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Wed November 13 2019

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Drainage cartel hit for £36m fines

23 Oct Three producers of pre-cast concrete drainage products have been issued with fines totalling more than £36m for breaking competition law.

Stanton Bonna, FP McCann and CPM colluded to divide up the market between them at the expense of their construction industry customers.

Derbyshire-based Stanton Bonna Concrete Ltd and Somerset-based CPM Group admitted their misdeeds last December after the Competition and Markets Authority (CMA) began probing. FP McCann, headquartered in Northern Ireland, did not – and has consequently got the heaviest fine of the three.

Stanton Bonna has been fined nearly £7.5m and CPM £4m, while FP McCann has been hit for a whopping £25m.

The CMA found that from July 2006 to March 2013, the three companies agreed to fix or coordinate their prices, shared the market by allocating customers and regularly exchanged competitively sensitive information.

These arrangements continued for nearly seven years and involved meetings attended by senior executives from each of the firms. The CMA recorded a number of these meetings and used them as evidence when arriving at its final decision.

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CMA chief executive Andrea Coscelli said: "These companies entered into illegal arrangements where they secretly shared out the market for important building products and agreed to keep prices artificially high. This is totally unacceptable as it cheats customers out of getting a good deal.

"The CMA will not hesitate to issue appropriately large fines in these cases and we will continue to crack down on cartels in the construction sector and in other industries."

The precise fines for each of the firms were:

In calculating fines, the CMA takes into account a number of factors including seriousness and duration of the infringement, turnover in the relevant market and any mitigating/aggravating factors.

CPM and Stanton Bonna were handed reduced fines because they admitted their involvement in cartel activity and cooperated rather than hold up the investigation and add to its expense.

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MPU

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