Following dawn raids conducted in June 2011, the European Commission ("Commission") fined five suppliers of car safety equipment a total of EUR 34 million on 22 November 2017 for cartel activities that mainly took place in Japan, but which may have had significant impact on European customers. The Commission found that the suppliers coordinated prices, markets and exchanged sensitive information, raising costs for manufacturers and potentially affecting consumers. Two suppliers received immunity for separate infringements for revealing the existence of the cartels, while all five parties received 10% reduction in fines under the EU settlement procedure.
Tokai Rika, Takata, Autoliv, Marutaka and Toyoda Gosei supplied seatbelts, airbags and steering wheels to the car manufacturers Toyota, Suzuki and Honda. The suppliers were found to have held meetings at their business premises, restaurants and hotels and exchanged emails to coordinate the prices, markets and exchange sensitive information for the supply of car safety components to the car manufacturers in the European Economic Area ("EEA").
Although the conduct mainly occurred in Japan, the Commission noted the potential significant effect on European customers, as one out of every 11 cars sold in Europe is produced by a Japanese car manufacturer and the three car manufacturers concerned have manufacturing plants in the EEA. Commissioner Vestager also commented that the Commission will not accept cartels organised outside Europe if they have an impact on European consumers.
As regards leniency and settlement, out of the four separate infringements, Takata and Tokai Rika received:
- full immunity from three infringements; and
- entered into settlement in relation to the other infringement.
By doing so, Takata avoided EUR 74 million of fines. Autoliv and Toyoda Gosei also received reductions in fines under the Commission's leniency notice for cooperating and providing the Commission with additional evidence.
All five suppliers benefited from a 10% reduction in fines for acknowledging their involvement in the cartels in order to settle the case.
This decision indicates the Commission's continued efforts in investigating suspected cartels in automotive parts sector and acts as a reminder of the Commission's jurisdiction over cartels outside the EEA which impacts European customers. As fate would have it, on 12 December, the Supreme Court of Japan make a mirror judgment - that the Japan's antitrust law applies to conduct outside Japan so long as it harms competition within the country, even if the original sale of the cartelised product occurred in a foreign nation.
Co-author: Louisa Wong
All articles in the December edition of the Competition newsletter
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