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Sony, Fuji and Maxell fined for tape price fixing

EU investigation into the cost of videotape sees €75 million in fines levelled against the three media manufacturers for offences over a three year period.

The European Commission hit three Japanese producers of videotape with almost €75 million in fines for fixing prices.

"Between 1999 and 2002, Sony, Fuji and Maxell managed to raise or otherwise control prices through a series of regular meetings and other illicit contacts," the European Union executive said in a statement.

Sony's fine was increased by 30 per cent to just over €47 million after it obstructed the investigation, the statement said.

The fines for Fujifilm Holdings and Hitachi Maxell were reduced by 40 and 20 per cent respectively - to €13.2 million and €14.4 million - after they co-operated with the investigation.

"This decision sends two warnings to companies engaging in cartel activities," European Competition Commissioner Neelie Kroes said in the statement.

"First, the Commission can prosecute cartels effectively even without prompts from immunity applicants, and second, obstructing a Commission antitrust investigation leads to severe penalties," she said.

The Commission started an investigation with raids on EU subsidiaries of Sony, Fuji and Maxell in May 2002.

The raids found "abundant evidence of cartel activities" although a Sony employee refused to answer questions by EU officials, in breach of Sony's obligations, and another employee shredded documents during the raid, the Commission said.

Sony acknowledged its involvement only after receiving a formal charge sheet from the Commission, it said.

The cartel covered the two most popular professional videotape formats at the time - Betacam SP and Digital Betacam which in 2001 had total annual sales of €115 million in the EU and other European countries.

Television stations and independent TV producers are the main customers for professional videotapes.

Sony, Fuji and Maxell, controlling more than 85 per cent of the professional videotape market, "organised three successful rounds of price increases and endeavoured to stabilise prices whenever an increase was not possible," the Commission said.

They also regularly monitored the implementation of price agreements and the evidence had details of 11 meetings at which the three companies organised their cartel, it said.

The fines were the first applied under new EU guidelines, which will generally increase such penalties for companies which fix prices or do deals to divide up markets.

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