PRODUCERS

OF CRT

GLASS CASE

Presented By Tingting Guo, Faraz Rahman, Marion Philippon, & Anna Le Breton

Facts The Commission carried out an inspection at the manufacturing facility of CRT Glass sector with the belief that some companies were involved in anti-competitive activities.

The Companies allegedly involved in the Cartel were:Asahi Glass Co LtdNippon Electric Glass Co LtdSamsung Corner Precision Materials Co LtdSchott Ag

Based on further investigations, the Commission released a decision ruling that these companies were involved in a Cartel (from 23rd Feb 1999 to 27th Dec 2003) resulting in a “single and continuous infringement” of Article 101 of the Treaty of Functioning of the EU and Article 53 of the EEA Agreement in the sector of CRT Glass production. The Cartel was involved in price coordination covering the EEA’s territory.

Reduction under the Leniency

Notice

Reduction under the settlement

Notice

Fine (Eur)

SCP 100% 10% 0

NEG 50% 10% 43,200,000

Schott Ag - 10% 40,401,000

Asahi Glass Co - 10% 45,135,000

Fines Imposed by the Decision

First Article Applicable on this Case

Article 101 (ex Article 81 TEC) of TFEU

The following shall be prohibited as incompatible with the internal market: all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the internal market, and in particular those which:

Directly or indirectly fix purchase or selling prices or any other trading conditions; Limit or control production, markets, technical development, or investment; Share markets or sources of supply; Apply dissimilar conditions to equivalent transactions with other trading parties,

thereby placing them at a competitive disadvantage; Make the conclusion of contracts subject to acceptance by the other parties of

supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.

Article 53 of EEA Agreement

The following shall be prohibited as incompatible with the functioning of this agreement: all agreements between undertakings, decision by associations of undertakings and concerted practices which may affect trade between contracting parties and which have as their object or effect the prevention, restriction or distortion of competition within the territory covered by this agreement, and in particular in those which, Directly or indirectly fix purchase or selling price or any other conditions Limit or control production, markets, technical development or investment Share markets or sources of supply Apply dissimilar conditions to equivalent transactions with other trading parties,

thereby placing them at a competitive advantage Make the conclusion of the contracts subject to acceptance by the other parties of

supplementary obligations which, by their nature or according to commercial usage, have no concentration with the subject of contracts

Second Article Applicable on this Case

The Cartel’s timeline23/02/99

First Meeting /

Begging of the cartel

02/03/99First

(bilateral) meeting including

AGC

14/07/01

AGC only contributed to a limited extent to the

cartel and was not involved in all of its

aspects

12/07/01 03/12/02

Significantly fewer instances of anti-

competitive contracts

07/03/03AGC

coordinate the output of CRT glass

Limited cartel activity for AGC

27/12/04NEG and

SCP leave the cartel / end of the

cartel

10/05/04Schott’s

leaves the cartel

04/10/04AGC leaves the cartel

2008The

Commission starts

investigating

Procedure

29/06/10Proceedings are initiated

13/07/10 01/07/11

Settlement discussions / The cartel members submit their formal request to settle

29/07/11The Commission adopts a statement of

objections / The parties confirm the content reflecting their submissions / They remain committed to the settlement procedure.

17/10/11The Advisory committee on

restrictive practices and dominant positions issued a

favorable opinion.

19/10/11The

Commission adopt the decision

The commission decisionReduction under

the leniency Notice

Reduction under the Settlement Notice Fine(EUR)

Samsung Corning Precision Materials

Co.,Ltd.100% 10% 0

Nippon Electric Glass Co.,Ltd. 50% 10% 43 200 000

Schott AG _ 10%40 401 000

(+ 18% reduction for cooperation outside the

Leniency Notice)

Asahi Glass Co.,Ltd. _ 10%45 135 000

(+ 15% reduction for a limited involvement in the

cartel)

Defense

Company overview

Healthy and stable company: 11 billion EUR of worldwide turnover 2010

Glass and glass related products manufacturedGood reputation and well established company in

the sector

Too risky to get into a cartel No interest

Strategy entry mode: Merger

No subsidiaries in EEAWill to expand the marketGain in market sharesSharing know how, supply processes, customer

data-base,,,Strategy entry mode: merger

Transparency of the information and meetings

A limited involvement in the cartel

The Commission itself recognized that AGC was involved in the cartel to a very limited extent:

“From 2 March 1999 to 14 July 2001,AGC was involved only to a limited extend in the cartel’s activities. It only participated in some bilateral cartel meetings during that period and did not take part in trilateral cartel meetings attended by NEG, SCP and Schott”.

“AGC’s cartel contacts were in that period also more sporadic than those of other participants. Therefore, it is considered that AGC contributed during this period only to a lesser extent to maintaining the cartel and was not involved in all of its aspects”.

Its alleged involvement was really short

23/02/99 (Start of cartel)

Not involved

in the cartel

02/03/99(Date to join) 14/07/01

04/10/04(Quitting date)

27/12/04(End of cartel)

involved in the

cartel to a limited extent

Not involved

in the cartel

involved in the

cartel to a

limited extent

Not involve

d in the

cartel07/03/03

Creation of the cartel 23rd of February 1999

Third parties initiative

Samsung Corning Precision Materials Co

Nippon Electric Glass Co.

Schott AG

Asahi Glass Co.

1st involvement on the 2 March 1999

Limited involvement

Limited involvement

AGC only took part in very few bilateral meetings

They did not take part in any of the trilateral meetings

AGC was not involved in direct price co-ordination

Their involvement in the Cartel was to a limited extent

Their involvement was very irregular and was not so transparent as compared to others in Cartel

Limited Involvement

AGC dropped out of Cartel in 27th December 2004

AGC was the second company after Schott to drop from the Cartel

Others were still involved in the Cartel

Span of Cartel involvement of AGC was of 3 years 11 months

(TITLE) our behavior might have been negligent. (Anna)

70% reduction of its fine

Accordingly to those fact, AGC can ask for a 70% reduction of its fine.

Explanation of Keywords

CARTELA cartel is a group of similar, independent companies which join together to fix prices, to limit production or to share markets or customers between them.This is why cartels are illegal under EU competition law and why the European Commission imposes heavy fines on companies involved in a cartel.

ANTITRUSTCompetition is a basic mechanism of the market economy which encourages companies to offer consumers goods and services at the most favorable terms. It encourages efficiency and innovation and reduces prices. In order to be effective, competition requires companies to act independently of each other, but subject to the competitive pressure exerted by the others.