The U.S. Department of Justice announced that an Iowa ready-mix concrete company has plead guilty to participating in price-fixing and bid-rigging conspiracies in relation to the sale of ready-mix concrete (see: Iowa Ready-mix Concrete Company Pleads Guilty to Participating in Price-fixing and Bid-rigging Conspiracies).
In making the announcement, the U.S. DoJ stated:
“According to a three-count felony charge filed on May 18, 2011, in U.S. District Court in Sioux City, Iowa, GCC Alliance Concrete Inc., a producer of ready-mix concrete headquartered in Orange City, Iowa, participated in separate conspiracies with three different companies involving agreements to fix prices and/or to rig bids for ready-mix concrete sold to various companies in the northern district of Iowa and elsewhere. The department said that the conspiracies took place during various time periods starting as early as January 2006 to as late as August 2009. Under the terms of the plea agreement, GCC Alliance Concrete has agreed to pay a criminal fine, as determined by the court.
Ready-mix concrete is a product comprised of cement, aggregate (sand and gravel), water and other additives. The concrete generally is produced in a concrete plant and is transported by concrete-mixer trucks to work sites, where it is used in various types of construction projects, including buildings and roads.
According to court documents, GCC Alliance Concrete participated in conspiracies through its former sales manager, Steven VandeBrake, in which he engaged in discussions concerning project bids for sales of ready-mix concrete, submitted rigged bids at collusive and noncompetitive prices to customers in Iowa and elsewhere and accepted payment for sales of ready-mix concrete at predetermined prices. VandeBrake also engaged in discussions and reached agreements regarding the prices on the conspirators’ annual price lists for ready-mix concrete sold in Iowa on behalf of GCC Alliance Concrete, the department said.”
Like the United States, in Canada conspiracies (agreements between actual or potential competitors to fix prices, divide markets or restrict output) and bid-rigging (including agreements not to bid or submit bids based on agreement) are criminal offences subject to potential significant penalties including imprisonment for up to 14 years, fines up to $25 million, or both (per count).
Also like other major jurisdictions, many criminal conspiracies have been formed in Canada historically in industries in which it is difficult to compete other than on price – for example, cement, steel and other homogenous products (e.g., chemical inputs).
Unlike the U.S., however, of which this case is a sober reminder, it is relatively rare for Canadian accused to be sentenced to imprisonment, although this has been gradually been changing, particularly in relation to contraventions of the deceptive marketing provisions of the Competition Act (i.e., in relation to fraudulent marketing activities).
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