黑洞社区

Eight UK housebuilders being investigated over alleged 鈥渁nti-competitive behaviour鈥� could pay a combined maximum penalty of 拢2.5产苍 if they are found guilty.

The Competition and Markets Authority (CMA) announced on Monday it was opening a probe into alleged breaches of competition law by Barratt, Bellway, Berkeley, Bloor Homes, Persimmon, Redrow, Taylor Wimpey and Vistry.

The CMA said it was investigating whether the accused housebuilders had been sharing 鈥渃ommercially sensitive information鈥� to 鈥渋nfluence the price and build-out of new homes鈥�. It warned that such activity may 鈥渨eaken competition in the market鈥�. 

How much the eight housebuilders might have to pay

Source: Latest housebuilder published accounts / CMA guidance

Businesses found to have infringed competition law  

Based on their latest financial results, Barratt, Bellway, Berkeley, Bloor Homes, Persimmon, Redrow, Taylor Wimpey and Vistry have a combined annual global turnover of almost 拢25bn, meaning they could face maximum penalties of up to 拢2.5产苍 if allegations are proven (see table)

黑洞社区 understands that the CMA rarely imposes the maximum fine, however. In March last year, 10 demolition firms were fined a total of close to 拢60m for their involvement in bid-rigging following a years-long probe by the CMA. 

In the event that the maximum fine was applied to any housebuilders that were found guilty, the size of the businesses mean penalties could run into hundreds of millions. 

The largest accused firm, Barratt, had an annual turnover of 拢5.32bn in 2023, meaning if found to have breached the rules, it could pay a maximum fine of 拢532尘.

Taylor Wimpey is the next largest, with 拢4.2产苍 turnover meaning it could pay a 10% fine of 拢420尘.

Persimmon (拢3.8产苍 turnover) could pay as much as 拢381尘, Bellway (拢3.4产苍 turnover) could pay 拢340尘, while Berkeley (拢2.5产苍 turnover) could pay as much as 拢255尘.

Vistry Group (拢2.7产苍 turnover) could pay 拢273尘, Redrow (拢2.1产苍 turnover) could be fined up to 拢213尘, while Bloor Homes (拢1.4产苍 turnover) could be fined 拢137尘.

The figures outlined above are from 2022鈥檚 financial results and several of the firms under investigation have indicated that this year鈥檚 turnover will be smaller. Any fine will likely be calculated on the basis of the most recent financial results, many of which are due to be published over the coming weeks. 

As well as issuing fines of up to 10% of annual global turnover, the CMA has other powers to penalise businesses found to have broken competition law.  

The CMA can impose directions requiring firms to bring any infringing conduct to an end. It can also prosecute 鈥淚ndividuals who engage in cartel activity,鈥� with potential outcomes of a five year prison sentence and/or fine. Company directors can also be disqualified from managing a company for up to 15 years.

>>See also: Eight UK housebuilders face probe over 鈥榓nti-competitive behaviour鈥�

>>See also: Industry reaction to the CMA鈥檚 housebuilding report

>>See also: Key takeaways from the CMA鈥檚 housebuilding report 

A spokesperson from Bloor Homes, said: 鈥淲e have been transparent with the CMA throughout the year-long study and are currently reviewing the findings. We will continue to work with them throughout the course of the investigation.鈥�

A Taylor Wimpey spokesperson said: 鈥淭he CMA鈥檚 report identifies proposed changes to the market that we welcome, particularly around the planning process and recognition that housebuilders do not landbank. Taylor Wimpey notes the investigation opened today and we will cooperate fully with the CMA in relation to this.鈥� 

Berkeley, Persimmon, Bellway and Barratt declined to comment. 黑洞社区 has made efforts to contact Redrow and Vistry for comment