Insights | July 24, 2018

Commission fines Asus, Denon & Marantz, Philips and Pioneer for artificially maintaining high prices of their online distributors

In four separate decisions the European Commission (“Commssion”) today fined consumer electronics manufacturers of, amongst others, kitchen appliances, computers, headphones and hair dryers for imposing fixed or minimum resale prices on their online retailers. The fines amounting to more than EUR 111 million in total were all reduced due to the companies’ cooperation with the Commission.

All four manufacturers had adopted a practice of monitoring and tracking the sales prices applied by their distributors and intervening in cases where they noted that recommended prices were not being followed. Interventions took place in the form of threats and sanctions as well as refusal to supply.

Asus, headquartered in Taiwan, was fined EUR 63, 5 million and received a reduction of 40% based on its cooperation with the Commission. Asus monitored the resale price of retailers for certain computer hardware and electronics products such as notebooks and displays. The conduct of Asus related to the German and French markets and took place 2011 – 2014.

Denon & Marantz, headquartered in Japan, was fined EUR 7,7 million and granted a 40 % reduction. Denon & Marantz engaged in resale price maintenance with respect to audio and video consumer products such as headphones and speakers of the brands Denon, Marantz and Boston Acoustics in Germany and the Netherlands in 2011 – 2015.

Philips, headquartered in the Netherlands, was fined EUR 29,8 million and benefitted from a reduction of 40 %. Philips engaged in resale price maintenance in France between the end of 2011 and 2013 with respect to a range of consumer electronics products such as kitchen appliances, coffee machines, vacuum cleaners, home cinema and home video systems, electric toothbrushes, hair driers and trimmers.

Pioneer, headquartered in Japan, was fined EUR 10,1 million and received a 50% reduction. In parallel to resale price maintenance with respect to products such as home theatre products, iPod speakers, speaker sets and hi-fi products, Pioneer, also limited the ability of its retailers to sell-cross border to consumers in other Member States in order to sustain different resale prices in different Member States, for example by blocking orders of retailers who sold cross-border. Pioneer’s conduct lasted from the beginning of 2011 to the end of 2013 and concerned 12 countries (Germany, France, Italy, the United Kingdom, Spain, Portugal, Sweden, Finland, Denmark, Belgium, the Netherlands and Norway).

These (and the earlier reported) investigations follow the Commission’s extensive e-commerce sector inquiry which resulted in a final report adopted on 10 May 2017 and form part of the Commission’s broader Digital Single Market strategy.

Source: Commission press release 24 July 2018