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OFT to pay £1.5m cost of contractor appeals

The Office of Fair Trading will pay over £1.5 million in legal costs to 11 contractors that succesfully appealed against the size of fines handed down in the cover pricing scandal.

In a ruling handed down on Friday, the Competition Appeals Tribunal said the watchdog must now cover a large portion of the legal costs incurred by nine firms who succesfully appealed against the size of fines handed down in 2009.

The 11 contractors – Kier, Ballast, Bowmer, Corringway, Thomas Vale, Sisk, Seddon, Interclass, Tomlinson, Apollo and Galliford Try – had claimed over £2.6m between them.

But the CAT set a cap of £200,000 on the amount that could be awarded to each contractor.

The amounts awarded in each case were

  • Kier: £200,000 (claimed £427,113)
  • Ballast: £200,000 (claimed £290,299.86)
  • Bowmer: £150,000 (claimed £290,299.86)
  • Corringway: £170,000 (claimed £249,190)
  • Thomas Vale: £142,129.24 (claimed £142,129.24)
  • Sisk: £170,000 (claimed £559,014.22)
  • Seddon £45,642.35 (claimed £53,696.88)
  • Interclass £31,374.96 (claimed £39,218.70)
  • Tomlinson £79,872.80 (claimed £93,968)
  • Galliford Try £160,000 (claimed £364,810.73)
  • Apollo £168,402.81 (claimed £168,402.81)

The awards were made on the basis the contractors could be identified as “winners” in their appeals.

But Quarmby Construction and St James Securities, saw its claim rejected as it could not necessarily be identified as a winner in their appeals.

Judges also noted the “disparity in the amounts claimed is certainly striking”.

The CAT cut the fines imposed by the OFT earlier this year after finding it had wrongly calculated the size of fines and exaggerated the seriousness of offences.

The appeals come as the latest development in the ongoing saga of the OFT’s investigation into bid rigging.

The OFT orignally imposed fines of £130m on 103 companies after finding them guilty of various offences.

Most were accused of submitting fake tenders for jobs to maintain client relationships - a practice known as cover-pricing.

The fines for 25 companies that appealed were cut from £76m to £13m by the Competition Appeals Tribunal.

The majority of the remaining 13 companies that sucessfully appealed the judgements are expected to be recieve similar awards soon.

At least one firm is understood to have rejected the chance to claim back its costs.

 

 

 

 

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