The Fair Trade Commission yesterday levied fines totaling NT$5.8 billion (US$175.5 million) on 10 aluminum and tantalum capacitor manufactures for colluding with rivals to fix prices.
It is the biggest penalty the commission has handed down on international companies since it was established in 1992.
Taiwan is the first among authorities in Europe, Singapore, South Korea, China and the US — who have been collaborating on investigations into the case — to take regulatory action against the offending companies, the commission said.
The commission launched joint investigations with its international counterparts in March last year, and uncovered evidence showing that the 10 companies had violated cartel and antitrust laws between 2005 and January last year, although several Japanese companies had been conspiring together since the 1980s.
A leniency program that was introduced under the Fair Trade Act (公平交易法) in November 2011 played a crucial rule in the case, as the measure compelled several companies to come forward as whistle-blowers in hopes of gaining immunity or reduced penalties, the commission said.
The leniency program was adjusted this year to grant reduced penalties in cases that occurred five years ago, up from the previous three years.
This collusion had severely affected the function of the capacitor market in Taiwan, the commission said, adding that domestic companies source about 97 percent of their aluminum capacitors and all of their tantalum capacitors from abroad.
“In light of their heavy reliance on imports, we expect local companies such as Delta Electronics Inc (台達電), Hon Hai Precision Industry Co (鴻海精密) and Innolux Corp (群創) to benefit, as capacitor prices are once again determined by the market,” Fair Trade Commission Vice Chairman Chiu Yung-ho (邱永和) said.
The commission declined to comment on the extent of cost savings that local companies might expect to see as a result of the penalties, saying that its mission is to ensure free-market competition.
“This case will undoubtedly have sweeping ramification, as products made by Taiwanese companies are shipped to markets around the world, we expect them to face penalties in other countries in the near future,” Chiu said.
Given their larger footprint, aluminum capacitors are used in power supply units for larger products such as desktop computers and home appliances, while tantalum capacitors are used in portable computers and gaming consoles.
The list of offending companies includes seven Japanese aluminum capacitor manufacturers and their Taiwanese and Hong Kong-based subsidiaries — Nippon Chemi-Con Corp (NCC), Rubycon Corp, Sanyo Electric Co and Nichicon Corp as well as three tantalum capacitor makers — Japan’s NEC Tokin Corp and Matsuo Electric Co Ltd and US-based Vishay Polyptych Co Ltd.
Statistics show that over the past decade, Taiwan imported NT$50 billion worth of aluminum capacitors and NT$16 billion worth of tantalum capacitors.
NCC, Rubycon and Nichicon are the top three aluminium capacitor companies in the world, while the three tantalum capacitor companies involved have considerable global market share, the commission said.
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