On October 27, 2017, Cardinal Ventilation Inc. was fined $375,000.00 after pleading guilty to one count of bid rigging related to three condominium development projects in Montreal. The contracts in question related to the supply and installation of ventilation and/or air conditioning systems in residential high-rise construction projects in the greater Montreal region.
Cardinal Ventilation Inc. admitted that it conspired with competing Montreal-area companies to obtain a ventilation contract by ensuring it offered the lowest bid on the Faubourg St-Laurent Phase II construction project in Montreal. The company also admitted to its participation in two other agreements to ensure that competing firms would get the contracts for two other projects: Le Roc Fleuri and Tour St-Antoine.
The courts have imposed fines totalling over $1 million in this matter.
The Competition Bureau began investigating this matter following a tip from a former employee of one of the accused companies. Over the course of the investigation, Bureau officers searched many sites, seized thousands of documents and interviewed numerous witnesses. The Bureau eventually uncovered evidence indicating that several companies had coordinated their bids in order to pre-determine the winners of the residential construction contracts, while blocking out competitors. The Bureau’s investigation found evidence of bid rigging in five competitive bidding processes between 2003 and 2005, for contracts worth a total of approximately $8 million. In December 2010, the Bureau laid charges against eight companies and five individuals.
There have been several plea agreements in the matter. To date, four companies and two individuals have pleaded guilty for their participation in the bid-rigging scheme. As part of one individual’s plea agreement, he agreed to complete 50 hours of community service and to collaborate with the Bureau’s ongoing involvement in the matter.
In one case, charges against one of the accused individuals were withdrawn in exchange for the individual’s full cooperation with the Bureau’s investigation.
There is one remaining accused in the matter.
The charges laid in this matter are a reminder that cracking down on cartel offences, including bid rigging remains one of the Bureau’s top priorities. Under section 47 of the Competition Act, it is a criminal offence for two or more bidders to enter into an agreement not to submit bids or to submit pre-arranged bids when responding to a bid or a call for tender. Penalties for bid rigging include a fine at the discretion of the court and/or a prison sentence of up to 14 years.
As the big rigging offence continues to be a top priority for the Bureau, it will be interesting to see how similar cases are resolved and whether cooperation among offenders will increase and contribute to more effective, cost-efficient resolutions for Canadians.