Watchdog accuses three construction suppliers of forming a cartel to keep prices up
The competition watchdog has found that three construction suppliers colluded to form a cartel and keep prices up.
The Competition and Markets Authority (CMA) said its investigation into groundworks suppliers MGF, Vp and Mabey Hire has provisionally found that the trio broke competition law.
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It said the cartel involved sharing confidential information on pricing and commercial strategy.
The three firms supply groundwork products – to protect excavations from collapse – for major housing and road developments as well as railway works.
The CMA said Vp and MGF operated the cartel for almost two years and Mabel joined for five months.
It said a whistleblower came forward and that Mabey has since confessed and would not be fined.
The firms will now be able to respond before the watchdog issues its full findings.
The CMA’s executive director for enforcement, Michael Grenfell, 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.”
He added: “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.”
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Shares in Vp fell six per cent in early trading.
The company noted the findings and said it related only to its excavation support systems business, adding it would cooperate fully with the CMA.