Drainage pipes were one of the concrete products that were being price fixed by the cartel. © Getty Images/iStockphoto
Drainage pipes were one of the concrete products that were being price fixed by the cartel. © Getty Images/iStockphoto

'Illegal cartel' of construction firms fined £36m

23 October 2019

Three UK construction firms have been issued with fines by the competition watchdog for price fixing of concrete drainage pipes.

An investigation by the Competition and Markets Authority (CMA) found that construction firms Stanton Bonna Concrete, CPM Group and FP McCann had been “sharing the market by allocating customers and regularly exchanging competitively sensitive information”.

The firms sold pre-cast concrete products such as drainage pipes often used in roads, railways or water management projects. Customers included engineering and construction companies, utilities providers, and local and national governments across the UK.

The CMA said that between July 2006 and March 2013 the companies held meetings involving senior executives to set up and operate an illegal cartel, aiming to fix or coordinate prices and share out the market for concrete drainage products, with the intention of increasing prices and reducing competition.

All three companies were leading players in the industry at the time of the infringement, holding over 90% of the market from 2010 onwards, it added.

The CMA handed Stanton Bonna Concrete and CPM Group reduced fines of approximately £7m and £4m respectively after both firms admitted to breaking competition laws by engaging in these arrangements. 

Meanwhile, FP McCann is facing a fine of up to £25m for its involvement in the scheme.

Andrea Coscelli, chief executive at the CMA, said: “These companies entered into illegal arrangements where they secretly shared out the market for important building products and agreed to keep prices artificially high. This is totally unacceptable as it cheats customers out of getting a good deal.

“The CMA will not hesitate to issue appropriately large fines in these cases and we will continue to crack down on cartels in the construction sector and in other industries. ”

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