The EU on Tuesday fined Asustek Computer Inc (華碩) for anti-competitive practices, but said the fine was reduced by 40 percent because the company cooperated with an investigation.
The EU announced that it was fining four companies, including Asustek, a combined 111 million euros (US$129.9 million) for imposing fixed or minimum resale prices on online retailers.
Asustek was fined 63.5 million euros, while Dutch-based Koninklijke Philips NV and Japan’s Pioneer Corp and Denon & Marantz were fined 29.8 million euros, 10.2 million euros and 7.7 million euros respectively.
The four had their fines reduced by 40 to 50 percent depending on their level of cooperation with the investigation, the EU said.
Asustek said it assigned a provision of 65 million euros in the first quarter to cover the anticipated fine from the EU.
The provision resulted in a nonoperating loss of NT$760 million (US$24.81 million) for Asustek in the first quarter, dragging first-quarter net profit to NT$2.38 billion, which was down 35 percent from a year earlier.
The company also said it would abide by EU rules when it markets and sells its products in member nations and would also strengthen employee training to avoid anti-competitive practices.
Asustek and the other three companies engaged in “fixed or minimum resale price maintenance,” in effect demanding that online retailers keep prices for their products above a certain level or face threats or sanctions, such as cutting off supply, the EU said.
Asustek intervened with retailers in Germany and France from 2011 to 2014, when they resold products at prices less than those recommended by Asustek, the EU said.
As online retailers use pricing algorithms that automatically adapt retail prices to those of competitors, restrictions on low-price online retailers “typically had a broader impact on overall online prices for consumer electronics products,” the EU said.
“As a result of the actions taken by these four companies, millions of European consumers faced higher prices for kitchen appliances, hair dryers, notebook computers, headphones and many other products. This is illegal under EU anti-trust rules,” European Commissioner for Competition Margrethe Vestager said in a statement.
RETAIL BANKING EXIT: Clients are concerned whether their rights would be protected, while employees were caught by surprise as the bank had just upgraded its services Citibank Taiwan Ltd (花旗台灣) yesterday said that credit card clients could continue using their cards as operations would continue normally until it sells its consumer banking business. As of February, the bank had 2.86 million credit cards in circulation in Taiwan, of which 2.17 million had been used in the past six months, ranking it sixth among all banks, data from the Financial Supervisory Commission showed. Credit card spending by Citibank clients totaled NT$15.66 billion (US$552.6 million) in February, also ranking sixth among banks in Taiwan. Citibank was the only foreign bank that made it into the top six. Customers should not
FUTURE GROWTH: TSMC chief executive officer C.C. Wei said customer demand for 3 and 5-nanometer technologies is so strong that it needs to spend on more capacity Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday raised this year’s capital expenditure to a record US$30 billion, as demand for advanced chips used in high-performance-computing (HPC) applications is stronger than last quarter. The figure surpasses the chipmaker’s allocation in January of US$25 billion to US$28 billion. The investment is part of a three-year US$100 billion capital expansion plan that TSMC unveiled earlier this month. “As we enter a period of higher growth, underpinned by the multiple years of structural mega-trends of 5G-related and HPC applications, we believe a higher level of capital investment is necessary to capture the future growth opportunities,” TSMC
PANDEMIC EFFECT: Chromebook shipments in the first quarter more than tripled from a year earlier, driven primarily by educational institutions in North America Despite a semiconductor shortage, global PC shipments in the first quarter of this year increased 32 percent from a year earlier, preliminary data from research firm Gartner Inc showed. Shipments in the January-to-March period totaled 69.87 million units from 52.93 million units a year earlier, Gartner said in a report on Monday last week. The quarterly increase in shipments marked the fastest annual growth since it began tracking the PC market in 2000, Gartner said. “This growth should be viewed in the context of two unique factors: comparisons against a pandemic-constrained market and the current global semiconductor shortage,” Gartner research director Mikako Kitagawa
UNWINDING BIGGEST DEAL: Five years ago, Dell acquired VMware’s parent, EMC Corp, for US$67 billion, which helped the PC maker to branch out from its origins Dell Technologies Inc on Wednesday said that it would spin off its stake in VMware Inc, creating two publicly traded companies and raising cash to pay down debt. Its shares jumped on the announcement. The spinoff would unwind, at least in part, a consolidation created five years ago in Dell’s US$67 billion acquisition of VMware’s parent, EMC Corp. The spending spree helped Dell branch out from its origins as a PC maker, but left the company saddled with debt. VMware would distribute a special cash dividend of US$11.5 billion to US$12 billion to shareholders at the close of the deal, which is