FTC hearings on PVC modifiers price-fixing

26 July 2004 00:01  [Source: ACN]

AN INVESTIGATION into the alleged violation of Japan’s anti-monopoly law by Mitsubishi Rayon, Kaneka Corp, and Kureha Chemical is still continuing and is expected to conclude in about a year, a source from the Fair Trade Commission’s (FTC’s) Special Investigation Department told ACN.

The source said the companies were informed on 11 December last year that the FTC had found that ‘Mitsubishi Rayon and Kaneka, jointly with Kureha Chemical’ had agreed, ‘on or around October 1999 and November 2000’, to raise the price of polyvinyl chloride (PVC) resin modifiers – methyl methacrylate butadiene styrene modifiers, acrylic modifiers, and processing aids – by Yen20-25/kg.

The case, he said, was part of a global crackdown against PVC resin-modifier producers by the FTC, the US Department of Justice, the Canadian Competition Bureau, and the European Commission.

As the companies had rejected the FTC’s ‘recommendation’ that they had violated the anti-monopoly law, the FTC had initiated hearings on the matter. But because the hearings were still continuing, the source said he could not provide any details about the case, such as the kind of penalty that the FTC would seek to impose on the three companies, if they were found guilty.

Sources from the companies declined to comment, saying only that they had given their views to the FTC and would continue to argue their case in the hearings.

An industry source said the FTC would probably seek to impose a heavier fine, under draft legislation drawn up recently by its chairman with the support of the country’s prime minister, than it had previously levied on price-fixing cartels. The current fine is a surcharge of 6% of a company’s sales during the period of collusion.

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