by Trevor Sturgess
Kent’s oldest builder has been fined more than £700,000 for colluding with competitors on contracts.
R Durtnell & Sons, based in Brasted, near Westerham, was named by the Office of Fair Trading in a list of 103 construction firms found guilty of the practice and between them fined £129.5m. Durtnell has been ordered to pay £711,115.
The company traces its origins back to the 16th century. Its first house was an oak-framed property called Poundsbridge Manor, near Penshurst, built in 1593 and still in fine condition to this day.
The company was founded in 1591 and has been trading continuously ever since. It has been handed down from father to son for 12 generations.
The decision follows an OFT Statement of Objections in April 2008 after one of its largest Competition Act investigations.
After one of its largest Competition Act investigations, the OFT said it had “concluded that the firms engaged in illegal anti-competitive bid-rigging activities on 199 tenders from 2000 to 2006, mostly in the form of so-called cover pricing."
Cover pricing is where one or more bidders in a tender process obtains an artificially high price from a competitor.
Such cover bids are priced so as not to win the contract but are submitted as genuine bids which give a misleading impression to clients as to the real extent of competition. This distorts the tender process and makes it less likely that other potentially cheaper firms are invited to tender.
In 11 tendering rounds the OFT found nationwide, the lowest bidder faced no genuine competition because all other bids were cover bids, leading to an even greater risk that the client may have unknowingly paid a higher price.
The infringements affected building projects across England worth more than £200m including schools, universities hospitals, and numerous private projects from the construction of apartment blocks to housing refurbishments.
Other named construction firms with extensive Kent interests included the Kier Group, which is involved in the Building Schools for the Future project, and Morgan Ashurst, currently building Canterbury Innovation Centre.
The OFT has urged procuring organisations not to exclude infringing firms from future tenders, saying the practice was “widespread” and “those that have already faced investigation can now be expected to be particularly aware of the competition rules.”
Simon Williams, the OFT director in charge of the probe, said: ‘Our investigation has uncovered significant infringements of competition law on nearly 200 projects across England.
“Bidding processes designed to ensure clients and in many cases taxpayers receive the best possible choice and price were distorted, creating a real risk of increased prices. This decision sends a strong message that anti-competitive and illegal practices, including cover pricing, must cease. “