Japan’s bridge builders fined

25 April 2008

Tokyo’s High Court has ordered 23 construction companies to pay YEN 6.48 billion (US$ 56 million) in penalties for rigging bids in tenders for bridge building projects financed by the state and the now defunct Japan Highway Public Corp.

The court found former Japan Highway executive Sozo Kanda, 72, and seven other former company officials guilty of rigging bids and sentenced them to suspended prison sentences ranging from 12 to 30 months. Mr Kanda, who was also an adviser to Yokogawa Bridge Corp, received a suspended two-year prison term.

State prosecutors had alleged that Yokogawa Bridge and Kawada Industries Inc organised the bid rigging. Both companies received the heaviest fines, YEN 800 million (US$ 6.9 million) each, a record high for breaking Japan’s Antimonopoly Law. Ishikawajima-Harima Heavy Industries Co and JFE Engineering Corp, were each fined YEN 600 million (US$ 5.2 million).

The other 19 companies, which include Mitsui Engineering and Shipbuilding Co., Sumitomo Heavy Industries Ltd., Hitachi Zosen Corp., and Kawasaki Heavy Industries Ltd, were each fined between YEN 200 and 350 million (US$ 1.7 and 3 million).

The allegations first surfaced in October 2004 when Japan’s Fair Trade Commission (FTC) raided the offices of about 70 contractors. This resulted in 12 individuals and 26 corporations being indicted.

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