The Office of Fair Trading (OFT) has accused over 100 construction firms of "bid-rigging" in one of its largest ever investigations.

Construction giants Balfour Beatty, Carillion, Connaught, Interserve and Kier are among the 112 firms alleged to have taken part in a cartel to fix prices when bidding for business.

Approximately 40 companies had already admitted price-fixing in the inquiry, which began after an initial complaint in the East Midlands.

According to the OFT, another 37 firms have applied for leniency.

Balfour Beatty said in a statement: "The company and its operating businesses have co-operated fully with the OFT in all aspects of its investigation. As a result and subject to ongoing co-operation, the OFT has granted leniency to Balfour Beatty, thus reducing any fines which might ultimately be levied on Balfour Beatty or any of its operating businesses.

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The inquiry spans 240 alleged cases where firms have colluded to inflate prices during a tender process, covering both the private and public sector."

The OFT has also received evidence of cover pricing implicating many more companies on thousands of tender processes, but has focused its investigation on approximately 240 alleged infringements which are being pursued in the Statement of Objections (SO).

No assumption should be made at this stage that there has been an infringement of competition law by any of the companies named in the SO.

The 112 parties concerned now have the opportunity to make written and oral representations which the OFT will take into account before making a final decision as to whether competition law has been infringed.

John Fingleton, OFT Chief Executive, said: "Cartel activity of the type alleged today harms the economy by distorting competition and keeping prices artificially high.

"This investigation, together with the OFT's previous decisions in the roofing sector, will hopefully send out a strong message to the construction industry about the seriousness with which we view suspected anti-competitive behaviour. Businesses have no excuses for not knowing and abiding by the law."

(CD/JM)