On 8th October 2014, the Italian Competition Authority (the “ICA”) opened an in-depth investigation into five companies (the “Accused Companies”) operating in the cleaning services sector for alleged infringements of Article 101 TFEU, the prohibition of anti-competitive agreements.
The ICA alleged anti-competitive conduct during tenders made for providing cleaning services for school premises within Italy.
According to the ICA, the Accused Companies possessed the means to make invitations for all the tenders but they did not do so, effectively not competing amongst themselves. Indeed, the ICA has accused the companies of market sharing by dividing up the tender opportunities between them.
The ICA held that this behaviour could not be the result of true competition and alleged that the Accused Companies had decided to illegally allocate markets by deciding the winner of the relevant tender before making invitations.
Further, the possible anti-competitive coordination was likely reinforced by the corporate links among the Accused Companies which participated in the same consortium.
Through this strategy, the ICA alleges that the Accused Companies sustained far lower costs which they would have borne by competing.
The conduct raises serious potential issues regarding its compatibility with Article 101 TFEU. In fact, any agreement not to compete with competitors would fall within such provision which forbids bid rigging and market allocation.
The ICA has recently increased its focus on public tenders as investigations of such a kind are becoming numerous. If wrongdoing is found, the ICA investigation and subsequent enforcement action could be considered a high profile deterrent against bid rigging and allocating markets. However, the alleged wrongdoing is not proven at this stage and the investigation continues.