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The European Commission welcomed yesterday's judgments by the EU General Court in the TV and computer monitor tubes cartel (cases T-82/13 Panasonic/MTPD, T-84/13 Samsung SDI, T-91/13 LG Electronics, T-92/13 Philips and T-104/13 Toshiba) upholding the majority of the Commission's decision, regarding both the substantive issues and the general principles followed to set the level of fines (the fines remain the highest ever combined fines for cartels – just over € 1.4 billion).

These judgments are important for several reasons. First, they confirm the Commission's right to sanction cartels that concern products made from components of foreign origin and that are not themselves sold within the European Economic Area (EEA). The General Court confirmed in particular that the Commission had jurisdiction notwithstanding the fact that the cartels were formed outside the EEA. The cartel arrangements directly influenced the setting of prices and of volumes delivered to the EEA either as direct sales or as processed products.

Second, the General Court also agreed with the Commission's substantive assessment of the case, except for the individual participation of Toshiba as it considered that the Commission had not sufficiently established Toshiba's awareness of the overall cartel. The General Court found that the different sets of meetings (either in Europe or Asia) and different product variations were an integral part of a single and continuous infringement of EU antitrust rules. The cartel members continued their collusion even after alternative technologies (such as Liquid Crystal Displays, "LCD") started to replace the product and took action to jointly counter a decline in demand.

Third, some of the cartel members in this case formed joint ventures through which they continued their participation in the cartels. The General Court confirmed the Commission's decision, in line with established case law, that parent companies were liable for the illegal anticompetitive behaviour of joint ventures irrespective of the ownership shares (regarding both the Philips/LG Electronics and the Toshiba/Panasonic joint ventures). The General Court confirmed this for both joint ventures and rejected arguments based on lack of awareness of the joint ventures' participation in the cartels. The General Court agreed with the Commission's assessment on the participation of Philips, LG Electronics and Panasonic prior to creation of the joint ventures.

Finally, the General Court also confirmed the fines methodology, including the Commission's leniency assessment. However, it reduced the fines for Panasonic, Toshiba and MTPD as it found that the companies provided more detailed value of sales figures than what the Commission had used. Importantly, it agreed with the Commission that Samsung SDI had downplayed the nature of the cartel and that the contacts with other parties were clearly collusive.

Background

The Commission investigation started with unannounced inspections in November 2007, prompted by an application for immunity by Chunghwa.

On 5 December 2012 the Commission fined seven international groups of companies a total of € 1 470 515 000 for participating in either one or both of two distinct cartels in the sector of cathode ray tubes ("CRT"). One cartel concerned colour picture tubes ("CPT") used for televisions and the other one colour display tubes ("CDT") used in computer monitors. The undertakings involved were Chunghwa, LG Electronics, MTPD (former JV between Panasonic and Toshiba, and currently a Panasonic subsidiary), Panasonic, Philips, Samsung SDI, Technicolor (formerly Thomson) and Toshiba. Chunghwa received full immunity from fines under the Commission's 2006 Leniency Notice. Samsung SDI, Philips and Technicolor received reductions of their fines for their cooperation in the Commission's investigation.

The Commission found that for almost ten years, between 1996 and 2006, these companies fixed prices, shared markets, allocated customers and restricted their output. The cartel members also monitored the implementation of these measures. In the case of the CDT cartel this monitoring included plant visits to audit compliance with the agreed capacity restrictions. The cartels operated worldwide. Chunghwa, LG Electronics, Philips and Samsung SDI participated in both cartels, while Panasonic, Toshiba, MTPD and Technicolor participated only in the cartel for television tubes.

The two CRT cartels are among the most organised and active cartels that the Commission has ever investigated. Extensive cartel contacts took place during ten years, both at bilateral and multilateral level, including at the level of top management. The top management level meetings, dubbed "green(s) meetings" by the cartelists because they were often followed by a round of golf, designed the orientations for the two cartels. Preparation and implementation were carried out through lower level meetings, often referred to as "glass meetings", on a quarterly, monthly, sometimes even weekly basis. Some cartel members chose to participate only or mainly via bilateral contacts in order to reduce the risk of detection.

All companies, except Chunghwa and Technicolor, brought actions for annulment of the 2012 decision before the General Court.