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Brits Investigating Whether Concrete Markets Are Crushing Competition

Posted  February 1, 2012

The United Kingdom’s Office of Fair Trading (OFT) is calling in reinforcements to expand Great Britain’s investigation into whether competition is being blocked in the markets for concrete and its main ingredients, aggregate and cement.

The OFT has referred Great Britain’s aggregates, cement, and ready-mix concrete markets to the U.K.’s Competition Commission, an independent body that conducts in-depth investigations into mergers and markets.

The OFT, which has been investigating these markets since 2010, announced that it has concerns that the markets “are not working well.”  In particular, the OFT notes that  five major players account for upwards of 90% of the cement market, 75% of aggregates sales, and around 70% of ready-mix production.

The big five firms are London-based Anglo American Plc, Germany’s Heidelberg Cement AG, Switzerland’s Holcim Ltd., Paris- based Lafarge SA, and Mexico’s Cemex SAB.

The OFT also believes that there are high barriers to entry, vertical integration, and multiple contacts and information exchanges across the markets.

If the Competition Commission concludes that any feature or combination of features in these markets prevents, restricts or distorts competition, the Commission must seek to remedy the problems that it identifies either by introducing remedies itself or by recommending action by other British agencies.

Tagged in: Antitrust Enforcement, International Competition Issues,