On January 4, 2013, the Chinese National Development and Reform Commission ("NDRC") officially announced that Korean LCD panel makers Samsung and LG and the four Taiwanese LCD panel makers Chimei Innolux, AUO Optronics, Chunghwa Picture Tubes and HannStar were fined a total amount of CNY 353 million, i.e. USD 56 million for price-fixing of LCD panels in Mainland China.

Such fine includes CNY 172 million to be refunded to the Mainland Chinese color TV manufacturers as damage compensation, CNY 36.75 million confiscated as illegal gain and an administrative fine of CNY 144 million. The highest monetary sanctions were paid by LG (CNY 118 million) and by Samsung (CNY 101 million). This is the first time China has sanctioned foreign companies for price manipulation.

According to the National Development and Reform Commission (NDRC), the six LCD panel makers held 53 so-called "LCD panel meetings" between 2001 and 2006 in Taiwan and Korea to exchange market information of the LCD panels and to fix the prices of LCD panels supplied to the Mainland Chinese market. During this period, the six companies have sold approximately 5.14 million LCD panels in Mainland China.

Besides paying the monetary penalties, the six companies also promised to extend the guarantee period for the LCD panels sold to the Chinese color TV manufacturers from 18 to 36 months.

Since the Anti-Monopoly Law of China has only become effective in 2007, based on the  principle of non-retroactivity of laws,  the NDRC penalized the six companies pursuant to Article 14, Section 1 of the PRC Price Law. Pursuant to Article 40 (1), Section 1 of the PRC Price Law, companies may be subject to monetary penalties amounting up to five times their illegal profits. Taking into consideration the fact that the companies have made confessions about the violation, the NDRC has imposed more lenient sanctions.

Dr Jia Ding