The Netherlands: NMa imposes fines on three executives of Dutch construction companies

01 September 2010

Janneke Kohlen

The Dutch Competition Authority (“NMa”) imposed individual fines on three executives of two construction companies located in the Southern part of the Netherlands, the province of Limburg. The fines vary between EUR 10,000 and EUR 250,000. This is in addition to the fines imposed on the companies themselves.  The executives gave instructions regarding certain conduct which constituted a violation of the Dutch Competition Act by their companies. Both companies have deliberately misled clients through “cover pricing.”

Cover pricing occurs when a potential bidder offers a higher price than its competitor solely to let its competitor win the project. Hence, this cover price is not designed to win the contract but is intended to give the appearance of competition and explicitly to remain on the client’s radar. The construction companies in question are Janssen de Jong Infra BV and contracting and road-construction company Aannemings- en Wegenbouwbedrijf Limburg BV. In addition to the individual fines imposed on their executives, the companies themselves have been fined, totaling more than EUR 3 million.