Collusion companies may lose out on state tenders

Construction Collusion companies may lose out on state tenders

The Construction Industry Development Board (CIDB) will investigate whether companies which admitted to bid rigging and collusion should be disqualified from state tenders.

The CIDB had appointed a team to investigate the companies, after which it could decide to impose fines, deregister or disqualify companies from tenders, the Cape Times reported today.

The board could fine a company up to R100 000 and bar it from public sector construction work tenders for up to 10 years.

“The [Competition] Commission has found them guilty of collusion. We will be investigating collusion in terms of the code of conduct,” acting board chief executive Hlengiwe Khumalo was quoted as saying.

On June 24, the Competition Commission reached a settlement with 15 construction firms, including Murray & Roberts, for collusive tendering in contravention of the Competition Act.

Seven major construction and engineering firms met secretly in 2006 to allocate tenders on World Cup stadium projects, and to agree on a 17.5% profit margin.

Several companies, including Group Five, Murray & Roberts, Stefanutti Stocks and Aveng also set up a group called the Western Cape Building Market to share out contracts for three major construction projects in the province.

Read more on the construction cartel here.

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