German cartel office cracks down on road repair collusion
The Federal Cartel Office in Germany has imposed fines on seven road companies after discovering that they were merely pretending to compete for contracts while actually colluding. This collusion allowed them to secure more lucrative contracts, to the detriment of public finances.
The Federal Cartel Office fined these seven companies in the road repair industry due to illegal agreements related to public contracts, as reported by Deutsche Welle. These companies were active in various federal states, including Brandenburg, Saxony, and Mecklenburg-Vorpommern.
The president of the Federal Cartel Office, Andreas Mundt, stated that the companies had agreed among themselves which one would receive the contract, while another would submit a "protective offer" with a predetermined minimum amount as a decoy.
The head of the office emphasised that such practices damage competition and result in losses for the public sector, which "ultimately all citizens would have to bear".
President of the federal cartel office
This scheme was in operation from 2016 to 2019. The case was investigated by the Federal Cartel Office and the Düsseldorf prosecutor's office. One of the entrepreneurs cooperated as a key witness. The companies proven to have colluded must pay a total of €10 million (£7.6 million).
What did the road workers' collusion look like in practice? Deutsche Welle reports that a "coded language" was used to determine who would submit the proper bid and who the "protective" one.
The collusions primarily involved straightforward road repairs and the supply of bituminous emulsion.
