European Commission fines smart card cartel
Written by staff reporter
The European Commission has found and sanctioned a cartel set up by companies producing smart card chips. The Commission has subsequently imposed fines totalling E138 million.
The companies involved were Infineon, Philips, Samsung and Renesas, a joint venture of Hitachi and Mitsubishi, which, instead of competing, colluded in order to coordinate their market behaviour throughout Europe.
In a statement, the Commission said these companies held contacts to discuss prices, price trends as well as production capacity. They also disclosed to each other their future market conduct, in general or for negotiations with individual customers. The cartel was organised through a network of bilateral contacts that took place between September 2003 and September 2005. These contacts allowed them to prepare their respective responses to customers' requests to lower prices.
European Commission vice-president, Joaquín Almunia said, “Such contacts were clearly anticompetitive since they reduced uncertainty concerning each other's behaviour on the market. The cartelists must have known that their conduct was illegal. Some of them even took measures to conceal the collusion.”
One company, Renesas, has received immunity from fines as it had revealed the existence of the cartel to the Commission. Samsung also received a reduction of 30% of its fine for cooperating with the investigation.
“The fine amounts imposed today reflect the gravity of the infringement, the turnover generated by the cartelised products and the duration of participation of each company in the cartel,” Almunia said. “After our investigation started, we also explored the possibility of settling this case with some of the companies involved. But in 2012 the Commission decided to put an end to the settlement talks since there was a clear lack of progress in these discussions.”