On 2 May 2017, the Belgian Competition Authority (Belgische Mededingingsautoriteit / Autorité belge de la Concurrence) ("BCA") found that ABB, AEG, Siemens, Schneider and Sécheron had engaged in a cartel in the context of public tenders organised by government-owned railway network company Infrabel and imposed fines amounting to a total of EUR 1,779,000.
Infrabel had first concluded a framework agreement with selected firms in order to define the terms and conditions of future public tenders concerning electrical installations and equipment.
The BCA found that, when these tenders were later launched, ABB, AEG, Siemens, Schneider and Sécheron decided together which party should win each bid and submitted quotations with prices determined in such a way that Infrabel would choose the designated winner. These practices started in August 2010 (as regards Sécheron and Siemens) and in February 2011 (as regards ABB, AEG and Schneider) and produced effects until 30 June 2016, i.e., long after the last evidence of collusion of 1 July 2014. The BCA decided that the duration of the infringement should also include the duration of its effects on the market.
Interestingly, the BCA also pointed to the behaviour of some of Infrabel's own employees, who disclosed information that made the market more transparent. This information included: (i) information on Infrabel's current and future projects; (ii) sensitive information on future tenders, Infrabel's budget for future projects and competing bidders' prices; and (iii) Infrabel's preferences for specific suppliers in local geographic areas. The BCA considered that this constituted a mitigating circumstance in favour of the cartelists and therefore granted a reduction in the fines.
ABB was the first firm to blow the whistle on this case and therefore obtained immunity from fines under the leniency programme. Four natural persons also requested – and obtained – immunity from prosecution. Additionally, Siemens and AEG secured respectively 50% and 30% reductions from fines under the BCA's leniency programme. Although not a leniency applicant, Sécheron obtained a decrease of its fine on account of its cooperation during the investigation, pursuant to para. 29 of the Belgian Fining Guidelines.
Schneider was apparently in a peculiar situation: the BCA considered that, "due to the specific circumstances of this case", the immunity application filed by a former Schneider employee had established Schneider's participation in the cartel while making it impossible for Schneider to seek leniency itself. In an apparent effort to compensate this lost chance to seek leniency, the BCA reduced Schneider's fine by an undisclosed amount.
On the other hand, Siemens' fine was increased twice: the first time to sanction Siemens' role as the ringleader of the cartel and the second time in order to increase the deterrent effect of the fine, with the BCA noting that Siemens' worldwide turnover reached EUR 79,6 billion in 2016.
Finally, the fines imposed by the BCA were reduced by 10% as the cartel participants agreed to settle the case.
The BCA imposed a fine of EUR 357,000 on AEG, EUR 19,000 on Sécheron, EUR 432,000 on Schneider and EUR 971,000 on Siemens.
It is worth noting that this decision closely follows the publication by the BCA of a guide raising awareness of bid rigging and helping procurement managers of public bodies identify and to prevent collusive behaviour of potential suppliers (See, VBB on Belgian Business Law, Volume 2017, Issue No.1, p. 8, available at www.vbb.com ). The BCA also made it clear earlier this year that public procurement constitutes one of its enforcement priorities for 2017 (See, VBB on Belgian Business Law, Volume 2017, No. 4, pp. 3-4, available at www.vbb.com ).
Since this decision was adopted by the BCA in the context of a settlement procedure, it cannot be appealed and is thus final.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
