Deutsche Bahn suppliers face cartel probe

German prosecutors are investigating whether up to 10 steel and rail companies operated an illegal cartel for at least a decade to fix the price of rails and defraud Deutsche Bahn, the national rail company, of millions of euros.

ThyssenKrupp, Germany’s largest steelmaker, confirmed on Thursday that one of its small subsidiaries is among the group being investigated for alleged anticompetitive practices.

Two local units of Voestalpine, the Austrian steelmaker, were also raided last month by German prosecutors on suspicion of anticompetitive behaviour.

A spokesman for Bochum’s state prosecution office said the probe is at an early stage and is being carried out with the Federal Cartel Office, Germany’s competition regulator. The regulator ordered raids on the suspected cartel participants last month because of suspicions companies had colluded to divide up rail contracts and fix prices.

It said it had cause to suspect the Deutsche Bahn collusion had begun in 1998 and was also investigating possible collusion involving sales to local and regional rail customers, industrial railways and building contractors, dating from 2001.

Deutsche Bahn is examining records of its rail purchases with a view to pursuing the rail providers for compensation. “As soon as we have a clear picture of the cartel from the investigation proceedings we will examine possible claims against the cartel members,” said Gerd Becht, DB board member in charge of compliance, privacy and legal affairs.

The German probe concerns 30 suspects in 10 companies. The regulator and prosecutors declined to name those involved.

ThyssenKrupp said it had a zero-tolerance policy towards anticompetitive behaviour and was co-operating with investigators.

Senior managers at ThyssenKrupp GfT Gleistechnik, a rail subsidiary with an annual turnover of about €300m ($436m) and 280 employees, have already been removed from their posts. ThyssenKrupp is working with its lawyers and external consultants to establish what happened.

“During the course of these inquiries, the suspicion of ‘anticompetitive collusion’ by individuals employed by ThyssenKrupp GfT Gleistechnik employees has hardened,” it said.

Voestalpine also said it was co-operating with the authorities.

Reports by WAZ, a German newspaper, estimated the total cost to DB in the high treble-digit millions over 10 years.

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