Felt and single ply roofing contracts in Western-Central Scotland: anti-competitive practices

Office of Fair Trading (OFT) closed Competition Act 1998 case.

Case reference: CA98/04/2005

Summary of work

Since this decision was published, there has been an amendment to the name of one of the parties to Advanced Roofing Systems Limited.

The Office of Fair Trading has concluded that six roofing contractors, as listed below (the Parties), colluded in relation to the making of tender bids for felt and single ply roofing contracts in Western-Central 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 felt and single ply coverings for flat roofs in Western-Central 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 are therefore being imposed on all the 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 Pirie Limited has been granted full immunity from penalty (in recognition of the fact that Pirie was the first party to apply for leniency and voluntarily provide information in connection with the OFT's pre-existing investigation in this case), and W G Walker & Company (Ayr) Limited by 45 per cent. None of the other parties have applied for leniency.

The list below sets out the party penalty calculated at the end of Step 5, with figures in brackets indicating the penalty to be paid.

Pirie - £85,774 (£0)
Walker - £76,194 (£41,907)
Advanced Roofing Systems Limited - £1,963 (£1,963)
Brolly - £22,239 (£22,239)
Bonnington - £45,187 (£45,187)
McKay - £27,219 (£27,219)

Total - £258,576 (£138,515)

Published 12 July 2007