Record $30M Fine Obtained by Competition Bureau Against Japanese Auto Parts
OTTAWA, ONTARIO -- (Marketwired) -- 04/18/13 -- Following an
investigation by the Competition Bureau, a Japanese supplier of motor
vehicle components was fined $30 million by the Ontario Superior
Court of Justice for its participation in a bid-rigging conspiracy.
This fine is the largest ever ordered by a court in Canada for a
Yazaki Corporation (Yazaki) pleaded guilty to bid-rigging under the
Competition Act for its participation in an international cartel with
other Japanese suppliers of motor vehicle components. This is the
second guilty plea in the largest bid-rigging investigation ever
undertaken by the Bureau.
The evidence shows that Yazaki secretly conspired with other Japanese
motor vehicle components manufacturers to submit bids or tenders in
response to requests for quotations to supply Honda of Canada
Manufacturing Inc. (Honda) and Toyota Motor Manufacturing Canada Inc.
(Toyota) with motor vehicle components.
"Cartelists must be penalized for defrauding Canadians," said John
Pecman, Interim Commissioner of Competition. "The record fine in this
matter underscores the seriousness of bid-rigging offences and sends
a strong message that companies need to comply with the law."
Yazaki's plea relates to wire harnesses supplied to Honda and Toyota
for the 2005.5 Honda Ridgeline, 2006 Honda Civic and 2006 Toyota
Yazaki's total volume of commerce in Canada, affected by the
bid-rigging conspiracy, was approximately US$260 million.
With Canada representing Toyota's seventh-largest global sales
market, approximately 50 per cent of the products it sells in this
country are made in Ontario. As an example, over 800,000
Corollas/Matrix were produced in Canada from 2006 through 2009 and
assembled in Ontario. Nearly all Civics sold in Canada, with the
exception of the Civic Hybrid, are built in Ontario.
"Bid-rigging has a negative impact on the Canadian economy," said
Matthew Boswell, Acting Senior Deputy Commissioner of Competition.
"In this case, our investigation determined that Honda and Toyota
were denied the economic benefits of a competitive bidding process
with respect to the wire harnesses used in some of the most popular
cars sold in Canada."
On April 4, 2013, Furukawa was fined $5 million for rigging bids for
electrical boxes, such as fuse boxes, relay boxes and junction
blocks, sold to Honda between 2000 and 2010, for the 2001 and 2006
Honda Civic models.
The Bureau's investigation relates only to motor vehicle components
manufacturers. There is no allegation of wrongdoing against motor
vehicle manufacturers, such as Toyota and Honda, the customers of the
companies under investigation.
The Bureau became aware of the motor vehicle components cartel by way
of its Immunity Program. The investigation also benefitted from the
cooperation of numerous companies under the Bureau's Leniency
Program. Yazaki and Furukawa both participated in the Bureau's
Leniency Program and provided substantial assistance to the Bureau
and the Public Prosecution Service of Canada. The two companies'
cooperation has saved considerable costs associated with the
investigation and prosecution.
The Bureau's ongoing investigation is being coordinated with a number
of other jurisdictions, including the United States, Japan, the
European Union and Australia.
The Competition Bureau, as an independent law enforcement agency,
ensures that Canadian businesses and consumers prosper in a
competitive and innovative marketplace.
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