Philips, Samsung and Infineon fined over smartcard-chip cartel

The European Commission (EC) has fined Infineon, Philips and Samsung for setting up a smartcard-chip cartel.

Infineon, Philips and Samsung were fined €82.78m, €20.15m and €35.11m, respectively. Samsung received a reduction of 30% of its fine for cooperating with the investigation. Philips has since divested its smartcard chips business but “remains liable for what happened during the period of the infringement”.

Renesas, and its joint-venture parent companies Hitachi and Mitsubishi, received full immunity for revealing the existence of the cartel to EC, avoiding a fine of more than €51 million.

The companies discussed and exchanged sensitive commercial information on pricing, customers, contract negotiations, production capacity or capacity utilisation and their future market conduct. 

“Such contacts were clearly anticompetitive since they reduced uncertainty concerning each other’s behaviour on the market,” said European Commission Vice-President iJoaquín Almuni.

“The cartelists must have known that their conduct was illegal. Some of them even took measures to conceal the collusion. But the cartel was ultimately discovered and punished.”

The commission had initially explored the possibility of settling this case with some of the companies involved under the commission’s 2008 Settlement Notice. However, in 2012 the commission decided to discontinue the settlement discussions and to revert to the normal procedure because of the clear lack of progress of these discussions.

“In this digital era, smartcard chips are used by almost everybody, whether in their mobile phones, bank cards or passports,” said Almunia. “It is crucial that the companies producing them focus their efforts on how to outperform their competitors by innovating and providing the best products at the most attractive prices. If, instead, companies choose to collude, at the expense of both customers and end consumers, they should expect sanctions.”