The Czech Office for the Protection of Competition has handed out fines exceeding CZK 157 million (6,079,725 Euros) to six companies involved in a widespread cartel in the railway construction sector. The decision, issued in the first instance, found that the firms had colluded to rig bids on public contracts related to the repair, modification, and modernization of signaling and safety equipment at railway stations and level crossings.
The companies admitted to their illegal behavior under the Office’s settlement procedure, which earned them a 20 percent reduction in their fines and spared them from being banned from public procurement contracts. However, two firms have appealed the ruling, meaning the decision is not yet final in those cases.
The authority concluded that the firms — ATE, AŽD Praha, EPLcond, MONZAS, První SaZ Plzeň, and STARMON — engaged in unlawful bid-rigging agreements, some of which also involved elements of price-fixing and market-sharing. In practice, the collusion often took the form of so-called cover bidding, where one company submitted a deliberately less competitive offer to help another win the contract, thereby avoiding cancellation of the tender. These agreements distorted competition in 26 public contracts between 2015 and 2021, collectively worth more than CZK 850 million (EUR 34,451,775). The contracts were awarded by the State Railway Administration.
The case began after the Supreme Audit Office flagged suspicious practices in three public tenders. The competition authority followed up with its own investigation, including dawn raids at company premises, which ultimately uncovered a broader network of coordination affecting more contracts.
One company cooperated with the Office under the leniency program and received a significant fine reduction for its assistance and disclosure. In addition, two firms saw their fines reduced due to the implementation of compliance programs and their cooperation with the authority under existing soft law guidelines.
This case is part of a broader effort by the Czech competition watchdog to clean up corruption and cartel practices in public procurement. It is not the first time the authority has intervened in the railway crossing security sector — two previous related cases resulted in fines totaling over CZK 46 million (EUR 1,864,449).
The fines in the current case range from just over CZK 5 million (EUR 202,657) to more than CZK 52 million (EUR 2,107,638) per company, depending on the extent of their involvement and level of cooperation.
