Anti-monopoly law should serve consumers' interests

China should give more consideration to its customers while fighting monopolies, says an editorial in Beijing News Daily. Excerpts:

Samsung, LG Display and four Taiwan companies were ordered by the National Development and Reform Commission to repay a total of 172 million yuan ($27.6 million) to mainland TV makers, had 36.75 million yuan confiscated, and were fined 144 million yuan for fixing the prices of flat-panel screens sold to mainland manufacturers.

The six companies used their monopoly status to set prices from 2001 to 2006, reaping a combined 208 million yuan in illegitimate profits from the sale of about 5.14 million screens. The NDRC's ruling follows similar rulings by the US, South Korea and the European Union on flat-panel screen price-fixing by these Asian companies between 2001 and 2006.

Although the fine from China is only about 5 percent of its Western counterparts, this action still has a symbolic meaning for the country, considering the lackluster enforcement of its anti-monopoly laws.

The authority should not be blinded to the fact that monopoly-based profits are made all the way through manufacturing and marketing chains to customers. China has strengthened its anti-corruption law enforcement not to follow international practices, but to punish wrongdoers to protect the consumers' legal interests.

Except for extending TV manufacturers' free warranties from 18 to 36 months, the NDRC ruling does not mention any specific compensation measures related to or for the average Chinese consumers.

It was necessary for Chinese TV manufacturers to get the indemnities. But the consumers should not be left out. The EU and the US both reached reconciliation-fund agreements with screen giants like Sharp Corp and Samsung Group. The fund provided by these firms will be directly used to compensate for the unfair loss of consumers.

Chinese authorities and law enforcement agencies must be aware that the anti-monopoly law relates not only to manufacturers, but the average customers as well.