Japan Orders Tire Cartel To Break Up, Fines Japanese Firm

Tokyo, Japan (AHN) - Japan's anti-monopoly watchdog will fine a local rubber conglomerate for joining four foreign firms in the price-fixing of marine hoses and will order the cartel to break up.

The Daily Yomiuri Online quoted unnamed sources as saying that the Fair Trade Commission (FTC) plans to fine Japan's Bridgestone Corp. in the amount equivalent to a percentage of its profits from rigged biddings for marine hose supplies to U.S. bases in Okinawa, Japan since 2004.

The commission will also order Britain's Dunlop Oil & Marine Ltd., France's Trelleborg Industrial AVS, and Italy's Parker ITR S.R.L. SpA and Manuli Rubber Industries SpA to break up their cartel.

Punishment for a sixth tire firm, Tokyo-based Yokohama Rubber Co., is yet to be decided. The firm provided information on the cartel.

The breakup of the cartel will be the FTC's first administrative punishment on foreign firms.

The FTC found that the six companies rigged the bidding for marine hoses used at oil storage facilities in Japan, U.S. bases in Okinawa Prefecture and in Abu Dhabi, United Arab Emirates. The scheme allowed either Bridgestone or Yokohama to win all the bids for products to be used in Japan.

The same scheme was applied for the foreign firms to win bids in their respective countries. The firms also prearranged the winning bidder among themselves for supply contracts in other countries, including the U.S.

The investigation started in May found that officials of the firms had been meeting since 1999 in Britain, Thailand and the U.S.

The international market for marine hoses is estimated at $90 million per year. The six firm control 90 percent of the market, with Bridgestone having the biggest share of 30 percent.