News has come to light that China has imposed fines upon six South Korean and Taiwanese LCD makers for price fixing. The fines, totalling $56 million, follow a six year investigation and similar legal action in Europe, Korea and the USA. In December 2010 the European Commission fined the same six companies $650 million and South Korean Fair Trade Commission fined them $180 million, so the Chinese fine seems quite lenient.
Big BOM
LCDs are major components in many products such as smartphones, in car displays, Sat-Navs, tablets, computers and TVs. Often the LCD cost makes up a considerable proportion of the device’s bill of materials. The National Development and Reform Commission (NDRC) in China investigators said that representatives from the six firms met regularly between 2001 and 2006 to collude over pricing levels. The six companies cited in the case; LG Display, Samsung, Innolux, AU Optronics, Chunghwa Picture Tubes and HannStar sold 5.15 million panels and gained a combined $34 million in “illegitimate profits” according to the Chinese investigators.
China’s NDRC issued a statement on Friday saying that “When selling LCD panels in mainland China, the enterprises involved manipulated market prices based on prices agreed on and information exchanged during their meetings. This has harmed the legitimate rights of other manufacturers and consumers.”
A number of the companies fined have already officially responded. LG Display issued a statement saying that it “remains committed to operating with full transparency in providing the best quality products and services to its global customers”. Meanwhile a Samsung spokesman said the company will strive to “root out” activity related to collusion. Thanks guys!
History repeats
In a similar case, only a month ago, we reported on the European Commission (EC) ruling which imposed hefty fines on several producers of CRTs found guilty of price fixing between 1996 and 2006. The CRT price fixing fines were given to companies including Philips, LG, Panasonic, Samsung, Technicolor and Toshiba
(All monetary figures above have been converted to approximate US dollar values)
