Agreements in the concrete pipe sector - Bundeskartellamt imposes multi-million fines

Today the Bundeskartellamt imposed fines totalling € 11.86 million on two manufacturers of concrete pipes and five individuals. The companies are Berding Beton GmbH, Steinfeld, and Betonwerk Bieren GmbH, Bad Oeynhausen. Since at least 2006, the companies had agreed on prices, quota and the allocation of individual orders and had carved up among themselves the regional market for concrete pipes in their mutual distribution area. The Bundeskartellamt is also conducting investigations against 13 other manufacturers of concrete pipes on suspicion of price fixing. In February 2010, the Bundeskartellamt followed up information provided by a competitor and conducted searches at several premises of Berding, Bieren and two other manufacturers located in Northern Germany.

The President of the Bundeskartellamt, Andreas Mundt, stated: "For many years the companies have systematically hindered competition in the market, thereby causing considerable damage. To implement the cartel agreement the companies have undertaken a huge organisational effort - for example there is proof that more than 100 personal meetings took place between employees of the two companies".

The cartel agreements lasted at least from January 2006 to February 2010, when the Bundeskartellamt conducted its searches. They concerned the manufacture and sale of standard concrete components (pipes and sewers) for rain and wastewater drainage. In geographic terms, the cartel agreement mainly covered the territory of the federal states of Lower-Saxony, Bremen and North Rhine-Westphalia, as well as fringe areas of Rhineland Palatinate and Hesse. The ongoing investigations of the Bundeskartellemt against further manufacturers are focused on markets in the centre and north of Germany, but not on markets in Bavaria, Baden-Württemberg and the Saarland.

The sector consists mainly of small and medium-sized companies, there are no manufacturers that operate nationwide. This is so because the transport of the products is cost-intensive and different types of pipes are demanded in the individual regions in Germany (e.g. pipes with a base as opposed to circular pipes without a base), which can only be bought at certain manufacturers.

The companies Berding and Bieren had agreed on minimum prices for all standard components and divided business up among themselves under a quota system. In regular meetings the sales managers allocated the individual construction projects on the basis of so-called object lists. The cartel members implemented their market sharing agreement by agreeing on what rebates to offer with their bids.

The orders imposing the fines are not yet final and can be appealed against at the Düsseldorf Higher Regional Court. An agreement to end the proceedings by settlement was reached with Bieren. Both companies have cooperated with the Bundeskartellamt in the proceedings which has led to a reduction of their fines in line with the authority's lenience programme.