Indecopi fines Odebrecht over four million soles for “obstructing” investigative work

The National Institute for the Defense of Competition and the Protection of Intellectual Property (indecopi) fined the Brazilian company more than four million soles for obstructing Odebrechtin the context of the case called “construction club‘.

Jesus Espinoza Lozadadirector of investigation and promotion of free competition of Indecopi, explained that the decision adopted by the organization was due to the fact that the construction company refused to provide important information for the investigation of the above case.

“At the time, when Indecopi carried out an investigation in 2017, he went to the offices of Odebrecht examine the information and documentation that was in the possession of the company, looking for evidence of the commission of anti-competitive behavior. They refused to allow the Indecopi inspectors access to the evidence and, for this reason, they ended up being penalized,” the executive told RPP Noticias.

The representative clarified that “it is a decision that can be appealed” before the Indecopi court, since the sentence pronounced is in first instance by Free Competition Commission. “The company is now in the appeal period, which is 15 working days. We will see if the company accepts the decision or appeals it,” he said.

“It is very important that companies make it clear that they cannot impede or interfere with the functions performed by the indecopi for the protection of market competition and consumer welfare. When companies are visited for evidence, they cannot refuse access to the Indecopi,” he added.

Moreover, he said that in this case of the ‘construction clubOdebrecht is “the only” company that has refused to let the inspectors do their job, knowing that “the rule” is that they allow free access to information.

“Here there is also a clear message, from the principle of authority, that Indecopi watches over the free competition and that companies must provide the necessary facilities to verify that regulations are being followed,” he commented.

He clarified that the type of information they could not access due to the refusal of the brazilian construction company these were electronic and physical records such as files and emails from executives who make decisions about pricing and how to participate in tenders.

“In the case ‘construction club‘, the majority of the companies allowed us to access it, except in the case of Odebrecht which did not allow us to access this type of information, which is important in order to be able to prove anti-competitive behavior,” said he recalled.

The ‘Construction Club’ is one of the most emblematic corruption cases detected in Peru with international significance. According to tax investigations, there was a cartel of construction companies that bribed an official of Provias Nacional in order to obtain the road infrastructure works for which the Ministry of Transport and Communications (MTC) had appealed for offers.

This notorious “club” was a cartel of Peruvian and foreign construction companies which, instead of competing with each other, agreed to share the work. A lava jato at the local level, as defined by those close to the survey.

Companies allegedly involved include Obrainsa, Grana and MonteroICCGSA, JOHESA, Grupo Plaza, Cosapi, General Contractors San Martín, Málaga Hermanos, H&H Casa, Odebrecht, AEOAndrade Gutierrez, Queiroz Galvao and Mota Engil.