Japanese auto parts company fined $13 million for participating in a bid-rigging conspiracy

Ninth guilty plea resulting in second largest fine for bid-rigging offence

OTTAWA, April 1, 2016 /CNW/ - Showa Corporation (Showa), a Japanese manufacturer and supplier of automobile components, has pleaded guilty to one count of bid-rigging for participating in an international conspiracy and was fined $13 million by the Ontario Superior Court of Justice.

This is the second largest fine ever ordered by a court in Canada for a bid-rigging offence. To reduce the likelihood of a subsequent offence being committed, Showa implemented a competition compliance program.

The Competition Bureau's investigation found that between October 1, 2007 and April 30, 2008, Showa engaged in secret illegal arrangement with another supplier of electric power steering (EPS) gears sold to Honda Motor Co., Ltd. for cars manufactured in Canada.

Since April 2013, the Bureau's investigation involving motor vehicle components has resulted in nine guilty pleas and over $70 million in fines imposed by the courts.

Quick Facts

• EPS gears use an electric motor and an electronic control unit to provide additional power to the steering mechanism.
• The Bureau first learned of cartel activity in the motor vehicle components industry by way of its Immunity Program, after which it began investigating in December 2009. The investigation also benefitted from the cooperation of numerous companies under the Leniency Program, in which Showa participated.
• The Bureau's investigation relates to a series of alleged conspiracies and bid-rigging agreements or arrangements among various suppliers in the sale and supply of components used in the manufacturing of motor vehicles in Canada and elsewhere.
• Cracking down on cartels is a top enforcement priority for the Bureau, which vigorously pursues those who participate in cartel activity.

Quotes

"Bid-rigging leads to higher prices for consumers, reduces the incentive for companies to be innovative and creates a less competitive environment. It is toxic behaviour that harms the economy and consumers, in Canada and around the world, which is why the Bureau is cracking down on these anti-competitive agreements."

Stéphane Hould
Deputy Commissioner of Competition

Related Information

• Backgrounder: Overview of the automobile component bid-rigging conspiracy investigation [Add hyperlink]
• Immunity Program
• Leniency Program
• Videos on cartels and bid-rigging

Associated Links

• On December 9, 2015, Toyo Tire was fined $1.7 million for rigging bids for anti‑vibration components.
• On December 11, 2014, Yamashita Rubber Co. was fined $4.5 million for rigging bids for anti-vibration components and systems.
• On August 20, 2014, DENSO Corporation was fined $2.45 million for rigging bids for body electronic control units.
• On February 20, 2014, Panasonic Corporation was fined $4.7 million for rigging bids for certain types of switches and sensors.
• On January 30, 2014, NSK Ltd. was fined $4.5 million for rigging bids for automotive wheel hub unit bearings.
• On July 12, 2013, JTEKT Corporation was fined $5 million for rigging bids for automotive wheel hub unit bearings.
• On April 18, 2013, Yazaki Corporation was fined $30 million for rigging bids for wire harnesses.
• On April 4, 2013, Furukawa Electric Co., Ltd. was fined $5 million for rigging bids for electrical boxes.

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SOURCE Competition Bureau

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