Fine imposed by German regulatory body in antitrust dispute
Title: Seven German Road Repair Companies Hornswoggled for €10.5M Over Illicit Collusion
What in the blazes is going on, you ask? Well, buckle up, buttercup, 'cause things are about to get juicy in the German road repair sector. The Bundeskartellamt, the nation's competition regulator, dished out a hefty €10.5 million fine to a gang of road repair mates for their underhanded, anti-competitive dealings – a.k.a. bid rigging and customer allocation.
Here's the lowdown on the culprits:
- AS Asphaltstraßensanierung
- Bausion Strassenbau-Produkte
- Bitunova
- Gerhard Herbers
- Liesen alles für den Bau
- Mainka Straßenunterhaltung
- MOT Müritzer Oberflächentechnik
Digging Deeper
The Bundeskartellamt dug up some dirt during an investigation that unmasked these companies' competition law violations and German Criminal Code breaches. The snooping even led to a coordinated dawn raid in September 2019, carried out alongside the Düsseldorf Public Prosecution Office and North Rhine-Westphalia’s Criminal Police Office.
The scoundrels' deeds centered on the allocation of public contracts for multiple states and tenders related to simple road repairs, along with the supply of bitumen emulsion and grit. These contracts included mending cracks, surface patching, and dressing, totaling values between €40,000 and €200,000.
The investigation revealed that the companies agreed to allocate these contracts among themselves and collude on protective bids at minimum prices. Speaking on the matter, the Bundeskartellamt's president, Andreas Mundt, commented: "Effective competition in the public sector is crucial for efficient procurement of goods and services. Collusion like this can cause significant damage to public contracting authorities, eventually burdening all citizens."
The Nitty-Gritty
Investigators found that, between 2018 and 2019, AS Asphaltstraßensanierung, Bausion Strassenbau-Produkte, Gerhard Herbers, and Bitunova were in cahoots, allocating contracts for the federal states of Saxony, Thuringia, and Saxony-Anhalt. The companies divided the states into specific districts, with each company responsible for any regional tenders as they popped up. Through this scheme, the companies would confirm who would take the tender and collude on the minimum price of protective bids.
To make confusion their trusted confidant, these companies employed code language to mask their anti-competitive actions, and other communications were disguised as subcontract requests or bidding consortium proposals. Bausion Strassenbau-Produkte, Liesen alles für den Bau, Mainka Straßenunterhaltung, and MOT Müritzer Oberflächentechnik were also caught colluding on Brandenburg public tenders between 2016 and 2019, as well as Saxony-Anhalt tenders between 2016 and 2017. These trespassers even conversed via phone calls and hotel meals to decide on tender allocation and minimum prices for protective bids.
Liesen alles für den Bau and MOT Müritzer Oberflächentechnik were also found to have conspired for Western Pomeranian tenders.
The Bundeskartellamt asserts that public prosecution offices will be responsible for prosecuting the individuals involved in this cartel conduct. Bitunova was rewarded for its cooperation in the proceedings under the leniency program, which affected the size of the fine imposed.
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These companies' shady dealings not only jeopardized their business, but they put the public's trust – and wallet – in jeopardy. So, here's hoping these highway hijinx won't repeat themselves anytime soon!
- In the investigation, it was discovered that AS Asphaltstraßensanierung, Bausion Strassenbau-Produkte, and others manipulated the finance of public road repair contracts in several German states.
- The collusion on public tenders by these German road repair companies (AS Asphaltstraßensanierung, Bausion Strassenbau-Produkte, and others) not only threatened their business credibility but also posed a risk to the financial interests of the public contracting authorities and citizens alike.
