Kier challenges cartel fines

By Chris Sleight29 June 2010

Kier is challenging the UK£ 17.9 million (€ 22 million) fine handed down last September by the UK competition regulator, the Office of Fair Trading (OFT).

Kier's argument to the Competition Appeal Tribunal in London, UK is that the fine is discriminatory and disproportionate. The contractor has argued that it is larger than necessary to deter collusion and does not account for the company's low profit margin or its early co-operation with the investigation.

The fine followed the UK's biggest ever anti-trust investigation, which saw the OFT impose fines totalling UK£ 129,5 million (€ 160 million) on 103 construction contractors. The companies were found guilty by the OFT of colluding on some 199 tenders between 2000 and 2006. Kier's fine of UK£ 17.9 million (€ 22 million) was the largest for any individual company

The most common practice highlighted by the OFT was cover pricing - submitting a high bid with the intention of not winning a contract, but staying in favour for future work - however, in some cases there was evidence of harder collusion, such as contractors colluding over bids to allocate work.

The OFT said it would vigorously defend the fines.

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