In line with the regional focus of their activities, Leyrer + Graf were directly involved in illegal price fixing, market divisions and the exchange of information with competitors in relation to public and private construction tenders, in the province of Lower Austria in particular. The infringements occurred from at least January 2007 until May 2017. Some construction projects in Upper Austria, Carinthia, Styria and Burgenland were also affected. Due to the comparatively shorter period and the regional focus of their activities, Leyrer + Graf have been classed as joint participants in the overall infringement.
Leyrer + Graf’s actions are part of the wider infringement of cartel law that has occurred across the whole of Austria. The large number of arranged construction contracts cover both building construction and civil engineering projects throughout Austria, with road building projects predominating. The collusive behaviour was aimed at reducing or excluding competition, helping each other to win construction contracts and thus securing market shares. Numerous companies were involved in the cartel, but to varying degrees. The AFCA applied to the Cartel Court for a fine of EUR 5.8 million to be imposed on Leyrer + Graf.
Leyrer + Graf cooperated with the AFCA outside the leniency programme to fully clarify the facts of the case, acknowledging the infringement for use in proceedings before the Cartel Court. The AFCA therefore applied for a reduced fine, with the involvement of the Federal Cartel Prosecutor. With regard to the amount of the fine, the company’s extensive efforts in relation to compliance were also taken into account.
Background
The uncovered cartel relates to the economic sector of construction, with a focus on road building projects.
The infringement covers the entire Austrian territory, albeit to varying degrees depending on the company involved. Both public and private clients were affected by these practices, as were a large number of construction projects. The investigations are still ongoing, while some of the proceedings have been finally concluded.
The companies involved in the infringement engaged in concerted action in order to help each other to win construction contracts, thereby securing market shares and utilising their capacities accordingly, among other things. To reach this common goal, they engaged in illegal price fixing and market divisions, exchanged competitively sensitive information – relating for example to agreements on future behaviour when submitting bids – and in some cases formed anti-competitive working groups and bidding consortia.
The involved companies also agreed on which bidder should win the contract, the price to be offered and the submission of bogus offers, as well as arranging that certain competitors would not submit any bid at all.
FAQ Construction cartel update December 2023
For further information and the latest developments regarding the construction cartel, please refer to our FAQ Construction cartel update December 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.