Four fined in Hungarian rail cartel

Gazdasági Versenyhivatal (GVH), the Hungarian competition authority has imposed fines totalling HUF 7,18 billion (€ 25,6 million) against four construction companies accused of "hardcore cartel activity". The companies, plus a fifth that avoided a under leniency rules, are accused of bid rigging and setting up market sharing agreements in Hungary's railway maintenance sector in 2005 and 2005.

The companies being fined are Colas Zrt - HUF 1,5 billion (€ 5,3 billion), Mávépcell, part of the Swietelsky group - HUF 2,1 billion (€ 7,5 million), Máv MTM RT, a Hungarian company now in liquidation - HUF 178 million (€ 0,64 million) and Szentesi Vasútépitö, part of Strabag - HUF 3,4 billion (€ 12 million). The fifthe company alleged to be part of the cartel is Vasútépitök Kft, which has escaped a fine by informing GVH of the competition law infringements.

The fines follow raids carried out in November 2007 on a total of 17 construction companies, however GVH found no evidence against 12 of these. The authority says the contracts affected by the cartel had a total value of HUF 24 billion (€ 86 million), and covered five tenders issued by the Hungarian government in 2004 and 2005.

GVH says members of the cartel manipulated their bids so pre-agreed companies would win specific contracts. As part of the agreement, other companies in the group were allocated work as sub-contractors or allowed to win other contracts.

The companies named in the judgement have not commented or indicated whether they will appeal GVH's decision.