Competition law compliance: OFT investigates construction training services sector

Competition law compliance: OFT investigates construction training services sector

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Author: Jaime Moore

The Office of Fair Trading (OFT) has launched an investigation into suspected anti-competitive conduct concerning provision of training services to the construction industry.

The investigation relates to allegations that certain businesses have entered into anti-competitive agreements.

Details are scant and the businesses under investigation have not been named, but the OFT announcement suggests that its concerns focus on the activities of a trade association.

This is the latest in a number of OFT investigations involving the construction sector.

The OFT's construction cartel investigation, completed in 2009, was one of the biggest cases run by a competition authority anywhere in the world, leading to infringement findings against approximately 100 parties concerning nearly 200 projects.

And in 2006, it imposed significant fines on six construction industry recruitment agencies for price-fixing and the collective boycott of a rival.

This latest investigation is likely to affect providers of training services to the construction industry directly, as well as customers of those services (who may well, for example, be able to bring damages claims should it be proved that they have been overcharged).

The case also serves as a warning shot for trade associations. While they perform many valuable (and entirely legitimate) activities, they must be alert to the inherent competition risks.

Activities that potentially restrict competition between their members are likely to be 'off-limits', or at the very least should be subject to prior legal sign-off. Many such organisations have in place competition law compliance programmes to guide staff and members on key do's and don'ts.

The OFT's current investigation is at a very early stage and the allegations have yet to be proved. Between now and around June 2013, the OFT will gather information from the parties under investigation and from third parties, including through formal or informal information requests, and analysis and review of parties' responses.