Coded Messages and a 60 Million Euro Fine
Public procurement contracts for road repairs across Germany became the target of elaborate price-fixing schemes involving coded messaging, according to findings released by the Bundeskartellamt. Six companies operating in the road maintenance sector engaged in illegal market-sharing and bid-rigging practices over an approximately nine-year period, utilizing encrypted channels and coded terms such as “sausage price” or “beer price” to disguise their illicit communications. The Federal Cartel Office confirmed that it has issued binding fines totaling roughly 60 million euros against the corporate entities involved.
The Mechanics of the DKS Asphalt Cartel
The cartel specifically targeted specialized road maintenance procedures known as thin asphalt surface treatments in cold application, commonly referred to in the industry by the German acronym DKS. According to the federal regulatory authority, the participating companies established a system of territorial division where each firm laid claim to designated “regular customers.” When an enterprise performed DKS work for a client for the first time, it secured exclusive rights to service that customer for future projects under the terms of the conspiracy.
To maintain the illusion of competitive bidding, competing firms submitted coordinated sham proposals designed to ensure that the pre-selected provider always won the contract.
Encrypted Chats and Airports Targeted
Investigators uncovered that the companies utilized both in-person coordination meetings and digital messaging applications, including regular phone calls, emails, Signal, and WhatsApp chats. Within these digital exchanges, the conspirators masked agreed-upon monetary values behind numerical codes, mileage figures, and everyday consumer items such as food and beverage costs.
The Bundeskartellamt noted that the fraudulent network stretched far beyond municipal roads, impacting procurement bids issued by public agencies for infrastructure projects at airports, harbors, and automotive testing facilities nationwide.
Taxpayer Impact and Regional Scope
Economic analysis by the competition watchdog indicates that such coordinated bidding rings routinely inflate project costs by up to 15 percent, imposing a direct financial burden on public budgets and taxpayers alike. The administrative enforcement action concluded after the regulatory agency issued formal penalty notices totaling approximately 60 million euros, which are now legally binding.
While the affected companies included regional operators based in Lower Saxony—specifically within the districts of Emsland and Verden—the widespread nature of the market allocation affected public infrastructure spending across the country.
Simulated Competition Through Protective Bids
While traditional cartel behavior often relied on physical meetings, the Bundeskartellamt’s investigation revealed a heavy reliance on modern messaging platforms. By routing price agreements through encrypted applications like Signal and WhatsApp, the firms attempted to shield their communications from public and regulatory scrutiny. However, investigators successfully decoded the deceptive terminology—such as mileage counts and beverage pricing—that served as financial proxies for inflated project bids.
The market division strategy depended heavily on the submission of protective bids, known in German procurement as Schutzangebote. In a legitimate competitive market, independent contractors vie against one another to lower costs and secure municipal work. Under the DKS cartel structure, this competition was entirely simulated. Firms that had no intention of executing a project submitted formal bids formulated in consultation with the designated winner, thereby satisfying the legal requirements of public tendering while guaranteeing the predetermined outcome.
Scrutiny of Critical Transport Infrastructure
Public infrastructure spending in Germany relies heavily on transparent bidding processes to ensure efficient use of taxpayer funds. The 60 million euro penalty underscores the severity with which regulatory bodies view systemic manipulation of public tenders.
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