The directors benefitted from reduced disqualification periods, due to voluntarily agreeing to the disqualification due to the undertakings of the CMA.

Michael Grenfell, the CMA’s executive director of enforcement, states: ‘The construction sector is key to our country’s prosperity, so we want to see a competitive marketplace delivering value, innovation, and quality.

‘Today’s significant fines show that the CMA continues to crack down on illegal cartel behaviour.

‘It should serve as a clear warning: the CMA will not tolerate unlawful conduct which weakens competition and keeps prices up at the expense of businesses and taxpayers.’