Quebec construction companies plead guilty to bid-rigging in Chicoutimi hospital expansion project

Susan Hutton and Robert Mysicka -

On February 17, the Competition Bureau announced that three construction companies—Construction G.T.R.L. (1990) Inc., Acoustique JCG Inc., and Entreprises de Construction OPC Inc.—have pled guilty to charges of bid-rigging in a construction project involving the expansion of the Chicoutimi hospital. The case comes less than half a year after a similar bid-rigging scheme involving ventilation companies in Montreal was uncovered and prosecuted, resulting in the imposition of a substantial fine and a prohibition order.

The companies involved in the Chicoutimi hospital bid-rigging scheme were handed down the following fines by the Quebec Superior Court of Justice:

  • Construction G.T.R.L. was ordered to pay a CDN $ 50,000 fine.
     
  • Acoustique JCG Inc. and Entreprises de Construction: were each ordered to pay a CDN $ 25,000 fine.

In addition to the foregoing, the companies will be subject to a court order for 10 years following the date of conviction.

Bid-rigging, which is defined in section 47 of the Competition Act, prohibits bidders from entering into an agreement not to submit bids or to submit pre-arranged bids when responding to a bid or tender call. The criminal sanction under section 47 applies if the person calling for the bids is not made aware of the agreement at or before the time when the bid or tender is submitted or withdrawn. In this case, the Bureau’s investigation revealed that the parties entered into an agreement that pre-determined the winner of the contracts for the expansion of the emergency room at the Chicoutimi hospital in 2003.

The Commissioner of Competition, Melanie Aitken, commented on the harmful effects of bid-rigging, saying “in this case, the bid-rigging scheme ultimately harmed the Chicoutimi Hospital and Saguenay residents, by preventing the hospital from obtaining a competitive price for its renovation.”

We will continue to monitor civil and criminal enforcement actions under the Competition Act as they arise. For more information on Canada's Competition Act and Investment Canada Act, see our primer here.

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