NMa: Fines cable and piping constructors and providers of horticultural services for cartel offences

The Netherlands Competition Authority (NMa) has fined 69 undertakings in the cable and piping sector for a total of more than EUR 11 million on the grounds of an infringement of the Competition Act. Also, fines have been imposed on 54 undertakings providing horticultural services. As regards these undertakings, fines amounted to a total of more than EUR 3 million. The imposed fines varied for each undertaking from almost EUR 1.400 to EUR 2.6 million in the cable and piping sector, and from more than EUR 1.100 to EUR 356.000 in the horticultural sector. The sanctions are based on information which the NMa received after a joint appeal of the NMa and the Cabinet calling on undertakings to 'come clear'. Evidence was also gathered from sources elsewhere.

Cable and piping constructors
In the period ranging from 1 January 1998 to the end of 2001, constructors of cable and piping met for consultation in varying groups prior to tendering for contract in procurement procedures involving cable and network systems. These meetings were interconnected and constituted a system with national coverage. This system focused on dividing orders among participants and coordinating bidding practices. The fined undertakings represent a substantial part of the total number of undertakings dealing with the construction, installation, renewal and maintenance of underground and ground-level cable and piping systems. These cable and piping systems allow for the transport of gases, liquids and electricity and provide for the transmission of telecommunications and radio and television signals. These undertakings also install and renew meters, such as water, gas and electricity meters. In the sanctions procedure evidence was used which had been handed over to the NMa by 22 undertakings as part of a leniency request.

Horticultural services
The NMa also imposed fines on 54 undertakings active in the horticultural sector. The NMa considers it proven that, in the period ranging from January 1998 to the end of 2001, these undertakings participated in consultations prior to tendering for contract in procurement procedures involving horticultural services. The aim of these consultations was to divide work among participants and coordinate bidding practices. Horticultural services include horticultural consulting and design, garden planning and grounds maintenance, fence construction and facing, as well as hiring out employees to provide horticultural services. In the horticultural sector, 13 undertakings submitted a leniency request.

Accelerated sanctions procedures
In November 2005, the NMa issued statements of objection against the undertakings involved, on the grounds of their participation in a cartel structure in the cable and piping sector and the horticultural sector. In drawing up the sanctions decisions, the NMa followed accelerated sanctions procedures in order to allow companies to 'come clear' quickly. This procedure entailed that the undertakings were not heard individually, but were given the opportunity to put forward their reaction to the statements of objection collectively via their representatives, Mr J.C. Blankert (cable and piping constructors) and Mr H.Ph.H. Haverkort, president of the Dutch Horticultural Society [Vereniging van Hoveniers en Groenvoorzieners]. More than 90% of the undertakings involved chose to participate in the accelerated sanctions procedure. The NMa has reduced the fines imposed on these undertakings by 15%, because of their participation in the accelerated sanctions procedure.
The undertakings have to pay the imposed fines within thirteen weeks. As for now, an amount of almost EUR 2 million has already been paid or guaranteed. Fine payments received by the NMa are forwarded to the Treasury.

Progress made in investigations into construction industry
Up until now, the NMa has sent statements of objection to approximately 1450 undertakings in the construction industry and related sectors, on suspicion of an infringement of the Competition Act. Fines have been imposed on approximately 650 of these (construction) companies. The competition enforcer expects to draw up the majority of fining decisions in the accelerated sanctions procedures in July at the latest. This means that for all subsectors in the construction industry the accelerated procedures have been rounded off by now or have reached a final stage. It is no longer possible, therefore, for companies to register for the accelerated procedures, insofar as they have not already done so. Decisions resulting from regular procedures, which have now been initiated for all subsectors, are to follow before the end of the year.

The NMa will continue monitoring the construction sector for compliance with the prohibition on cartels. Undertakings suspecting an infringement of the Competition Act other than the ones already established within the construction sector, may report this to the NMa Information Line (0800-0231885). Undertakings that report information on cartels in which they participate or have participated themselves, may submit a request for leniency. On the basis of a leniency request, undertakings may be granted immunity from fining or a reduction of the fine ('leniency'), if they inform the NMa of cartels in which they have themselves participated. It is conditional that undertakings report with the Leniency Office on an individual basis and pass on valuable information. With a view to this, the NMa has drawn up guidelines. The Leniency Office may be contacted via 070 330 1710 (telephone), 070 330 1700 (fax) or email: clementie [at] acm [punt] nl (clementie[at]acm[dot]nl).