Dozens of firms successfully appealed against OFT claims

锘緿ozens of construction companies that have succeeded in having fines imposed by the OFT reduced by up to 94% could find out on 1 May whether the OFT is likely to mount an appeal of its own.

The OFT must decide by 1 May whether it wants to appeal a Competition Appeal Tribunal (CAT) decision to reduce the fines it levied on six construction recruitment agencies accused of price fixing. This could see it declare its hand on how it will proceed with the construction companies.

However, the OFT has until the last of the three remaining judgments are handed down to AH Willis and Sons, GMI Construction and North Midland Construction to consider its course of action. No date has been set for the outcome of these three appeals, meaning that construction companies eager to put the cover pricing issue behind them are faced with ongoing uncertainty.

鈥淭he OFT is being very tight-lipped on how it is likely to proceed on the construction companies,鈥 said Pinsent Masons partner Alan Davis, who managed to secure an 83% fine reduction for his client Galliford Try in its appeal of the OFT fine. 鈥淏ut on the recruitment agencies it has until 1 May. This will be an indication of the line it is likely to take on other appeals - they will have to show their hand.鈥

A total of 25 appeals were made to the CAT after the OFT imposed fines of 拢129m on 103 companies for bid-rigging. In the 22 judgments handed down so far, the total amount of penalties levied has been cut from 拢76m to 拢13m. The largest percentage reductions were awarded to Ballast Nedam and John Sisk, whose penalties were cut by 94%.

In these and other judgments, the CAT judges found that the OFT acted in a 鈥渄isproportionate鈥 and 鈥渆xcessive鈥 manner when calculating fines and that it erred when working out the baseline for the fines.

Six appeals contested liability as well as the penalties but only one of these - Durkan - was partially successful on this point.

But Davis did not think that any conclusions could be drawn from this on how the CAT is likely to rule in the remaining three appeals - all of which involve the companies contesting liability.

鈥淚t鈥檚 very fact specific,鈥 he said. 鈥淵ou can see that the tribunal has looked at the specifics of each case, which is what the appellants wanted them to do.鈥

A spokesperson for the OFT gave little away about its future tactics, but pointed out that on 15 April the CAT upheld the OFT鈥檚 decision that Crest Nicholson/ISG Pearce and Quarmby Construction/St James Securities Holdings were still liable.

鈥淲e will consider these judgments in detail, alongside those in all other construction appeals, and will then decide whether to appeal.

 鈥淭wo of [15 April鈥檚] judgments involved appeals over the companies鈥 liability for the infringements as well as the level of their penalty, and in each case the OFT鈥檚 decisions on liability were upheld,鈥 the spokesperson said.

锘縊FT fines and CAT reductions

锘1. Kier 拢17,894,438 reduced to 拢1,700,000 (-90%)
2. Ballast Nedam 拢8,333,116 reduced to 拢534,375 (-94%)
3. Bowmer and Kirkland 拢7,574,736 reduced to 拢1,524,000 (-80%)
4. Corringway Conclusions 拢769,592 reduced to 拢119,344 (-85%)
5. Thomas Vale 拢1,020,473 reduced to 拢171,000 (-83%)
6. John Sisk and Sicon 拢6,191,627 reduced to 拢356,250 (-94%)
7. Durkan and Concentra 拢6,720,551 reduced to 拢2,436,000 (-64%)*
8. Apollo 拢2,150,536, reduced to 拢399,000 (-81.4%)
9. Galliford Try 拢8,333,329, reduced to 拢1,395,000 (-83.3%)
10. GF Tomlinson 拢1,269,270, reduced to 拢579,000 (-54.4%)
11. G&J Seddon 拢1,516,646, reduced to 拢492,000 (-67.6%)
12. Interclass 拢464,406, reduced to 拢324,000 (-30.2%)
13. Sol Construction 拢1,835,702, reduced to 拢744,000 (-59.5%)
14. Francis Construction and Barrett Estate Services 拢530,238 reduced to 拢169,575 (-68%)
15. GAJ 拢109,683 reduced to 拢42,750 (-61%)
16. Allenbuild and Renew 拢3,547,931 reduced to 拢926,250 (-74%)
17. Robert Woodhead 拢411,595 reduced to 拢151,725. (-63%)
18. J H Hallam 拢359,588 reduced to 拢99,000. (-72%)
19. Hobson & Porter 拢547,507 reduced to 拢123,750. (-77%)
20. Quarmby and St James Securities Holdings 拢881,749 reduced to 拢213,750. (-76%)
21. Crest Nicholson 拢5,188,846 reduced to 拢950,000 (-82%).
22. ISG Pearce 拢5,188,846 reduced to 拢950,000 (-82%)

Total fined by OFT so far: 拢75,651,559 Reduced to: 拢12,595,769
*Not deemed liable for all areas originally alleged by the OFT

锘縅udgments to come

  • 锘緼H Willis and Sons
  • GMI Construction
  • North Midland Construction