Mastic asphalt flat-roofing contracts in Scotland

No. CA98/01/2005

8 April 2005

The Office of Fair Trading has concluded that four roofing contractors (the Parties) colluded in relation to the making of tender bids in mastic asphalt flat roofing contracts in Scotland thereby infringing the Chapter I prohibition contained in section 2(1) of the Competition Act 1998.

The Parties were involved in individual agreements and/or concerted practices each of which had as its object the fixing of prices in the market for the supply of installation, repair, maintenance and improvement services for mastic asphalt coverings for flat roofs in Scotland. When a purchaser wished to purchase such services for a flat roof, it typically invited a number of suitably qualified contractors to submit tender bids detailing the price at which they could undertake the work specified in order to have competition for the individual contract between contractors and obtain a competitive price. The Parties' co-operation and co-ordination with each other in relation to the setting of tender prices had the object of preventing, restricting or distorting this competition. Different parties were involved in different numbers of contracts and the OFT has considered the collusion in relation to the tenders for each individual contract as discrete infringements.

The OFT considers that agreements and/or concerted practices between undertakings that fix prices by way of collusive tendering (or otherwise) are among the most serious infringements of the Act. Financial penalties have therefore been imposed on all Parties, subject to the operation of the policy to give lenient treatment for undertakings coming forward with information in cartel cases. In line with this policy Briggs Roofing & Cladding Limited has been granted 100 per cent leniency.  In addition, Pirie Limited has been granted a reduction in fine by 55 per cent (which, in addition to a reduction in fine granted to it for its co-operation with this investigation, includes a further uplift in recognition of the fact that Pirie was the first party to apply for leniency and voluntarily provide information in relation to a separate product market under the OFT's 'leniency plus' policy), W G Walker & Company (Ayr) Limited by 45 per cent, and Lenaghen Roofing Services by 35 per cent.

The list below sets out the penalty for each Party, with figures in brackets indicating penalty after leniency.

Briggs - £57,120 (£nil)
Pirie - £114,873 (£51,693)
Walker - £29,845 (£16,415)
Lenaghen - £29,607 (£19,245)

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