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Samsung, the Benelux arm of the South Korean electronics company, was reportedly slapped with a hefty fine of $46.9 million or €40 million. Based on the reports, the penalty was imposed by the Authority for Consumers and Markets for price fixing in the Netherlands.
The Dutch competition regulator revealed about the fine on Wednesday, Sept. 29. It was learned that the price fixing issue is related to the prices of televisions in the said country.
According to Reuters, the Netherlands’ ACM said that for years, Samsung hiked up the prices of the TVs it sells in the country by urging local retailers to raise their prices. The Korean firm was said to have been persuading them to increase the price tags if they were selling televisions below Samsung’s preferred market price.
The ACM said that this action weakened the competition between seven of Netherland’s major online electronics stores. The regulator added that Samsung also told the retailers involved that their rivals will also observe its pricing policy, so this probably is one reason why they were convinced.
Moreover, the electronics company was also reported to have contacted the retailers if their rivals complained about the low prices of the televisions. This information was recorded on a document that was obtained by the ACM. “Samsung’s advice was not individual and not without consequences,” the Swiss regulator stated.
At any rate, Samsung Electronics Benelux denied the allegation that it pushed the retailers to use its preferred price. It said that it is disappointed with ACM’s decision to penalize them. The company said it never forced them, and they have always been free to decide and apply their own strategy for selling their products.
Finally, the Associated Press News reported that Samsung would file an appeal as it believes it did not violate any rules as alleged. Still, the Dutch watchdog said that the company should have known that its moves to influence the TV prices went far beyond the normal guidance. It said that the undue influence to the online retailers was damaging to a healthy competition atmosphere.
“Under the pretense of ‘price recommendations,’ Samsung made sure that retailers increased their prices to the market price that Samsung desired,” Martijn Snoep, ACM’s board chairman, said in a statement. “Samsung’s practices disrupted competition at the retail level, and resulted in higher prices for consumers.”
