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NMa Starts Accelerated Sanctions Procedure against 700 Construction Companies in the Civil Engineering and Utilities Engineering Sector

The Netherlands Competition Authority (NMa) has started a sanctions procedure against about 700 construction companies active in the civil engineering and utilities engineering sector, due to an infringement of the prohibition on cartels. In order to bring the cases to a conclusion adequately and swiftly, NMa will apply an accelerated procedure. This procedure was applied earlier in relation to cartel structures in the civil engineering and infrastructure sector and in the installation engineering sector.

NMa's investigation has resulted in a report on the companies active in new construction projects and the maintenance of buildings. NMa suspects that they participated in a cartel structure in the period between 1998 and 2002. According to the report, they coordinated their bidding behaviour prior to tender procedures and together they agreed on the amount to be charged for calculating and preparing the bids which resulted in an increase in the bids submitted by the companies which participated in the tender.

The investigation was based largely on information received from approximately 230 companies which voluntarily notified NMa within the framework of the leniency programme. Evidence against the other companies emerged from this information and NMa's investigation, bringing the total number of companies to approximately 700. The 230 companies eligible for leniency will be granted a reduction in their fines of 30% to 50%. The value of the information provided by the applicants for leniency will be taken into account in determining this reduction. In addition, in the case of approximately 25 companies which submitted applications for leniency the application was refused because the information provided was not substantial enough.

The construction companies have now been given the opportunity to participate in the accelerated sanctions procedure. They have until 14 October 2005 to notify NMa that they wish to participate in the accelerated sanctions procedure. To give them an incentive to do so, NMa will grant a 15% reduction in the fines of companies which participate in the accelerated procedure.

NMa has opted for an accelerated sanctions procedure to ensure that NMa and the sector do not become embroiled in procedures which drag on for years. In addition, the regulator aims to contribute to a change of culture in the sector by bringing a swift conclusion to the investigation and through a quick sanctions procedure. This will enable all the construction companies involved to 'come clean' quickly.