Electronics Production | May 19, 2010
Antitrust: Commission fines DRAM producers
The European Commission today adopted its first settlement decision in a cartel case involving 10 producers of memory chips or DRAMS used in computers and servers.
The fine totalling EUR 331 273 800 includes a reduction of 10% for the companies' acknowledgement of the facts. The addressees of the decision are: Micron, Samsung, Hynix, Infineon, NEC, Hitachi, Mitsubishi, Toshiba, Elpida and Nanya. Micron, however, was not fined because it revealed the existence of the cartel to the Commission. Cartel settlements allow the Commission to speed up investigations, free up resources to deal with other cases and generally improve the efficiency of its antitrust enforcement. "This first settlement decision is another milestone in the Commission's anti-cartel enforcement. By acknowledging their participation in a cartel the companies have allowed the Commission to bring this long-running investigation to a close and to free up resources to investigate other suspected cartels. As the procedure is applied to new cases it is expected to speed up investigations significantly, said Commission Vice President and Competition Commissioner Joaquín Almunia. The case The Commission has adopted a decision settling a cartel investigation and imposing a fine totalling EUR 331 273 800 on Samsung, Hynix, Infineon, NEC, Hitachi, Mitsubishi, Toshiba, Elpida and Nanya. The decision is also addressed to Micron, but because the company revealed the existence of the cartel to the Commission in 2002 it benefitted from full immunity from fines. All the companies are non-European except for one (Infineon, Germany), but they sell their products in the European Economic Area (EEA) and, therefore, must also abide by EU law, in this case Art 101(1) of the EU Treaty , which bans practices restrictive of competition . The case was also investigated in the United States. The fines take into account the sales of the companies involved in the EEA, the very serious nature of the infringement and its geographical scope. The individual fines are as follows: Micron received full immunity because it was the first to inform the Commission. Between December 2003 and February 2006, Infineon, Hynix, Samsung, Elpida and NEC also applied for leniency under the EU's Leniency Notice. The Commission took account of their cooperation in the investigation and granted a reduction of respectively 45% (Infineon), 27% (Hynix) and 18% (Samsung, Elpida, NEC). Due to mitigating circumstances, the fine of Hynix was further reduced by 5% for Hynix and by 10% for Toshiba and Mitsubishi. Finally, all companies benefitted of a reduction of 10% for settling the case with the Commission. The overall cartel was in operation between 1 July 1998 and 15 June 2002. It involved a network of contacts and sharing of secret information, mostly on a bilateral basis, through which they coordinated the price levels and quotations for DRAMs (Dynamic Random Access Memory), sold to major PC or server original equipment manufacturers (OEMs) in the EEA. DRAMs is a common model for "dynamic" semiconductor memories for personal computers (PCs), servers and workstations.