Austrian Construction Group Strabag Fined Millions in Germany for Cartel Agreements

As the German Federal Cartel Office announced, employees of STRABAG AG are said to have agreed on a protective bid together with the construction company Kemna Bau Andreae, which is based in Pinneberg near Hamburg. These agreements were intended to ensure that a bidding consortium including STRABAG would be awarded the contract for the renovation work. According to the Cartel Office, Kemna Bau submitted a so-called protective bid that favored the award of the project to STRABAG. In return, the northern German construction company received compensation payments for the protective bid, a practice also known in the industry as a “stand-off payment”.

Infringement of competition

Cartel Office President Andreas Mundt explained that this type of conspiracy significantly impairs the competitiveness of tenders, as reported by the Kleine Zeitung newspaper. “Submission agreements undermine fair competition and result in excessive costs for contracting authorities,” said Mundt. Such distortions of competition hurt the quality and efficiency of public construction projects, as they eliminate price competition. Such agreements have no place in public tenders, as they are at the expense of the public sector and therefore ultimately the taxpayer.

Anonymous tip-off as the trigger

The investigations against STRABAG were triggered by an anonymous tip-off received by the Federal Cartel Office, as reported by the Kleine Zeitung newspaper. The Bonn authority then began investigating the award procedure for the renovation of the Zoo Bridge. In the course of the investigation, Kemna Bau cooperated extensively with the authorities and secured leniency. This enabled the company to avoid a fine of its own. STRABAG also cooperated and accepted the fine of 2.79 million euros, which has since become legally binding.

Zoo Bridge is an important traffic artery in Cologne

The Zoo Bridge in Cologne plays a central role in Cologne's urban traffic. It connects the right bank of the Rhine with Cologne city center and is crossed by tens of thousands of vehicles every day. The structure has been undergoing refurbishment for years as it has structural defects and needs to be adapted to the traffic loads. This renovation work repeatedly requires temporary closures and leads to traffic obstructions. For example, the Zoobrücke was last partially closed in October 2024 to carry out structural tests as part of the extensive renovation work.

STRABAG under fire: repeated violations

STRABAG SE is no stranger to cartel allegations. The construction group has already been targeted by competition authorities several times in the past. A decision by the Austrian Cartel Court in October 2021, which imposed a fine of 45.37 million euros on two STRABAG Group companies, was particularly sensational. The case concerned price agreements and market sharing in the building construction and civil engineering sectors in Austria that violated antitrust law and took place between 2002 and 2017. In June 2023, the Austrian Supreme Court decided to reopen the proceedings after the Federal Competition Authority questioned STRABAG's leniency status.

Against the backdrop of repeated antitrust violations, STRABAG SE is under increasing pressure to implement strict measures to comply with competition laws. In recent years, the Group has emphasized that it is continuously improving its compliance measures and will not tolerate violations of competition law. Nevertheless, current developments show that the construction industry is still susceptible to distortions of competition. Strict monitoring mechanisms and internal controls are therefore essential to prevent such practices in the future and ensure fair competition.

STRABAG