EU slaps huge fine on S. Korea, Taiwan LCD cartel

The European Commission has imposed €649 million in fines on South Korean and Taiwanese electronics firms for secretly fixing prices of LCD flat screens for Europe’s TVs and computers.

A number of the companies indicated that they might appeal.

The fines, worth 860 million dollars, were slapped on Taiwan’s AU Optronics, Chimei InnoLux Corporation, Chunghwa Picture Tubes and HannStar Display Corporation along with South Korean firm LG Display.

The leader in the LCD business, South Korea’s Samsung Electronics, was also accused of being part of the cartel but escaped cash sanctions for coming forward first with information on the alleged scheme.

“Foreign companies, like European ones, need to understand that if they want to do business in Europe they must play fair,” European competition commissioner Joaquin Almunia said in a statement.

“The companies concerned knew they were breaking competition rules and took steps to conceal their illegal behaviour,” he said.

Europe’s competition watchdog accused the firms of running a cartel between October 2001 and February 2006 that fixed prices, harming European buyers of televisions and computers equipped with liquid crystal displays.

The companies held monthly meetings to agree on price ranges and minimum prices, and traded information on future production planning, capacity utilisation, pricing and other commercial conditions, the commission said.

Company officials met 60 times, mainly in hotels in Taiwan, for what they dubbed “the Crystal meetings”, the regulator said.

“The fact that the cartel meetings took place outside the EU is no excuse,” Mr Almunia told a news conference, saying the group was “very well organised.”

The investigation found that the companies knew they were breaking competition rules and took steps to conceal their meetings.

The commission cited a document urging everybody “to take care of security/confidentiality matters and to limit written communication.”

Chimei InnoLux faces the largest fine, €300 million, followed by €215 million against LG Display.

AU Optronics was fined €116.8 million, followed by €9 million for Chunghwa Picture Tubes and €8.1 million for HannStar Display.