CMA provisionally finds construction firm cartels rigged £150m of contracts

A group of 10 construction firms illegally colluded to rig bids for £150 million of major contracts, according to provisional findings by the UK competition watchdog.

The Competition and Markets Authority (CMA) said eight of the firms involved in the cartels have admitted to taking part.

The rigged contracts for demolition services included work for Selfridges, Oxford University and the redevelopment of Bow Street’s magistrates’ court and police station in central London.

Fines will be handed to businesses involved if the watchdog concludes in its final decision they have broken the law, the CMA said.

The regulator said it “should not be assumed” that the firms involved definitely broke the law until the end of its investigation.

It comes after the CMA launched an investigation into the firms in 2019.

On Friday, the regulator said it has “concluded that the firms colluded on prices through illegal cartel agreements when submitting bids in competitive tenders for contracts”.

It found the bids were rigged with the deliberate intention of deceiving the customers that they were competitive, when it was not case.

The construction firms worked together, with firms agreeing to submit bids which were deliberately priced to lose the tender.

The CMA provisionally found that seven of the firms, on at least one occasion each, were involved in arrangements by which the designated losers of the contracts were set to be compensated by the winner.

It said eight firms have admitted their involvement in at least one instance of bid rigging between 2013 and 2018: Brown & Mason, Cantillon, Clifford Devlin, DSM, JF Hunt, Keltbray, McGee, and Scudder.

Two other firms – Erith and Squibb – have not admitted being involved.

Michael Grenfell, the CMA’s executive director for enforcement, said: “The construction sector is hugely important to Britain’s economic well-being.

“Bid rigging can result in worse deals, which can leave businesses – and sometimes taxpayers – out of pocket.

“This is unacceptable, and the CMA won’t hesitate to come down hard on these activities and impose appropriate fines.”