CRH Polish subsidiary faces €50m fine

Proceedings have been instigated against a Polish subsidiary of CRH, following allegations that an employee attempted to destroy information relating to a cartel investigation in Poland's cement industry, writes Emmet Oliver

The employee at the Ozarow subsidiary is accused of trying to delete sensitive data from her PC in the presence of competition investigators who have been conducting a cartel investigation since April.

CRH yesterday confirmed that its subsidiary is facing proceedings, but said Ozarow would be strongly defending its position. Ozarow, based in central Poland, is one of the largest producers of cement in Europe and the site has been visited by the Taoiseach, who was invited by CRH.

It is alleged an employee made an attempt to delete data when an unannounced visit was made to the Ozarow plant, but investigators still managed to recover most of it. This week, the competition and consumer protection office in Poland confirmed it was initiating proceedings. It said it was aiming to fine the Ozarow company for trying to hinder its investigation. It is not clear how much the fine might be, but Polish reports suggest it could be as high as €50 million.

A spokesman for CRH said it acknowledged that the competition and consumer office in Poland had initiated proceedings which would determine whether Ozarow had co-operated with an inspection that it carried out. He said Ozarow would be strongly defending its position.

In Poland there have been allegations that cement companies have artificially limited their production in order to keep prices high, although the cement companies are denying this. The authorities in Poland believe their investigations will end in charges.

Ozarow has been in the news before. Last June, it was reported that a Polish businessman told a parliamentary inquiry that he paid a bribe of almost $1 million (€827,000) on behalf of CRH to a Polish government minister.

Marek Dochnal told the inquiry he paid most of the sum to a former minister for privatisation, Wieslaw Kaczmarek, in connection with the privatisation of the cement plant at Ozarow in 1995.

Mr Dochnal said he paid Mr Kaczmarek between $600,000 and $700,000 in cash through an intermediary and transferred a further $250,000 to a Swiss bank account.

The Taoiseach visited the CRH plant at Ozarow in 2000 to open Europe's biggest cement kiln, and two CRH executives, Brian Griffin and Declan Doyle, were awarded national medals by Poland's president Aleksander Kwasniewski.

Poland and the Ukraine are important markets for CRH. Poland has benefited from the boom in EU investment, particularly in road construction.