Polish regulator fines CRH €26m

POLAND’S competition regulator – the Office for Competition and Consumer Protection (OCCP) – has imposed record multi-million euro fines on the Polish units of CRH Plc for alleged price fixing and other anti-competitive behaviour.

It has also been accused of carving up the cement market with some of the other key players to gain competitive advantage.

Others hit with record fines include Cemex SAB and four other cement producers, fined for their anti-competitive behaviour by the Polish authorities.

The top three players which includes the Irish group in third place account for 60% of the market with four others making up the bulk of the rest.

The Irish group has been fined almost €26 million out of the total of €98m imposed for the alleged breaches.

Other companies include part of Germany’s biggest cement maker, Gorazdze Cement SA; HeidelbergCement and a number of Polish producers including Cementowania Odra SA.

At the start of the probe in 2006 the investigators said they suspected some market participants of price fixing and of manipulating sales.

According to the Polish authorities five of the six producers were fined the maximum possible which is 10% of their annual revenues.

CRH generated sales €250m in the Polish cement market this year.

The group has expressed its unhappiness with the findings and is “highly likely” to contest the fines in the Polish courts.

Over the period the market in Poland was volatile as prices fluctuated in the uncertain market conditions and which meant the Polish market has been competitive over the period that was under investigation.

This is the highest penalty imposed by the regulator was 75m zloty (€18.19m) imposed on Poland’s leading telephone group, Telekomunikacja Polska SA, according to Bloomberg.

CRH said in a formal response to the fine: “The conclusions of the OCCP are a matter of serious concern for CRH”.

It added that it believed its subsidiary Grupa Ozarów behaved in an independent fashion in that market at all times and had never been anti-competitive in its business.

That had “been verified by analysis undertaken, at the request of CRH, by leading Polish economic experts”, it said.

“Following a preliminary review of the OCCP conclusions, CRH and Grupa Ozarów have been advised that there are significant grounds for appeal,” the statement said.

Shares in the group were up more than 3% in trading yesterday and stood at €18.86 a gain of 56 cents.

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