Five property refurbishment firms have been fined more than £7 million for breaking competition laws, a report has revealed.
Appearing before a court earlier this year, Fourfront, Loop, Coriolis, ThirdWay and Oakley have agreed to pay the fines after admitting to being involved in cartel behaviour.
The ruling follows an investigation carried out by the Competition and Markets Authority (CMA), which found that each company had broken competition rules at least once during the period between 2006 and 2017.
According to the investigatory report, each firm – which provides design and refurbishment services for commercial and non-residential premises – had admitted to participating in “cover bidding” in competitive tenders.
Cover bidding usually involves companies agreeing with each other to place bids that are deliberately intended to lose the contract, allowing a competitor’s quote to stand out despite not necessarily representing value for money.
The CMA said this type of illegal activity can often lead to consumers paying an “artificially inflated price” or “receiving poorer quality services”.
The investigation found that the five firms had participated in cover bidding in up to 14 contracts, with customers ranging from a law firm to a further education college.
Under the Competition Act 1998, companies can be fined up to 10 per cent of their annual worldwide group turnover, while directors of the companies concerned can be banned from holding directorships for up to 15 years.
Commenting on the investigation, Andrea Coscelli, the CMA’s Chief Executive, said: “The CMA is concerned it is seeing a lot of evidence of anti-competitive conduct in the construction industry, and we have already taken a number of cases in this sector. Today’s fines reinforce the message that the CMA will not tolerate competition law being broken.
“As shown by the total of £7 million in fines agreed today, we will not turn a blind eye to illegal behaviour and we will take action where we find laws have been broken. This can include seeking disqualification of company directors.”