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GVH Uncovers Railway Procurement Cartel with Heavy Fines

12.12.2024 | 🇭🇺 Hungarian competition authority

The Hungarian Competition Authority (GVH) has revealed a cartel involving multiple companies in a railway development procurement, resulting in a total fine of 1.2 billion HUF for the Homlok Group.


The Gazdasági Versenyhivatal (GVH) has uncovered a significant cartel involving several companies during a public procurement process for railway infrastructure development in the Debrecen area, valued at tens of billions of HUF. The Homlok Group, which coordinated the cartel, has been fined a total of 1.2 billion HUF for its role in the illegal collusion.

The investigation began in January 2023 when the GVH suspected that certain companies were engaging in unlawful discussions regarding bid prices and the selection of the winning bidder for the tender issued by NIF Nemzeti Infrastruktúra Fejlesztő Zrt. The GVH conducted unannounced inspections at the companies involved, gathering evidence that confirmed the initial suspicions of cartel behavior.

It was revealed that Homlok Kft. and Homlok Zrt., part of the Homlok Group, colluded with Inter Mobility Kft. to ensure that Homlok Kft. would win the tender. The companies agreed to submit bids that would guarantee one of them would be the winning bidder, coordinating their bid prices and submission materials under the direct supervision of a procurement consulting firm controlled by the Homlok Group.

Despite the serious nature of the violations, the Homlok Group did not defend itself during the proceedings and failed to participate in scheduled hearings, leading to an additional procedural fine of 25 million HUF. In contrast, Inter Mobility Kft., which had a significantly lower revenue, cooperated with the GVH and received a reduced fine of 30 million HUF after submitting a leniency application and committing to a compliance program.

The GVH emphasizes that restrictions on competition in public procurement processes are among the most severe violations of competition law, which can lead to criminal consequences. The authority is actively working to dismantle procurement cartels, as they undermine fair competition and typically result in higher prices.

In recent years, the GVH has uncovered several cartels, including those involving shipping companies on the Danube and firms engaged in road marking and signage. Ongoing investigations into similar cartel activities are also in progress.

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