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CAT reduces penalty in cover pricing appeal

30/03/11

GF Tomlinson Building Ltd and Others v Office of Fair Trading [2011] CAT 7

On 24 March 2011, the Competition Appeal Tribunal ("the CAT") handed down judgment on an appeal brought by GF Tomlinson Building Ltd and GF Tomlinson Group Ltd (together "Tomlinson") against the OFT's decision on bid rigging in the construction industry dated 21 September 2009 (the "Decision").

In the Decision, the OFT found that Tomlinson had committed three infringements of the Competition Act 1998, all of which involved taking a "cover price" from a rival bidder. None of the infringements involved the making or receiving of compensation payments. In total, the OFT imposed a penalty of £1,269,270 for these three infringements.

Tomlinson appealed to the CAT against the penalty imposed on it.

In its judgment, the CAT found that the OFT had erred in calculating the level of penalty, in particular by using the last business year prior to the Decision for determining relevant turnover rather than using the business year prior to the infringement.

Accordingly, the CAT concluded that the total penalty imposed on Tomlinson should be reduced to £468,000 (a reduction of almost two thirds).

The judgment is here.

Aidan Robertson QC and Sarah Abram appeared on behalf of Tomlinson.

Sarah Ford appeared on behalf of the OFT.

The judgment also covered five other successful appeals against the level of penalty, including those brought by Interclass Plc and Seddon Group Limited, for whom Aidan Robertson QC acted.