188体育

In 2019, 3 concrete companies were found to have entered into illegal arrangements under which they fixed or coordinated their prices, shared out the market by allocating customers, and exchanged competitively sensitive information.

The businesses manufactured pre-cast concrete drainage products which are essential for roads and railways and used in large infrastructure projects. The customers who typically need to buy these types of products include local and national government bodies, as well as utilities, engineering and construction firms.

The companies were fined 拢36 million and 2 directors have been disqualified for 6.5 and 7.5 years with additional disqualification cases pending in court.

What happened

The cartel arrangement began in 2006 after a period of fierce competition and low prices in response to tough market conditions. The rivals met to end this situation and create what one of them described as a 鈥榥ew era of trust鈥�.

Secret meetings

Regular, secret cartel meetings took place (4 of which were secretly recorded by the CMA), held away from business premises, in hotel meeting rooms. One member of the cartel kept track of the discussions in a 鈥楤oys Spoils鈥� file; others referred to the arrangement as the 鈥楶igeon Club鈥� 鈥� clearly recognising that that this was not ordinary business practice.

One of the individuals at a cartel meeting said:

But guys, look at our, look at all our financial numbers, we鈥檝e all had a good year. Everybody has had a good year financially and profit-wise. And that鈥檚 come about by all sitting here and [being] patient.

(Secretly recorded evidence from cartel meeting, case decision paragraph 4.55)

Agreeing price lists

The businesses discussed and agreed their spot market price lists, where prices are agreed on a deal by deal basis. These were then used by sales teams as a basis for negotiating with customers - in effect, the agreed list prices acted as 鈥榯argets.鈥�

Market sharing

The businesses also agreed that they would not compete for each other鈥檚 customers on certain fixed price contracts (鈥榯erm deals鈥�) 鈥� a so-called 鈥榥o poaching鈥� arrangement.

For example, one sales person said he was told:

something to the effect of 鈥渨e don鈥檛 touch each other鈥檚 term deals鈥�. I took this to mean that [company X] didn鈥檛 target the term deals of other manufacturers and vice versa. There was an unwritten rule.

Illegal information exchange

The rivals also regularly shared competitively sensitive information so they could monitor each other鈥檚 actions: this meant that they all knew where they stood with one another (including in terms of market share) and could plan their approach accordingly.

Falsely claiming compliance

In this case, individuals within the businesses had signed compliance documents and/or declarations saying that they would not break competition law. But, by itself, the signing of such documents does not provide a safeguard. Such documents must be understood and followed.

How this broke the law

Discussing and agreeing price lists with competitors, market sharing and the sharing of competitively sensitive information are all illegal anti-competitive practices.

The businesses did not operate independently of each other. Through regular contact, they cooperated in relation to price and the allocation of customers. Their aim was to increase prices, and maintain their market position without having to compete fairly.

Lessons from this case

• the construction sector remains in the CMA鈥檚 sights

• tough market conditions are no excuse for breaking the law

• never exchange competitively sensitive information

• never agree with rivals not to compete for customers or business

• the CMA has sophisticated means of capturing evidence and despite the businesses meeting in various different locations, we were watching

• it is not enough to claim you are complying with the law 鈥� you need to actively comply

Benefits of co-operating with an investigation

If a company is the first to report being part of a cartel and fully co-operates with an investigation, it can benefit from immunity from fines and its co-operating directors can avoid director disqualification.

Even after an investigation has started, it can still benefit from reduced fines through our leniency programme. In this case, one of the businesses did this and it benefited from a reduction in its fine.

Individuals may also be eligible for immunity from prosecution and director disqualification if they come forward independently and cooperate with the investigation.

If you think you may have broken the law, we always recommend that you seek independent legal advice.

If you have information on other companies in your industry that may have been involved in an anti-competitive arrangement, report it to us; you may qualify for a reward.

For more information, including how best to report, visit our