Japanese auto bearings suppliers fined for antitrust violation

Want China Times, Staff Reporter 2014-08-20

Japanese NTN staff prepare for a product show in Nanjing,
Jiangsu province. (File photo/Xinhua)

China's National Development and Reform Commission (NDRC) fined two Japanese suppliers of automotive bearings Tuesday for market monopolization practices, reports Shanghai's National Business Daily.

Nippon Seiki KK issued a statement on its official website that the Chinese regulator has ordered the company to pay a fine of 174.9 million yuan (US$28.5 million).

NTN Corporation also stated that the NDRC has fined the company 119.2 million yuan (US$19.42 million).

NSK and NTN are the two of the largest manufacturers of bearings in Japan.

The Japanese companies were ruled to engage in common bid-rigging practices, in which the bidders take turns to win contracts.

In China's auto parts industry, Japanese and South Korean firms have relatively closed their supply chain. It has been a tradition for Japan and South Korea to be protective towards domestic automotive parts suppliers.

In addition, an analyst said that Japanese firms have the technological edge over other firms, making it easy for them to conduct horizontal monopolization, in which bid-rigging is the most common practice, according to the report.

Japanese auto parts companies have faced antitrust probes in the United States and Europe. They have also been punished in Canada, the European Union, Singapore and Australia earlier this year for price fixing.

It was reported that over ten Japanese parts suppliers have been accused of violating China's antitrust laws. The automotive parts involved include panel switches for heater controls, steering wheels, seat belts, wiper blades and airbags.

According to China's Anti-Monopoly Law, businesses that take advantage of their dominance in the market or agree to and implement price fixing have to pay a fine of 1%-10% of their one-year sales, along with their illegal gains being confiscated.

Some analysts said that overseas auto parts makers have earned high profits in emerging markets such as China. The antitrust investigation will help regulate the industry and create a positive environment for new domestic automotive parts suppliers, they said.

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