The well-known company PORR comes from Austria, but has also been doing well in Poland for years. In our country it is most associated with investments in road construction.
The giant gives the appearance of greatness. In the 2022 ranking of construction companies, PORR took third place. However, this information also contains a dark side of the company. Finally, it was time for PORR, and the agencies involved dealt with the company’s suspicious activities.
The shady dealings involving PORR came to light when a corruption scandal broke out in connection with the construction of the fourth metro line in Budapest. It was the largest case of this type that occurred during Hungary’s membership of the European Union at the time. According to the OLAF (European Anti-Fraud Office) press service, the investment costs amounted to EUR 1.7 billion and were co-financed by the European Union Cohesion Fund. It emerged that serious irregularities, including fraud and suspected corruption, were identified at every stage of project implementation. The investigation into this case ended in December 2016, but OLAF began its investigation in 2012. PORR was also among the companies whose names emerged in connection with the publicized abuses.
“Both companies and high-ranking individuals are involved in the corruption scandal. The report included companies such as: DBR Metró Projekt Igazgatóság, Euro Metro Kft., Strabag, Siemens, Alstom, Hídépítő Zrt., the Bilfinger-Porr-Vegyépszer Zrt. consortium, the Swietelsky consortium, the Bamco consortium”, read more anticorruptionwebsite.gov.pl
PORR convicted of price fixing
PORR’s antitrust activities went back much further than 2012, when OLAF’s investigation into the Budapest metro began. According to the Federal Competition Office in Vienna (BWB), the violations, mainly in the road construction segment, lasted from at least 2002 until 2017, when the defendants’ homes were searched and they gave their first statements.
Together with six subsidiaries, PORR formed a cartel that violated the antitrust ban for years. Activities undertaken in this regard include: joint pricing, market sharing and exchange of sensitive competitive information when submitting tenders. Ultimately, PORR confirmed the allegations received and the Cartel Court ruled in this case on February 17, 2022 at the request of BWB. It imposed a fine of EUR 62.35 million on the above-mentioned company and its subsidiaries.
Poland’s PORR responded evasively that it could not speak on behalf of its Austrian colleagues. “PORR SA, with registered office in Warsaw, was not the subject of antitrust proceedings in Austria. We would like to inform you that we have no grounds, including legal grounds, to speak on behalf of other companies in the PORR group,” we read in the response to our editors.
Instead, we publish information sent via PORR, based in Warsaw, by the PORR communications department in Vienna. “PORR and some of its subsidiaries were fined EUR 62.35 million by the Cartel Court in 2022. The procedure is therefore closed. The procedure at the Federal Office for Competition Protection (BWB) has also been closed. PORR has fully cooperated. with the authorities in connection with collusion in violation of the antitrust prohibition in Austria. As a result of these incidents, PORR has taken a number of actions to combat antitrust violations. No proceedings against PORR have been initiated in Metro 4 in Budapest.”
More than 1,300 suspicious investments
As you can read in the judgment, PORR and the other defendants provided a list of exactly 1,362 construction investments that violated the antitrust prohibition. It cannot be ruled out that there were more such construction projects, but there is no way to prove this. The companies also submitted documents confirming the so-called compliance measures, that is, activities that had to confirm that the activities carried out were in accordance with the law and internal regulations. Efforts to end the proceedings amicably contributed to a quicker resolution of the case and ultimately to a more lenient sentence.
Seven companies that acted as suspects in the case participated in suspicious investments and tenders. PORR was the main respondent. Along with him there were companies that were subordinate to him or partially subordinate to him. All related to the construction sector.
Unequal battle against the competition
PORR and its subsidiaries would create a cartel with the main aim of eliminating or at least minimizing competition during tenders. The companies supported each other and secured their market share. For this purpose, there was long-term price fixing, market sharing, coordination of steps taken in submitting tender offers and even the creation of tender groups.
The content of the court’s judgment explains that in the case of prices, the prices were those agreed by the companies before submitting their offers. Sometimes the discussions led to the decision that certain companies would not participate in a particular tender. One was selected from the participants who emerged as the winner. On this basis, the prices to be submitted by each company to the tender were determined.
Price collusion was accompanied by market division. As above, it was mutually agreed which company would receive a particular contract. In some regions there is general agreement about which company should dominate there.
All these activities were accompanied by the exchange of sensitive competitive information, so-called discussion rounds. These were conversations that took place one or more times a year between entrepreneurs who belonged to the cartel. These usually took place at the headquarters of one of the companies involved in a particular case. At that time it was determined which of them would receive a particular contract, while the others would submit higher bids in the tender.
In addition to the discussion rounds, not only bilateral conversations were organized, but also by telephone or e-mail. They generally complemented the above discussions. Sometimes they took place outside company branches, for example at gas stations, bars and even construction sites. It happened that parties encrypted their messages during electronic contact, so the amount of money to be deposited was called the house number.
Interestingly, to distribute orders fairly between companies, the so-called fixed key. These were estimated market shares or an estimate of the amount of asphalt mixture that would be used during the year. To ensure that all companies comply with the agreements, appropriate safeguards have been implemented, i.e. cartel stabilizing measures. These include, among others, an established “points system” that ensures the financial balance of interests between companies, as well as subcontracting agreements for a particular construction project or the provision/acceptance of services on preferential terms.
Ruling in the PORR case
As you can read in the judgment awarded to the Austrian cartel. “The system of price fixing, market sharing and information exchange between defendants and their competitors in the period from July 2002 to October 2017 constitutes a violation of the provisions of art. 101 section 1 letters a and c TFEU and section 1 section 2 points 1 and 3 KartG (…) The conduct of the respondents is contrary to the objectives of initiating the award or tender procedure.
In the case of charges against PORR and its subsidiary companies, the case could have resulted in a financial penalty. As the Cartel Court judgment further states, “the findings demonstrate that the respondents’ violation of antitrust law is uniform and continuous, as all individual violations are based on a uniform overall plan and system. Since the offenses ended less than five years before the filing of the criminal application, there was no limitation period.”
The financial penalty can amount to a maximum of 10%. total turnover achieved in the previous year. It should be noted that this applies to turnover worldwide, including in Poland. Ultimately, the fine imposed on the companies was lower than the maximum possible and amounted to 62.35 million euros.
PORR problems in Poland?
PORR appeared on our domestic market more than 30 years ago and has been operating here since 2017 under the name PORR SA. Although the cartel case took place in Austria and ended with a verdict in 2022, this is not the end of the problems facing PORR in Poland. It appears that the company does not have the trust of some employees. Their comments on the GoWork.pl website prove this.
People claiming to be employees or former employees of the company’s Gdańsk branch report negative and even vulgar attitudes towards women. They were reportedly subjected to bullying and all attempts to raise awareness of the issue were swept under the carpet. Ultimately, PORR promised to handle the case – which it stated in a message on its website – but it is not known whether this ultimately happened. “PORR SA (with registered office in Warsaw) continuously monitors the opinions posted on Gowork.pl. We approach each report individually, try to find out the actual state of affairs and respond if necessary,” Poland’s PORR told us .
Source: Do Rzeczy

Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.