Three groundworks firms named in CMA probe

9 April 2019 | By Neil Gerrard

Three groundworks products companies have been named in an investigation conducted by the competition watchdog, the Competition and Markets Authority (CMA).

The CMA has issued a statement of objections setting out its provisional findings that the three firms – M.G.F. (Trench Construction Systems) Ltd, Mabey Hire Ltd and Vp plc – broke competition law by co-ordinating to keep prices up.

This included sharing confidential information on pricing and commercial strategy and coordinating their commercial activities.

The CMA alleged in its provisional findings that Vp and MGF operated the cartel for periods totalling nearly two years and Mabey took part for a single period of five months.

The allegations came to light after Mabey blew the whistle and brought information about the conduct to the CMA’s attention. Mabey will now not be fined, in accordance with the CMA’s leniency programme – provided it continues to cooperate with the CMA’s investigation.

Michael Grenfell, the CMA’s executive director for enforcement, said: “These are three major suppliers of equipment used to keep construction workers safe. It is crucial that builders and their customers benefit from genuinely competitive pricing for this essential equipment.

"Everyone must follow competition law, which protects customers from being exploited and paying more, as well as encouraging companies to compete for business in other ways – through innovation, quality and service.”

The CMA’s findings are, at this stage in its investigation, provisional and do not necessarily lead to a decision that the companies have breached competition law. The firms now have the opportunity to consider the detail of the CMA’s provisional findings and respond to it.

This latest investigation by the CMA is one of several running in the construction industry. Last month, it fined five office fit-out companies a total of £7m for breaking competition law and also announced in March that it was launching a new investigation into anti-competitive arrangements in the sector.

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