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South Korea probes ten LCD firms over collusion

South Korea's Fair Trade Commission has confirmed a large-scale probe into price fixing by LCD panel manufacturers, with ten local and international companies under investigation.

The fact that the FTC, South Korea's antitrust regulator, has been investigating allegations of price fixing between LCD panel manufacturers is well known - especially to Samsung, LG, and Chimei Innolux who were all found guilty of collusion on panel pricing last month - but the scale of the investigation was previously unknown.

According to the FTC's own figures, a total of ten companies are under investigation - including the three aforementioned guilty parties - in addition to five companies from Korea and Japan who make glass tubes for CRT-based displays.

"The LCD companies under investigation are suspected of colluding on prices and product volumes," an FTC official told The Wall Street Journal yesterday. "Depending on the outcome of the probe, the companies may face fines, a correction order or an investigation by prosecutors."

The probe follows similar investigations in both the US and the EU, which saw display manufacturers including LG fined millions in damages for the operation of a price-fixing cartel over a five year period. As a result of the collusion on pricing, it is alleged, OEMs using the company's panels were forced to pay inflated pricing - a cost which was then passed on to the consumer in the final retail price.

The former existence of a price-fixing cartel is hard for any of the companies involved to deny: fines charged to six companies following the European Commission investigation into the matter totalled almost €650 million, while the Department of Justice investigation led to seven companies coughing up $930 million between them.