Fines and liability amounts imposed for concluding agreements in the industrial construction sector

The Bundeskartellamt has imposed fines and liability amounts totalling around 4.8 million euros against 14 construction companies and 12 responsible persons for illegal bid rigging in award procedures for construction contracts.
The bid-rigging agreements concerned 42 contracts totalling 24 million euros awarded by Hüttenwerke Krupp Mannesmann GmbH (hereafter: HKM) between August 2011 and November 2016 (HKM proceedings), 122 contracts totalling 32 million euros awarded by ThyssenKrupp Steel Europe AG (hereafter: TK) between March 2007 and February 2017 (TK proceedings) and 14 contracts totalling 4 million euros awarded by Deutsche Edelstahlwerke GmbH (hereafter: DEW) between 2014 and late 2016 (DEW proceedings).

Andreas Mundt, President of the Bundeskartellamt: “For years the companies concerned maintained a system of mutually agreeing on who would be awarded which construction contract, to the detriment of the contracting entities. The agreements followed the same pattern in all three proceedings: First, the participating companies agreed in person or over the phone on who was to secure a particular contract. The company which was to get the contract then made its own calculations. The next step was to send these calculations to the other participating companies to make sure they would make higher sham offers to secure the contract for the agreed company.”

The following companies were fined:

• BeMo Tunnelling GmbH, Innsbruck (Austria), hereafter: BeMo,
• Echterhoff-Holland Hoch- und Tiefbau GmbH, Bochum, hereafter: Echterhoff,
• Eiffage Infra-West GmbH, Borken (operating under the name Heinrich Walter Bau GmbH until 15 June 2020), hereafter: Eiffage,
• Fenne Baugesellschaft mbH, Gladbeck, hereafter: Fenne,
• Gehrken Straßen- und Tiefbau GmbH & Co. KG, Dortmund, hereafter: Gehrken,
• IH Inpako GmbH, Teutschenthal (operating under the name WMB Wilhelm Maas Baubetriebe GmbH until 23 October 2019), hereafter: Maas,
• IHT Ingenieur-, Hoch- und Tiefbau GmbH, Bochum, hereafter: IHT,
• Karger Straßen- und Tiefbau GmbH, Witten, hereafter: Karger,
• Korte GmbH + Co. KG, Witten, hereafter: Korte,
• Mainka Bau GmbH & Co. KG, Lingen (operating under the name Bauunternehmung August Mainka GmbH & Co. until 9 January 2020), hereafter: Mainka,
• Möllmann Straßen- und Ingenieurbau GmbH + Co KG, Dortmund (operating under the name Möllmann GmbH + Co Straßen-Tiefbau KG before 9 December 2016 and then under the name Kramer Straßen- und Ingenieurbau GmbH + Co KG until 3 May 2017), hereafter: Möllmann,
• Rostek & Pesch GmbH & Co. KG, Krefeld, hereafter: Rostek & Pesch,
• T&M Baugesellschaft mbH, Wesel (operating under the name PE-LA Baugesellschaft mbH until 6 January 2011), hereafter: T&M.

The proceedings were initiated following a leniency application by Hermann Kassens Bauunternehmung GmbH, Papenburg. The proceedings against this company were discontinued in application of the leniency programme.

Furthermore, fines and liability amounts were set against AKM Verwaltungsgesellschaft mbH, Moers, hereafter: AKM. Until 10 July 2019, AKM was the parent company of cartel participant Maas. Maas discontinued its business operations during the administrative offence proceedings; its company shares were subsequently transferred for a purchase price of one euro to an external company which did not belong to the group of companies Maas had belonged to up to that point. As a consequence, the Bundeskartellamt decided to for the first time apply its powers to impose company fines and liability amounts, which were introduced in 2017. In cases where companies are restructured after 9 June 2017, which is when the 9th amendment to the German Competition Act (Gesetz gegen Wettbewerbsbeschränkungen – GWB) came into force, these powers enable the authority to impose fines or liability amounts against the parent companies. If the competition law infringement was already terminated when the 9th amendment to the GWB became effective, the Bundeskartellamt can only impose liability amounts. Unlike fines, liability amounts do not entail offence allegations. Depending on whether or not the specific agreements had been terminated by the effective date of the 9th amendment to the GWB in 2017, liability amounts pursuant to Section 81e GWB or company fines pursuant to Section 81(3a) GWB 2017 (today Section 81a(1) GWB) were determined in all three proceedings.

Andreas Mundt: “The powers to determine company fines and liability amounts introduced with the 2017 GWB amendment have proven an effective tool to make sure companies do not evade fines by cleverly restructuring their companies. The legal loophole known in Germany as the “Wurstlücke” has therefore been closed for good.”

The companies BeMo, Eiffage, Fenne, IHT, Maas, Mainka and Rostek & Pesch were fined for participating in anti-competitive agreements in the HKM proceedings. The companies Echterhoff, Eiffage, Fenne, Gehrken, Maas, Möllmann and T&M were fined in the TK proceedings. In the DEW proceedings the companies Fenne, Karger, Korte and Maas were fined (see case summaries for details on the three proceedings).

All decisions regarding fines and liability amounts are final. All companies except Mainka and Rostek & Pesch cooperated in the course of the proceedings and filed for leniency. Furthermore, all companies except Fenne agreed to a settlement. Fenne only agreed in part to a settlement in the HKM proceedings.

Section 298 (Collusive tendering) of the German Criminal Code (Strafgesetzbuch – StGB) does not apply to the offences sanctioned by the Bundeskartellamt. While this Section does not only apply to public tenders, private tenders are only subject to Section 298 StGB if they comply with basic public procurement principles, which was not the case here.