A Dark Chapter in Road Construction: Unlawful Collusion in Tenders Unearthed, Costing Millions in Penalties
Unlawful Collusion in Road Construction: Federal Cartel Authority Levies Millions in Penalties - The Regulatory Authority on Competition Levied a Heavy Penalty of Millions on the Suspect Entity
Let's talk street duty - road construction, that is. What's the deal with all these allegations of cartel agreements in the business, you ask? Well, buckle up!
Apparently, a whopping four companies were under scrutiny by the Federal Cartel Office (FCO) for some shady activities behind the scenes. The cat’s outta the bag, thanks to Andreas Mundt, President of the Bonn-based FCO, who spilled the beans about these agreements between 2016 and 2019.
"Before tenders, it was decided who'd take the prize," Mundt humorously explained. This group exercise involved other companies submitting what they call 'cover bids' with predetermined minimum amounts, leaving only one winner.
Mundt stressed why this is a big no-no: "Effective competition is crucial for the public sector to get quality stuff at a reasonable cost." But, illegal cartels can wreak havoc, as we all end up footing the bill.
In 2018 and 2019, these four naughty companies divided the clients in Saxony, Thuringia, and Saxony-Anhalt. A secret language was used to determine who's tendering what and who's submitting cover bids. Not very James Bond-ish, but still shady nonetheless!
Fast forward to a since-colluding bunch of companies in Brandenburg and Saxony-Anhalt, sometimes even joined by Mecklenburg-Vorpommern. Talk about a league of villains!
These tenders mainly involved simple road repairs, supplying bitumen emulsion, or gravel. Contracts typically ranged from 40,000 to 200,000 Euros.
In a dramatic turn of events, the FCO, in cooperation with the Public Prosecutor's Office in Düsseldorf, raided several companies in 2019. One company owned up to its sins, taking advantage of the leniency program.
- Unlawful Collusion in Tenders
- Federal Cartel Office
- Millions in Penalties
- Road Construction
- Andreas Mundt
- Bonn
- Saxony-Anhalt
- The Federal Cartel Office, led by Andreas Mundt, revealed unlawful collusion in road construction tender bids between 2016 and 2019, with several companies in Saxony, Thuringia, and Saxony-Anhalt being involved, resulting in millions in penalties.
- Given the alarming occurrence of unlawful collusion in road construction, it is essential for community policy to focus on vocational training in industry sectors such as manufacturing and finance, ensuring a competitive business environment that promotes fair bidding practices.
