CRH subsidiary fined €530,000 by Polish authority.

CRH subsidiary fined €530,000 by Polish authority.
Published: 14 May 2007

A subsidiary of building materials group CRH has been fined €530,000 for interfering with evidence that Polish authorities were gathering for a price-fixing investigation.  
 
It emerged yesterday that the Polish Competition and Consumer Protection Office has fined CRH subsidiary Grupa Ozarow €530,000 after one of its workers attempted to tamper with evidence during a raid on the company’s offices last year. It intends to appeal the ruling.  
 
The Irish group’s management, including chief executive Liam O’Mahony, knew of the fine before the CRH annual general meeting (agm) in Dublin this week. However, they did not inform shareholders or make any reference to the fine, even though the Polish price-fixing investigation, which covers the entire cement industry in that country and not just CRH, was raised.  
 
Mr O’Mahony said after the agm that its subsidiary was co-operating fully with the enquiry.  
 
CRH repeated this yesterday. In a statement it said that "the company is advised there are substantive grounds for appeal and it will strongly defend its position".  
 
It also stated it was disappointed with the fine and noted that the Polish authorities said it was not final.  
 
The Polish government suspects companies in the cement industry of establishing a cartel, setting the terms of sale, dividing up the market and exchanging confidential business information.  
 
EU and local competition laws ban all these activities.  
 
The offences carry heavy fines, linked to company turnover, and in some jurisdictions directors face jail if their companies are found to be involved in these practices. However, the fine imposed on the CRH subsidiary relates specifically to an attempt to interfere with the investigation, and does not mean Ozarow or its Irish parent have been convicted of anything.  
 
It is understood that an employee attempted to delete information from a PC during a raid by the Polish authorities on the Ozarow offices.  
 
CRH would not comment on the specific incident.  
 
At this week’s agm one speaker, Séamus Maye, whose own company Framus is taking a competition law case against CRH in this State, raised the Polish investigation, his own action and a case in the US.  
 
In response, chairman Pat Molloy said the group’s companies compete within the law and operate to the highest ethical standards.