Chunghwa Picture Tubes Ltd (中華映管), Taiwan’s third-largest flat-panel maker, was fined US$65 million by the US Justice Department after agreeing to plead guilty to taking part in a massive international conspiracy to fix the prices of liquid-crystal-display (LCD) panels, the glass display screens on many laptop computers, mobile phones, flat-panel TVs and hand-held devices, such as iPods.
The antitrust case was announced in Washington on Wednesday by Assistant Attorney General Thomas Barnett, who called it one of the biggest international price-fixing cases ever tackled by the department.
Chunghwa “is the first Taiwanese company to ever plead guilty to criminal charges in the United States for participating in a price-fixing conspiracy,” Barnett told reporters.
Other companies involved in the scheme were LG Display Co Ltd, and Sharp Corp of Japan.
The three agreed to pay US$585 million, of which LG paid US$400 million.
The case, which was filed in the US District Court in San Francisco, is “among the largest and most far-reaching price-fixing conspiracies the Antitrust Division [of the Justice Department] has ever detected,” Barnett said.
Taiwan is the world’s largest suppliers of LCD panels, overtaking South Korea last year. Chunghwa Picture is a major producer in Taiwan.
In response, Chunghwa Picture yesterday said: “This fine has been recognized in the accounts and therefore will not have a material impact on the company’s finances and sales.”
The company said it had booked the fine in its fthird-quarter financial results this year.
The Taoyuan-based company earned NT$113 million in the first nine months of this year, with revenues of NT$101.65 billion.
Chi Mei Optoelectronics Corp (奇美電子), another Taiwanese LCD panel supplier that was also involved in the price-fixing probe, said yesterday that a final ruling had yet to be made in its case.
In 2006, the worldwide market for panels was about US$70 billion.
“These price-fixing conspiracies affected millions of American consumers who use computers, cellphones and numerous other household electronics every day,” Barnett said.
Chunghwa was accused of conspiring with LG and other unnamed co-conspirators from September 2001 to December 2006 to fix the price of Thin-Film Transistor LCD (TFT-LCD) panels sold worldwide, the department said in a press release issued in Washington.
According to the US accusations, Chunghwa, LG and other unnamed co-conspirators illegally met in the US, Taiwan and South Korea to discuss the price of TFT-LCD panels, in a series of sessions Barnett said were called “crystal meetings.”
They agreed at those meetings to charge predetermined prices for standard-sized panels to purchasers throughout the world and “exchanged information on sales of TFT-LCD panels for the purpose of monitoring and enforcing adherence to the agreed-upon prices.”
The companies “have agreed to cooperate with the department’s ongoing antitrust investigation,” the department said.
“Today’s fines would have been significantly higher had they not done so,” Barnett said.
In addition, Taiwanese authorities may have been cooperating with the US in the case, Barnett said.
“We have been coordinating from very early on in our investigations with a number of other competition-enforcement regimes, not only in North America but in Asia as well as in Europe,” he said.
He described the Chunghwa-Sharp-LG conspiracy as an international “cartel.”
While no executives at the companies have been convicted of violations that would result in imprisonment, the investigation is continuing and Barnett said if individuals were convicted, “they would be subject to substantial prison terms.”
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