Memory makers fined £284m for price fixing

Memory makers fined £284m for price fixing

Summary: The European Commission has levied penalties against Samsung, Hynix and seven others after they admitted they colluded to fix DRAM prices

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TOPICS: Government UK
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The European Commission has fined nine producers of DRAM memory chips a total of €331m for their participation in a price-fixing cartel that operated between 1998 and 2002.

The cartel involved a network of contacts and the sharing of secret information, through which the nine companies coordinated price levels and quotations for DRAM memory sold to major European PC or server manufacturers, the EC said.

The penalties, announced on Wednesday, mark the European regulators' first settlement decision in a cartel case under a procedure introduced in 2008. The procedure allows companies to get a 10 percent reduction in fines — totalling €331m (£284m) — in return for admitting their guilt.

"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," said competition commissioner Joaquín Almunia in a statement. "As the procedure is applied to new cases, it is expected to speed up investigations significantly."

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The fines included €145.7m for DRAM market leader Samsung and €51.47m for Hynix Semiconductor, the second-largest DRAM maker. Infineon was fined €56.7m, Hitachi: €20.4m; Toshiba: €17.6m; Mitsubishi Electric: €16.6m; and Nanya Technology: €1.8m.

Elpida Memory was fined €8.5m jointly with NEC and Hitachi, while NEC was fined €2.1m jointly with Hitachi to account for the companies' period as a joint venture. NEC was fined €10.3m separately.

Micron also participated in the cartel but was not fined in exchange for its role in blowing the whistle on the scheme in 2002.

The Commission has said the new settlement procedure is a more effective way of deterring violations and reducing the length of administrative proceedings. The body has the right to fine companies up to 10 percent of their global turnover.

Topic: Government UK

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