- POSTED: 20 Aug 2014 13:38
- UPDATED: 20 Aug 2014 20:18
China has fined 10 Japanese auto parts firms more than US$200 million (S$250 million) for price-fixing, authorities said Wednesday (Aug 20), in what state media called the biggest-ever penalty for violating the anti-monopoly law.
SHANGHAI: China has fined 10 Japanese auto parts firms more than US$200 million (S$250 million) in total for price-fixing, authorities said on Wednesday (Aug 20), reportedly the biggest-ever such penalties, in the latest step of the country's anti-monopoly drive.
Beijing has over the past year launched a wide-ranging crackdown on alleged malpractice by foreign firms across diverse sectors, including pharmaceuticals, baby formula and technology, raising fears overseas companies are being targeted.
The auto parts companies were found to have implemented monopoly pricing agreements for more than 10 years, the National Development and Reform Commission (NDRC) regulator said in a statement. It fined them a total of 1.24 billion yuan (US$201 million), in what state broadcaster CCTV said was the biggest fine China had imposed since its anti-monopoly law took effect in 2008. "The companies... unlawfully affected prices of auto parts, finished vehicles and bearings in China and harmed the interests of downstream manufacturers and consumers," the NDRC statement said.
Sumitomo Electric was fined the most - 290.4 million yuan - of the seven car parts firms penalised for fixing auto parts prices between January 2000 and February 2010, according to the statement, the others being Denso, Aisan, Mitsubishi Electric, Mitsuba, Yazaki and Furukawa Electric. NSK, JTEKT and NTN were fined for price collusion over bearings between 2000 and June 2011, the NDRC added, with NSK ordered to pay 174.9 million yuan.
Two other companies, Hitachi Auto Parts and Nachi, which makes roller bearings, were found culpable but exempted from the penalties for taking the initiative to inform authorities and providing evidence on the monopoly agreements.
The NDRC, one of several Chinese government bodies that investigates monopoly actions, said in early August it was probing auto firms including Audi and Chrysler as well as the 12 Japanese companies for possible violations.
It is the latest in a series of inquiries in various fields which have raised investor concerns about the business climate in China. State media have reported that more than 1,000 companies in the country's auto sector, both domestic and foreign, are currently involved in anti-monopoly probes by the government.
In late July, authorities raided offices of Microsoft and investigated the US software giant for allegedly operating a monopoly in the Chinese market. State media have also said China is planning to announce that US chip maker Qualcomm has monopoly status in the mobile phone chip industry.
Police in May accused a top executive of British drugmaker GlaxoSmithKline of ordering employees to commit bribery in China, and handed the case over to prosecutors after a nearly one-year probe. Last year, the government fined six baby formula producers - all but one of them foreign - a total of US$108 million for price-fixing.
Chinese officials have denied that overseas firms are being targeted in the investigations, but foreign direct investment (FDI) into the country fell to a two-year low last month.
Five of the Japanese auto companies - Mitsubishi, Denso, Sumitomo, NSK and JTEKT - issued statements confirming the penalties and pledging compliance with Chinese law and regulations. Mitsubishi Electric said it "takes this matter very seriously" and "will comply with the order". Denso said it was its policy "to comply with all applicable antimonopoly laws". Both NSK and JTEKT said they took the situation with "utmost seriousness" while Sumitomo said its "highest priority" was to comply with competition laws.