Galvanised steel tanks are used for water storage in larger buildings, such as schools, hospitals and other commercial and public buildings, and supply the water used in fire sprinkler systems.
Previously, in a settlement announced in March 2016, 3 of the 5 suppliers – Franklin Hodge Industries Ltd, Galglass Ltd and KW Supplies Ltd (as economic successor to Kondea Water Supplies Ltd) – admitted to having agreed with each other, and with a fourth supplier, CST Industries (UK) Ltd, to share the market between them, to fix prices and to rig bids for contracts between 2005 and 2012. The aim of these actions was to improve profit margins on the tanks by avoiding customers being able to ‘play’ the competitors off against each other. These companies have agreed to pay fines totalling more than £2.6 million.
CST Industries (UK) Ltd, which brought these arrangements to the authorities’ attention, will, as a result, benefit from immunity from fines under the Competition and Markets Authority’s (CMA) leniency policy, provided that it continues to co-operate and complies with the other conditions of the CMA’s leniency policy.
In a separate allegation, the CMA has also provisionally concluded that some of the suppliers exchanged competitively-sensitive pricing information at (or shortly after) a meeting in July 2012. This concerned 3 of the suppliers involved in the main cartel arrangement who admitted this conduct as part of the settlement announced in March (Franklin Hodge Industries Ltd, Galglass Ltd and KW Supplies Ltd), plus another supplier, Balmoral Tanks Ltd.
Stephen Blake, Senior Director of the CMA’s Cartels and Criminal Group, said:
“Strong competition between businesses has clear benefits for customers, who benefit from lower prices, better quality and more choice. Any weakening of competition that maintains or increases prices will ultimately be at the expense of consumers or tax payers.”
“In March, we announced a settlement with the participants in the main cartel and the issue of today’s statement represents the next stage in the process.”
“The information exchange allegation against the non-settling party, Balmoral, will be considered by a new case decision group, which will hear any representations Balmoral may wish to make. No conclusion should be drawn that Balmoral has infringed competition law pending the outcome of that process.”
“Any company that is approached to join a cartel or other anti-competitive conduct or arrangement should immediately and unequivocally reject the approach and avoid participation in any discussions that may involve the sharing of confidential and competitively sensitive pricing information.”
The CMA has produced a range of guidance to help businesses understand more about competition law including an at-a-glance guide and a series of animated videos that explain what anti-competitive behavior looks like.