Damages related to asphalt cartel: the Supreme Court granted partial leave to appeal to Lemminkäinen and the city of Vantaa
Asphalt cartel issue
On 6 September 2017, the Supreme Court announced that it had granted leave to appeal to Lemminkäinen and the city of Vantaa regarding the legal proceedings concerning the damages related to the asphalt cartel. Concerning Lemminkäinen, there were 13 pending requests for leave to appeal submitted by Lemminkäinen as well as 19 requests for leave to appeal submitted by municipalities in the Supreme Court concerning the Helsinki Court of Appeal's decisions on 20 October 2016 regarding damages related to the asphalt cartel.
Lemminkäinen was granted leave to appeal in the cases concerning the cities of Mikkeli and Rovaniemi. The leave to appeal concerns the question whether the liability for compensation of Lemminkäinen has decreased due to the fact that the other parties' liability was time barred. The cities of Mikkeli and Rovaniemi were not granted leave to appeal. Later the Supreme Court granted Lemminkäinen leave to appeal also on the question related to value added tax on damages and legal expenses.
The Supreme Court announced on 18 June 2019 its decisions on matters related to the claims by the cities of Mikkeli and Rovaniemi. The Supreme Court approved for the most part YIT’s claims related to the question on the share of value added tax. Additionally, the Supreme Court approved partly YIT’s claim related to decreasing the damages due to dispersion of responsibility in the matter concerning the claim by the city of Rovaniemi. The Supreme Court dismissed YIT’s corresponding claim concerning the claim by the city of Mikkeli.
The leave to appeal granted to the city of Vantaa on 6 September 2017 concerns the question whether Skanska Asfaltti Oy, NCC Industry Oy and Asfaltmix Oy were liable for damages caused by the cartel to the city based on the fact that the companies had acquired businesses from companies involved in the cartel. The question whether leave to appeal will be granted to Lemminkäinen and to the city of Vantaa, concerning other than the above mentioned issues, will be resolved in connection with the appeal.
According to the Supreme Court's decisions on 6 September 2017, the applications for leave to appeal of 14 other cities or municipalities concerning Lemminkäinen were dismissed entirely. The application for leave to appeal by the city of Espoo will await the decisions to be rendered in the cases where leave to appeal was granted.
On 20 October 2016, the Court of Appeal of Helsinki gave its decisions in the legal proceedings concerning the damages related to the asphalt cartel. Regarding the 37 claims against Lemminkäinen, Lemminkäinen and other asphalt industry companies are entitled to receive reimbursements in total approximately EUR 20 million (consisting of capital amount of approximately EUR 14 million less as well as interest and legal expenses of approximately EUR 6 million less than according to the decisions of the District Court).
Of these reimbursements, Lemminkäinen is entitled to receive refunds (based on Lemminkäinen's own share and those shares of other defendants that Lemminkäinen has paid) in total approximately EUR 19 million consisting of capital as well as interest and legal expenses. Lemminkäinen recorded the reimbursement as income in its fourth-quarter result in 2016.
Lemminkäinen has as such deemed the claims for damages unfounded. After Helsinki Court of Appeal's decisions, Lemminkäinen has settled with 17 municipalities and the State of Finland. The parties agreed not to request leave to appeal from the Supreme Court or to withdraw their leave to appeal concerning the Helsinki Court of Appeal's decisions.
In addition, Lemminkäinen has been served summons regarding 21 claims against Lemminkäinen and other asphalt companies for damages. The capital amount of these claims is approximately EUR 26 million. For these claims, Lemminkäinen has made a provision worth EUR 4.0 million based on the Helsinki Court of Appeal's decisions and the subsequent Supreme Court’s decisions regarding the applications for leave to appeal. (Situation June 30, 2019).
Releases related on the issue
Summary of events
On 13 January Lemminkäinen settled with the State of Finland.
On 6 September The Supreme Court granted partial leave to appeal to Lemminkäinen and the city of Vantaa.
On 20 October 2016, the Court of Appeal of Helsinki gave its decisions in the legal proceedings concerning the damages related to the asphalt cartel.
On 19 December 2016Lemminkäinen requests leave to appeal for some of the Helsinki Court of Appeal's decisions regarding damages related to the asphalt cartel
|2014||31 March 2014 Lemminkäinen appeals against district court's decisions concerning damages related to the asphalt cartel.||31 Mar 2014|
|2013||The District Court´s decision on claims for damages.|
|2013||The District Court announces that it will announce its decisions on 28 November 2013.||8 Oct 2013|
|2012||Handling of claims for damages: Preparatory sessions for the trial begin in January 2012. The main proceedings will begin in September 2012 and are preliminarily planned to continue until April 2013. The ruling schedule is currently not yet available.|
|2009||Supreme Administrative Court decision: asphalt industry companies are ordered to pay an infringement fine totalling EUR 82.6 million for violating the Act on Competition Restrictions. In accordance with the Finnish Competition Authority’s proposal, the infringement fine imposed on Lemminkäinen totals EUR 68 million. Lemminkäinen expenses EUR 54 million for Q3 of the year.|
|2007||Lemminkäinen appeals to the Supreme Administrative Court against a Market Court decision.||19 Dec 2007|
|2007||Market Court decision: Asphalt industry companies are ordered to pay EUR 19.4 million in infringement fines, of which Lemminkäinen’s share is 14 million. Lemminkäinen expenses EUR 14 million for Q4 of the year.||19 Dec 2007|
|2004||The Finnish Competition Authority proposes that an infringement fine be imposed on seven asphalt industry companies and the Finnish Asphalt Association for violations against competition legislation in the suspected asphalt cartel matter. The Finnish Competition Authority proposes an infringement fine of EUR 68 million on Lemminkäinen.|
|2003||In June 2003, the Finnish Competition Authority submits a draft proposal to Lemminkäinen regarding a suspected asphalt industry cartel. In the draft proposal, the Finnish Competition Authority suspects that a nationwide cartel would have been operative in the asphalt industry in 1994-2002, with all significant industry actors participating.|