German competition watchdog imposes €110m in fines for M&E bid-rigging

The Bundeskartellamt, Germany’s competition regulator, has levied fines totalling €110m against 11 contractors after finding they colluded on bids for major contracts.

The regulator found collusion in 37 contract award procedures between 2005 and 2014, in which bogus bids for work were submitted to favour a designated contractor.

The five-year investigation was triggered when one of the firms applied for leniency.

It did this after learning that the German media was about to report on collusion on the award of a contract for coal-fired power plants in Hamm-Uentrop in Germany and Eemshaven in the Netherlands.

After the articles were published, three other companies came forward to cooperate with the Bundeskartellamt and seek a reduction in their penalties.

Andreas Mundt, president of the Bundeskartellamt, commented: "Often only fictitious bids were submitted to protect other providers. In return for submitting these bogus quotes the companies in many cases received specific services such as subcontracts, compensatory amounts or were offered cover quotes in another tender procedure. In all we have proved anti-competitive practices in 37 award procedures in the period from 2005 to 2014".

The authority launched an investigation with the Munich Public Prosecution Office and the Munich Criminal Investigation Department.

In February and March 2015, dawn raids were conducted at several companies and private residences. The Public Prosecution Office then began action against individuals involved and the Bundeskartellamt led proceedings against the companies.

The bids involved mechanical and electrical and fire protection work for power plants, industrial installations, shopping centres and office buildings. Most cases involved mechanical engineering and the contracts had values of between €4m and €35m, although one was worth €100m.

The companies are: Caverion Deutschland of Munich; DS Elektrotherm of Landshut; Engie Deutschland of Cologne; Engie Gebäudetechnik of Vienna; Ferrostaal Air Technolgy of Saarwellingen; Karl Lausser and Heizungsbau und Sanitär of Rattiszell; Kraftanlagen München; Nickel of Bergisch Gladbach; Sell of Helmbrechts; Siegle + Epple of Stuttgart and Stingl of Munich.

The Bundeskartellamt said Caverion Deutschland, Nickel, Ferrostaal, Stingl, Siegle + Epple and Engie Deutschland had cooperated with the authority in uncovering the agreements and were granted leniency.

It added that Kraftanlagen Münche, Karl Lausser, Heizungsbau und Sanitär and Sell had each appealed the decisions to the Düsseldorf Higher Regional Court.

Image: The Bundeskartellamt headquarters in Bonn (Eckhard Henkel/CC BY-SA 3.0 DE) 

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