ConferencesWhile more than a fifth of all complaints to the Competition Authority over the past five years have related to the construction sector, there have been no convictions against companies in the industry, a construction law conference has heard.
"Ireland has more cartel convictions than any other country in Europe, although as yet none of those convictions have been in the construction sector," said the head of EU and competition law at A&L Goodbody, Dr Vincent Power. He was addressing the company's annual conference on construction law, which took place last Thursday.
"However the EU, the Office of Fair Trading in the UK and the Dutch competition authority have all imposed fines on the construction sector. The Irish authority tends to follow the practice of other authorities, meaning that Irish companies in the construction sector need to be extra careful in ensuring they comply with competition law," Dr Power said.
Details showing that 22 per cent of all complaints to the Competition Authority are connected to the construction industry here come from the authority's publications over five years. This is the highest level of complaints received by any sector, Dr Power said. "Ireland was the first European country to implement criminal cartel enforcement successfully and there are now 18 convictions of companies and individuals."
Such a high level of conviction was partly due to Ireland introducing the legislation ahead of others and also the fact that the Irish legislation was more pro-prosecution than others.
"Any arrangement which has the object or effect of preventing, restricting or distorting competition in the market is anti-competitive. Everyone suffers because of breaches of competition law and the clear message now, after two suspended jail sentences being imposed in this country among 18 convictions in the last two years, is 'stop'," Dr Power said.
"Corporate Ireland is learning fast about the new tough competition rules and abiding by them for the benefit of corporations and companies alike."
Fines and penalties for breaching competition law could be substantial, he said. This includes imprisonment of up to five years, injunctions, declarations, damages and fines of up to 10 per cent of worldwide turnover.
In a February 2007 decision taken against the Otis, Kone, Schindler and ThyssenKrupp groups for operating cartels for the installation and maintenance of lifts and escalators, the European Commission imposed fines amounting to €992 million.
The European Commission said that managements in the cartel used pre-paid mobiles and met in the countryside and in bars so as to avoid detection.
"All firms need to be extra vigilant in their dealings with competitors and in communicating or exchanging information on plans, prices and aspects of their business," Dr Power said.
In a recent decision, a number of construction companies in The Netherlands were fined over €100 million for collusion. Evidence came to light when a disgruntled employee broke the story to the Dutch media and a television programme was broadcast.
Delegates at the A&L Goodbody conference were told that there were many construction companies which complied with competition law but now was the time that others should comply in full.
The conference also addressed the developments in construction law in the past year, and conditions of engagement for construction consultants, in addition to a panel debate from a contractor and employer perspective on the public works suite of building and engineering contracts.
