The National Commission of Markets and Competition (CNMC) has imposed fines totaling 6.3 million euros on 22 consulting services companies, including some of the main firms operating in Spain, and one dozen of its directors for an infringement of article 1 of the Law on the Defense of Competition (LDC) and 101 of the Treaty on the Functioning of the European Union (TFEU), constituting a cartel.
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Specifically, the body chaired by Cani Fernández has fined the companies with 5.87 million euros and several executives of the consulting firms with a total of 439,000 euros, for being involved in the cartels, and has activated the legal budget so that some of these companies cannot participate in future contests organized by public administrations (AAPP).
Deloitte is the company that receives the largest fine, with 3.99 million euros, followed by PwC, with 670,000 euros, and Idom Consulting, with 640,000 euros. Also on the list of fined KPMG 50,000 euros and firms such as Altia Consultores (30,000 euros), Bmasi Strategy (153,529 euros), Competitiveness, Development and Innovation (14,823 euros), Gestiona XXI Consulting (3,218 euros), Indra Business Consulting ( € 27,000), Red2Red Consultores (€ 30,000), Uliker-3 (€ 11,040), 97S & F (€ 131,593), Abay Economic Analysts (€ 12,499), Factor Ideas Integral Services (€ 20,000), Gaps Politica i Societat (€ 15,000) , Hidria, Ciencia, Ambiente y Desarrollo (11,979 euros), Red2Red Consultores (25,000 euros) and Regio Plus Consulting (33,744 euros).
In the case of Indra, the CNMC has applied a reduction of the fine of 10% as a result of the actions taken within the framework of its regulatory compliance programs, while in the case of PA Consulting Services Limited Sucursal en España and one of their managers, a 40% reduction in the amount of the fine has been applied due to their request for clemency. The CNMC declares that the participation of the companies Oesía Networks and its parent company Heisenberg 2014 in the infringement declared in this file is not credited.
The file originates from a preliminary investigation carried out by the Basque Competition Authority (AVC) which, after carrying out a series of inspections, decided to refer the matter to the CNMC, as the events were overcome by the Basque Country.
Consequently, in October 2018, the CNMC carried out various inspections at the headquarters of various consulting firms regarding possible agreements for the distribution of contracts and exchanges of information.
In February 2019, the CNMC initiated a sanctioning proceeding against 25 of these companies and eight of their executives which, in August 2019, expanded to 11 new companies and two of those responsible, for their possible participation in the manipulation and distribution of public tenders.
During the investigation of the case, the CNMC has proven that, between 2008 and 2018, the firms were organized into two collaboration networks (north and national) and that, through these, they constituted two different cartels.
The companies exchanged sensitive commercial information and used common strategies to avoid competing when participating in tenders to offer consulting services requested by different public administrations.
In total, the CNMC has analyzed 200 public contracts signed in the years in which the conduct is proven.
In the case of the cartel of the northern collaboration network, at least 101 tenders from, among others, the Bilbao city councils were affected; Santander; Sestao; Barakaldo or Vitoria; various Departments of the Basque Government and the Government of Cantabria; the Junta de Castilla y León; the Port of Bilbao or the Provincial Council of Vizcaya.
For its part, in the cartel of the national network, the manipulation affected 72 tenders called, among others, by the Ministry of Finance; the Ministry of Labor and Immigration; the Ministry of Economy; the Community of Madrid; the Generalitat Valenciana; the Diputaciones de Cádiz and Sevilla; the Juntas of Extremadura and Andalusia; the Generalitat of Catalonia; the Government of the Canary Islands or the Government of the Balearic Islands.
The personal and professional trust relationships of some of the managers (sometimes former co-workers) facilitated the functioning of these networks.
Among them, mutual assistance and collaboration were requested to manipulate the public contracts launched by the different administrations affected. It was enough to send an email by one of the companies in the network, which was accepted without further explanation by the recipients.
Generally, these were contracts negotiated without advertising, in which the administration invited a small number of companies to present their offers in competition. Both cartels took advantage of this procedure to use what are known as “hedging offers”.
Through the “coverage offers” one of the consulting firms invited to participate in the contest regularly contacted other companies in its collaboration network, which it knew would also participate; it asked them to submit a losing offer or simply to decline the invitation to participate in the process.
Sometimes, even the consulting firm that requested the coverage prepared the offers of its supposed competitors or prepared the letter of resignation to the invitation.
Through this system, the prices paid by the administration for consulting services were continuously raised, the incentive to improve the quality of services was limited, and the participation of non-cartel competitors in the bidding processes was prevented. These behaviors had a full impact on the public purse, as they were contracts that are paid for via budgets.
The CNMC forwards this resolution to the State Public Procurement Advisory Board for the appropriate purposes and recalls that there is no appeal against this resolution through administrative channels, and a contentious-administrative appeal may be filed in the National High Court, within a period of two months. counting from the day following its notification.