Sharp and Nintendo are under investigation for price fixing. Investigators from the Japanese Fair Trade Commission (JFTC) have raided the offices of both Companies seeking documents and emails that would give them evidence that Nintendo and Sharp conspired to fix the price of Nintendo DS handheld games.
According to The Times, the raids are thought to be a direct result of Japan’s recently enacted “whistle-blower law”, a significant legal change pushed through by the JFTC that grants amnesty to the first corporation within a price-fixing cartel to own up.
The raids on Sharp and Hitachi centre on allegations that the two Companies conspired to fix the price of the liquid crystal screens on the Nintendo DS which has sold more than 65 million units since its launch.
The Times go on to say that When the DS was released in 2004, Sharp met 100 per cent of supply. A year later, as Nintendo struggled to meet soaring worldwide demand, Hitachi joined as a supplier of LCD panels.
It is at that point that the alleged price-fixing began, according to sources close to the investigation. Sharp and Hitachi are thought to have reached an agreement that panel prices would remain stable, despite obvious competition between the two suppliers and the overall downward pressure on LCD panel prices.
It is not the first time that Sharp and Hitachi have been under investigation for price fixing. Both US and European investigators have probed these Companies in relation to the price fixing of consumer technology products.The two companies were investigated in relation to the price-fixing of LCD TV panels in 2006. These screens were used in both PC’s and LCD TV’s.