Contractors fined £129.5m for price-fixing

22nd Sep 2009 07:06

More than a hundred of the UK's leading building contractors including Balfour Beatty, Kier and Carillion were landed with fines today by the Office of Fair Trading after a four-year investigation into collusion and price-fixing in the building industry.Balfour Beatty was fined £5.2m, Carillion £5.3m, but Kier's fine was especially heavy at £17.9m. In total, the OFT fined 103 firms a total of £129.5m following the investigation that looked into allegations of price rigging in building contracts worth as much as £3bn.There will be some relief, however, that the fines were not worse. The OFT has the power to impose fines of up to 10% of turnover against firms operating a cartel, but today's fine is about 1-2% of sales anaysts estimate.The OFT reportedly had been under intense pressure to reduce the penalties because of the damage the industry has suffered in the recession.Eighty-six out of the 103 firms received reductions in their penalties because they admitted their involvement in cover pricing prior to today's decision, the OFT said.The OFT has also informed nine companies originally listed that it will not pursue allegations of bid-rigging against them as it considers it has insufficient evidence to proceed to an infringement finding.