February 27, 2020

Price fixing laws widely misunderstood within construction sector

News Article

New research suggests that three out of ten construction companies believe there is nothing wrong with price fixing.

Research carried out by the Competition and Markets Authority (CMA) has also revealed that a quarter of companies felt discussing bids and tenders was not a problem, whilst almost a third believed an agreement between firms to avoid supplying to each other’s customers was acceptable.

The CMA is now campaigning to raise awareness of anti-competitive practices and has pledged to continue taking legal action against companies that break the rules. In 2019, the CMA handed down fines of around £43million to companies that breached competition laws.

Howard Cartlidge, the CMA’s Senior Director of Cartels, said: “The CMA is cracking down on businesses that collude to rip off customers by fixing prices, sharing out markets amongst themselves or rigging bids.

“Our message to them is that we know cheating when we see it, even if you don’t.

“Pleading ignorance is no defence; it’s up to businesses to know what these unfair practices look like and avoid them.

“By ensuring you stay on the right side of the law, you can avoid substantial fines, director disqualification or jail.

“And if you suspect something illegal is going on, report it to us before it’s too late.”

Adam Davis, a Partner with Palmers, who specialises in construction disputes and litigation, said: “The CMA’s new campaign demonstrates that it is determined to create a level playing field for suppliers operating in the construction and engineering sectors.

“Price-fixing is illegal and any company director or owner found guilty of such an offence can face up to five years in prison and significant fines. Companies found guilty of operating illegal cartels can be fined up to 10 per cent of their annual turnover.

“Anyone operating in the construction or engineering industry who suspects underhanded, illegal business practices, should seek specialist legal advice.”

For help and advice on all aspects of construction and engineering litigation and dispute resolution, please contact us.