LG Display loses cartel appeal, is hit with €210M fine
April 23, 2015 | 12:46
Companies: #european-commission #lg-display #lg-electronics #philips #samsung
The European Court of Justice has upheld a whopping fine against LG Display for its part in a cartel colluding to keep panel prices high.
Six Korean and Taiwanese display panel makers were brought in front of the European Commission in 2010 when it was discovered that they had been colluding to keep panel prices high between 2001 and 2006. Samsung avoided punishment by turning witness for the prosecution and providing the evidence that would see its fellow cartel members hit with serious fines, one of the largest of which at €215 million went to LG Display.
At the time, LG claimed that while it was indeed guilty the fine was too high and that the court had erred in taking panel sales to parent companies LG Electronics and Philips - which sold its stake in the company in 2008 - into account as such sales couldn't have been affected by the collusion on pricing. While the court agreed a €5 million drop to €210 million in 2014, LG has continued to press its case only to be rebuffed by today's ruling.
'The court states, first, that those sales must be regarded as sales made to independent third parties (external sales) and not as sales made to entities belonging to the same undertaking (internal sales),' the court explained in support of its ruling. 'LG Display does not form a single undertaking with its parent companies and therefore does not constitute a vertically-integrated undertaking. The Court then holds that the sales of LCD panels made by LG Display to its parent companies were properly included in order to calculate the amount of the fine. That is because the amount of the fine is solely determined according to the sales made on the market affected by the infringement, irrespective of whether the prices of those sales were or were not influenced by the cartel.'
The court has also ruled that LG's application for a partial immunity for 2005, in exchange for evidence it presented that the cartel continued into that year when its competitors had claimed the collusion had ended by 2004, is to be rejected as Samsung had already beaten it to the punch.
LG Display has not yet commented on the ruling.
Six Korean and Taiwanese display panel makers were brought in front of the European Commission in 2010 when it was discovered that they had been colluding to keep panel prices high between 2001 and 2006. Samsung avoided punishment by turning witness for the prosecution and providing the evidence that would see its fellow cartel members hit with serious fines, one of the largest of which at €215 million went to LG Display.
At the time, LG claimed that while it was indeed guilty the fine was too high and that the court had erred in taking panel sales to parent companies LG Electronics and Philips - which sold its stake in the company in 2008 - into account as such sales couldn't have been affected by the collusion on pricing. While the court agreed a €5 million drop to €210 million in 2014, LG has continued to press its case only to be rebuffed by today's ruling.
'The court states, first, that those sales must be regarded as sales made to independent third parties (external sales) and not as sales made to entities belonging to the same undertaking (internal sales),' the court explained in support of its ruling. 'LG Display does not form a single undertaking with its parent companies and therefore does not constitute a vertically-integrated undertaking. The Court then holds that the sales of LCD panels made by LG Display to its parent companies were properly included in order to calculate the amount of the fine. That is because the amount of the fine is solely determined according to the sales made on the market affected by the infringement, irrespective of whether the prices of those sales were or were not influenced by the cartel.'
The court has also ruled that LG's application for a partial immunity for 2005, in exchange for evidence it presented that the cartel continued into that year when its competitors had claimed the collusion had ended by 2004, is to be rejected as Samsung had already beaten it to the punch.
LG Display has not yet commented on the ruling.
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