The UK Competition Appeal Tribunal cuts fines in the construction cover pricing appeal case (Kier Group)

‘Cover Pricing’: Object or Effect?* Last week, the UK’s Competition Appeals Tribunal (CAT) cut fines on six construction firms by 90%. The fines had been imposed by the Office of Fair Trading in 2009 for cover pricing. The CAT found the original penalties were excessive and reduced the fines totalling £42 million to just £5 million, reflecting their view that cover pricing is less serious than ‘traditional’ cartel conduct. They accepted the treatment of cover pricing as an ‘object’ agreement, but suggested that effects should be considered in calculating the fine. This raises an interesting question: if cover pricing is different from bid-rigging – and should warrant such a significant reduction in fines – should it really be treated as an object agreement? The decision represents the first of

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  • University of East Anglia (Norwich)

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Andreas Stephan, The UK Competition Appeal Tribunal cuts fines in the construction cover pricing appeal case (Kier Group), 11 March 2011, e-Competitions March 2011, Art. N° 38585

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