The National Commission on Markets and Competition (CNMC) has sanctioned seven food distributors: Plataforma Femar, SL (Femar), Acacio, SL (Acacio), Serviline Foods, SL (Serviline), Asesores Llangon, SL (Llangon), Leonesa de Patatas, S. L, Hermanos Vidal, SL (Hnos. Vidal) and Frutícolas Ateca, SL (Ateca) for participating in three cartels that for years shared public contracts to supply food to hospitals (some of them military), nursing homes, penitentiary centres and Army facilities.
The contracting bodies of the Madrid Social Assistance Agency (AMAS) and the General Directorate of Innovation and Agri-Food Promotion of the Government of Aragon informed the CNMC and the Competition Defence Service of Aragon of possible indications of collusion in several tenders.
The CNMC launched an investigation and carried out inspections at the headquarters of several food distributors in March and September 2022. In December of that year, it initiated a sanctioning procedure against several companies, which it extended in July 2023.
Three cartels dismantled
The first cartel, formed by Plataforma Femar, SL (Femar), its subsidiary Acacio, SL (Acacio), Serviline Foods, SL (Serviline) and Asesores Llangon, SL (Llangon), shared the tenders to supply food to groups dependent on public and private organisations from November 2015 to August 2021.
The second cartel, formed by Femar and Leonesa de Patatas, SL (Leonesa), affected the state entity Trabajo Penitenciario y Formación para el Empleo (TPFE). Specifically, it affected contracts for several penitentiary centres from January to March 2022.
The third cartel, formed by Femar, Hermanos Vidal, SL (Hnos. Vidal) and Frutícolas Ateca, SL (Ateca), also affected TPFE penitentiary centers from February to March 2022.
Profit bag
The first cartel – Femar, its subsidiary Acacio, and Serviline – arranged a “joint profit pool” and operated thanks to the facilitator role of Llangon – a consulting firm for public tenders with no business volume in the affected market.
The exchange operated through a kind of subcontracting between companies. These were prohibited in most of the specifications or were not communicated to the contracting body. They were a subterfuge to compensate for the distribution of lots and comply with a 50/50 profit sharing.
The companies also exchanged sensitive commercial information about their profit margins on contracts; the prices they offered to a private client; their area of influence for operations; the tenders they were going to participate in, and even the password and digital certificate to access the contracting platform.
Minor contracts in penitentiary centres
The second and third cartels consisted of two anti-competitive agreements reached by Femar with Leonesa and two related companies: Hnos. Vidal and Ateca, respectively.
In the first agreement, when the contracting bodies invited them to participate in the competition, Femar agreed with Leonesa to submit reciprocal offers of coverage, sharing out the penitentiary centres based on their location.
In the second agreement, Femar also agreed with Hnos. Vidal and Ateca, linked by having the same administrators, to present coverage offers to share the contracts.
Fines for companies and managers
In total, the fines imposed on the companies amount to 3,137,500 euro for three violations of Article 1 of Law 15/2007, of July 3, on the Defence of Competition (LDC).
An administrative appeal may be lodged directly against this decision before the National Court within two months from the day following its notification.
Cartels and public procurement
These types of cartels are particularly damaging because they prevent companies from accessing the market, reduce competitiveness and affect the public budget. The CNMC has extensive documentation to guide public administrations in their contracting processes.
The CNMC thanks and invites contracting authorities to inform the CNMC or the regional competition authorities of any indication of anti-competitive practices in their contracting files.
