A Dutch competition watchdog has concluded that Samsung violated a cartel prohibition by aligning sales prices of TVs across retailers between 2013 and 2018. Samsung has been fined €40 million.
Samsung TV price fixing
The Netherlands Authority for Consumers and Markets (ACM) said that Samsung monitored the sales prices of TVs and constantly urged retailers to raise their prices if they were selling TVs below market rate.
- "With this decision, ACM imposes Samsung Electronics Benelux B.V. fines of EUR 39,875,500 for aligning sales prices of Samsung televisions with various retailers. This coordination took place from January 2013 to December 2018. In doing so, Samsung violates the cartel prohibition under Article 6 Mw and Article 101 VWEU," the ruling reads.
Samsung used price comparison websites and web crawlers to monitor prices of all TV models across seven large retailers that account for the majority of Samsung TV sales in the Netherlands, according to ACM.
Samsung disputed the findings and maintained that it merely advised retailers of the suggested retail price. Samsung will appeal the fine.
- "We are disappointed with the ACM's decision as we believe that Samsung Electronics Benelux did not violate competition laws in the Dutch TV market as alleged by the ACM. We will take necessary legal actions to appeal the ACM's decision," Samsung said in a written statement to FlatpanelsHD.
ACM said Samsung's systematic approach went beyond that.
- "With this course of action, Samsung tried to prevent a downward price spiral. In doing so, it intervened in an unauthorized manner directly on the competition between the retailers. In the opinion of ACM, there is no commercial necessity or ground for this price coordination. Above all, the practice serves to preserve the margins of retailers and to protect the margins of Samsung itself. This behavior restricts competition and is prohibited," wrote ACM.
The South Korean electronics company communicated with retailers in various ways, i.e. through written text over email and Whatsapp. The ruling includes examples of Samsung's practices in the Netherlands:
Translated from Dutch to English:
Samsung requests a retailer to increase its online sales price for a television model to EUR 329. Samsung also informs the retailer that "all other partner parties have been advised". The retailer tells Samsung: "Done, visible in 15 minutes".
Email from Samsung to a retailer: “Hi [...],
Recommended price : Eur 999.00
all partners will be advised this week”.
A screenshot in the email shows that the retailer in question and some other retailers are now offering the model at an even lower price.
Retailer response: “Done, visible in 15 minutes”.
Samsung contacts a retailer about a television model and says: "[...] switching to 429 euros today.. can you follow this too?"
Samsung has this to follow: “Also more margin ”
A little later, Samsung announces that it is also contacting a third retailer: "[...] will of course receive the same advice".
Samsung then asks the first retailer: “Will this work?” Response: “has been edited”.
Samsung: “Great! ”.
The retailers went along with it but it was Samsung who played the central role in the coordination, said ACM. Retailers regularly complained to Samsung about TV prices set by competing retailers, prompting Samsung to approach the relevant parties.
Translated from Dutch to English:
A retailer sends Samsung an image showing that a competitor with a device is not at the desired price.
Samsung: “Pff. Go after it again”
Retailer: “Please. This really is a shame.”
Later that day, the Samsung account manager involved sends the request to fellow account holders: “Please urgently advise 1299 euros!”
A retailer raises the price of a television model to the level desired by Samsung and informs Samsung: "I still see a number of parties that are not switched to !"
Response from Samsung: “We have also seen, work is in progress!”
Samsung to retailer: “The price situation on the [...] is still not optimal… there is really no need to 'burn' money with the model. Would you like to watch this again? Advice sales Eur 799.00. Thanks in advance."
Retailer: “thanks for the tip”
Samsung: “You're welcome. Removing the crawler on this model would help a lot ;-) Of course we also advised the other parties.”
Samsung to retailer: “May I advise you again on a number of prices? As quickly as possible. . Please hold it until the weekend. A lot of them were already switched yesterday and the rest will follow as soon as possible. Thanks!”
Retailer Response: “Done”.