Two UK construction firms have admitted to forming an illegal cartel, according to the Competition & Markets Authority (CMA).
The CMA has provisionally found that three drainage product manufacturers broke competition law by co-ordinating prices for customers and sharing the market.
Two of them – Derbyshire-based Stanton Bonna Concrete and Somerset-based CPM group – have confessed to breaking competition law by taking part in a cartel that started in 2006 and continued for almost seven years.
A third company, FP McCann, headquartered in Northern Ireland, is also under investigation but has not made any admissions. At this stage, no assumption can be made that it has broken the law.
In a statement of objections issued by the CMA, it was said that the authority has provisionally found that the companies held regular secret meetings with the aim of fixing or co-ordinating prices and sharing out the market for certain pre-cast concrete drainage products in Great Britain. This was done in order to increase prices and reduce competition.
The drainage products are used in large infrastructure projects across the region, including water management, roads and railways. Typical customers were said to include engineering and construction companies, utilities providers, and local and national government.
The CMA said that throughout the period of the alleged cartel activity, the companies were leading players, accounting for over half of the market. From 2010 onwards, they were said to have held more than 90% of this market.
Michael Grenfell, executive director of enforcement at the CMA, said, “The CMA does not tolerate such practices and will use our enforcement tools to crack down on those it believes are taking part in illegal cartels.”
As part of a settlement process, Stanton Bonna and CPM have agreed to pay fines, which will be determined at the end of the CMA’s overall investigation. FPM is not part of this settlement.