Examining the Aftermath: Saxony-Anhalt Discusses Potential Damages from Illegal Cartel Agreements
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Following the imposition of a cartel fine: Nation assesses potential compensation claims - Post-Cartel Compensation Claims Reviewed by State
In the wake of hefty fines dished out by the Federal Cartel Office against a number of road construction companies for engaging in shady cartel agreements, authorities in Saxony-Anhalt are now scrutinizing potential damage claims. The state road authority is busy determining which contracts were in place with the implicated companies, as per communications from the infrastructure ministry. After this assessment, damages claims, if any, will be evaluated. A meeting between federal and state governments towards the end of May will also focus on this issue.
The Federal Cartel Office broke the news on Tuesday that seven German road construction firms had colluded for several years in tendering for public authorities’ work. Among the culprits was a company based in Landsberg, Saalekreis. The cartel activity occurred between 2016 and 2019, predominantly affecting tenders in Saxony, Saxony-Anhalt, Thuringia, Brandenburg, and Mecklenburg-Vorpommern.
Breach of Competition Laws
The companies had been siphoning off hundreds of road repair and maintenance contracts for public authorities over an extended period, according to Andreas Mundt, president of the Federal Cartel Office. This blatant violation of competition laws can result in significant losses for public authorities, ultimately meaning citizens bear the brunt of the losses. The violations impacted numerous tenders and contracts of public authorities such as municipalities and state road authorities. This included even simple road resurfacing jobs.
The Federal Cartel Office has now levied fines amounting to €10.5 million. However, affected municipalities and authorities can also sue the construction companies themselves. For instance, Altmarkkreis Salzwedel is mulling legal action. At present, no damage claims have been filed against any company implicated in the cartel agreement.
- Cartel agreement
- Federal Cartel Office
- Cartel fine
- Million-euro fine
- Damage claim
- Germany
- Saxony-Anhalt
- Saxony
Additional Insights:
- Known companies involved in the bid-rigging and customer allocation practices include: AS Asphaltstraßensanierung, Bausion Strassenbau-Produkte, Bitunova, Gerhard Herbers, Liesen alles für den Bau, Mainka Straßenunterhaltung, and MOT Müritzer Oberflächentechnik[1][2].
- The investigation, including a raid in September 2019, was conducted in cooperation with other authorities, and targeted contracts valued between €40,000 and €200,000[2].
- Prosecution offices may handle legal proceedings against individuals involved in the cartel conduct, suggesting ongoing or pending legal actions[2].
- The Bundeskartellamt’s aim is to address the broader impact of such cartels on public procurement processes, but specific damage claims related to these companies are not currently highlighted[2].
- In response to the illegal cartel agreements exposed by the Federal Cartel Office, the community in Saxony-Anhalt is considering damage claims from the affected contracts with implicated construction companies.
- As part of the federal government's ongoing discussions, a meeting will be held at the end of May to focus on potential damages resulting from the cartel activities in various industries, such as road construction.
- The financial burden of thousands of contract breaches due to the cartel agreements may lead to increased costs in the future for public authorities, which ultimately could impact local businesses and the general news landscape.
