The Competition Council (KP) has fined three companies for possible participation in a road construction cartel – AS A.C.B, AS Ceļu pārvalde, and SIA Strabag, the chairman of the KP said at a press conference on Wednesday, the 14th of June.
In the case of the road construction cartel, KP has imposed a fine of EUR 4,451,649.77 on companies.
KP, based on the information provided by the Corruption Prevention and Combating Bureau (KNAB) and the additional evidence obtained during the investigation, found a violation of the prohibitions stipulated in the Competition Law and the Treaty on the Functioning of the European Union in the activities of road construction companies.
KP has found prohibited agreements in public procurements for the construction of roads and highways
in Latvia, organized by Latvian State Roads.
A.C.B was fined 2,920,157.18 euros, the Ceļu Pārvalde – 1,026,958.61 euros, and Strabag – 4,533.98 euros.
In addition to that, the KP reached a settlement with A.C.B and Strabag on the termination of the legal dispute in the case, the companies agreeing to the established facts and undertaking not to appeal the final decision of the KP.
The settlement provides for a 10% reduction in the fine.
KP draws attention to the fact that the total market share of the participants in the road and highway construction market in the period from 2016 to 2018 was about one-third, which is a significant amount.
KP identified seven procurements for which the prohibited agreement took place, with a total contract amount of 24,762,272.11 euros.
Four procurements were related to the reconstruction, rebuilding, or resurfacing of the country’s main highways, two procurements were related to the reconstruction or resurfacing of regional highways, and one procurement was related to the resurfacing of a local highway.
The procurements included road construction works near Rīga, Cēsis, Ogre, Tukums, Jaunjelgava, and other places.
The contract sum of the smallest project was slightly over one million euros, and the largest – over eight million euros. In addition, 43% of all projects were related to co-financing from European Union funds.
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