The EU Commission has announced a settlement imposing significant fines on Sanyo, Sony and Panasonic for breaching competition law. The fines relate to anti-competitive behaviour between 2004 and 2007 surrounding the distribution of rechargeable lithium-ion batteries. These batteries power most mobile phones, laptops and tablets.
Anti-competitive behaviour
The Commission investigation showed that the companies had been involved in discussions to avoid aggressive competition in the market for lithium-ion batteries. These discussions occurred mainly in Asia but sometimes in Europe. Even if discussions had taken place solely in Asia, the Commission could still have found them to be in breach of competition law if the behaviour was likely to cause a distortion to the European marketplace.
The cartel agreed on temporary price increases in 2004 and 2007 following increases in the price of a cobalt and exchanged commercially sensitive information concerning price, supply and demand forecasts, along with intentions to tender for particular contracts.
Settlement and fines
In determining the fines the Commission took into account the companies’ sales of lithium-ion batteries in the European Economic Area (EEA), the nature of the infringement, its geographic scope and duration but also the level of co-operation displayed by the firm with their investigation. Settlement alone resulted in a 10% reduction in each firm’s fine, while co-operation garnered reductions of between 20% – 50%.
Another manufacturer was given immunity for blowing the whistle on the arrangement. Regular readers of the blog will know that early and complete co-operation with a Commission investigation is generally recommended course of action and that whistle blowers always benefit.
In the end, Sony was fined €29,802,000, Panasonic €38,890,000 and Sanyo €97,149,000.
Follow on claims
As with all Commission findings of anti-competitive behaviour, it is held to be “self-proving” evidence that the behaviour took place and was illegal. Thus, if a person or business has suffered loss on account of the behaviour, they can raise a claim in their national court seeking a remedy. New rules are coming into force from 27 December 2016 that will make it easier for consumers and small businesses to pursue these claims.
FURTHER ADVICE
If you would like to discuss any of the issues covered in this article or require any advice about competition law issues, please contact Rod Lambert or Charles Livingstone in Brodies’ Public Law and Regulatory Team.
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