UK competition authorities fine groundworks companies

The UK’s Competition and Markets Authority (CMA) has fined Vp plc and MGF (Trench Construction Systems) £11.2m and £3.7m respectively for price fixing in the trenching and shoring business over a two-year period.

A third company, Mabey Hire, was found to have colluded in the cartel for five months but has not been fined because it alerted CMA to the activity.

The fine for VP plc relates to its Groundforce division.

Vp plc said it would appeal the ruling; “Vp fundamentally disagrees with the conclusions of the CMA and based on the board’s current view of the information available it is our intention to appeal to the Competition Appeal Tribunal (CAT).

“Notwithstanding, the Group’s view of the merits of the CMA’s findings, Vp has always prided itself on conducting its business fairly and ethically. The board is committed to ensuring that our policies and procedures are adhered to by all Vp employees.”

Vp made a provision of £15.4 million for potential fines in its most recent accounts.

CMA said it had found that the companies had colluded illegally to reduce competition and maintain or increase prices, including sharing information on future pricing and commercial strategy.

Michael Grenfell, Executive Director of Enforcement at the CMA, said; “Today’s announcement shows that the CMA continues to crack down on illegal cartel behaviour and protect consumers. The CMA will not tolerate illegal conduct which weakens competition and keeps prices up at the expense of consumers.

“This is the fourth time in the last two years that the CMA has fined a cartel in the construction sector. It is essential that the sector, which is crucial to the success of our country’s economy, can benefit from a competitive marketplace to deliver value, innovation and quality.”