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Construction cartel: Pittel + Brausewetter fine of EUR 4.81m million final

On 21 February 2023, the Austrian Federal Competition Authority filed an application for a fine to be imposed on Pittel + Brausewetter GmbH. On 9 May 2023, the Cartel Court imposed a fine of EUR 4.81 million as requested by the AFCA. The decision is now final.

At the AFCA’s request (see press release of 22 February 2023), the Cartel Court has now imposed a fine of EUR 4.81 million on Pittel + Brausewetter (GZ 26Kt 3/23w). The company was found to have committed a single and continuous infringement of cartel law during the period from at least July 2002 to October 2017, with the infringement taking the form of illegal price fixing, market divisions and the exchange of information with competitors in relation to public and private tenders in the sector of building construction and civil engineering in Austria.

Pittel + Brausewetter has cooperated with the AFCA outside the leniency programme to fully clarify the facts of the case. During settlement talks with the AFCA and the Federal Cartel Prosecutor, Pittel + Brausewetter acknowledged the infringement for use in proceedings before the Cartel Court. The AFCA therefore applied for a reduced fine. The projects carried out with Pittel + Brausewetter’s direct involvement were mostly located in the provinces of Lower Austria, Vienna and Burgenland.

Previous AFCA investigations into the construction industry

Several companies that were members of the construction cartel were engaged in concerted practices with the aim of helping each other to win construction contracts and thus secure market shares and increase their margins. The cartel covered the entire Austrian territory, albeit to varying degrees depending on the company involved. In spring 2017, the AFCA carried out dawn raids together with the Central Public Prosecutor for Economic Crime and Corruption (WKStA) as part of its investigations into the construction industry, in the course of which it also impounded large amounts of data.

In autumn 2019, the AFCA submitted its initial statements of objections to the companies concerned. A statement of objections is a formal step in AFCA investigations, informing the companies concerned in writing of the objections raised against them. Further investigations into numerous other companies are ongoing. The Cartel Court has already imposed fines on several companies, with various other cases still pending. 

For more information please download our FAQ Construction Cartel Update July 2023.

Fines for cartels

The Austrian Federal Cartel Act prohibits any behaviour that prevents or distorts competition. This covers price fixing agreements or the division of markets or territories. At the AFCA’s request, the Cartel Court may impose fines of up to 10% of an entity’s total turnover generated in the preceding business year if that entity is found to have breached the rules banning cartels. Fines are determined on the basis of the gravity and duration of the breach, the degree of fault, and the economic strength and cooperation of the company concerned.