Price Fixing Part 2- The "Cartels"

Following a three-year investigation the Office of Fair Trading has accused 112 construction companies of bid-rigging. It says that Government agencies and local authorities are clients who may have overpaid on billions of pounds of building contracts.

The list of companies accused of bid-rigging include Balfour Beatty, the UK's biggest construction company and builder of the 2012 Olympic aquatics centre in London, and Carillion, the second biggest company.The allegations cover a wide range of construction projects in both the public and private sectors mainly in Yorkshire and Humberside.

During the investigation raids have been carried out on almost 60 companies in the search for evidence and 77 companies have volunteered information in an effort to qualify for leniency if fines are imposed.

The contractors now have two months to make written and oral representations to the OFT before it makes a final decision in early 2009 on whether or not competition law has been infringed and how much the companies will be fined.

The OFT has powers to impose fines of up to 10pc of a company's worldwide turnover.
It claims to have uncovered evidence of bid-rigging involving hundreds of tenders with a combined value of almost £3bn.

John Fingleton, OFT chief executive, said: "Cartel activity of the type alleged today harms the economy by distorting competition and keeping prices artificially high. Businesses have no excuses for not knowing and abiding by the law."

To read the full OFT staement click here