China: three cement firms fined for price fixing

China: three cement firms fined for price fixing

Jilin Yatai Group Cement Sales Co Ltd (Yatai), North Cement Co Ltd and (North) and Jidong Cement Jilin LLC (Jidong) were handed out fines for price fixing after China's National Development and Reform Commission (NDRC) instructed the Jilin Province Price Bureau to impose financial penalties totalling CNY114m (US$19m) following alleged breaches of the Anti-Monopoly Law (AML) by the companies involved.

The NDRC found that in April 2011, the three cement producers met and agreed to coordinate pricing on cement products in areas of Northeast China. The investigation also found that in May 2011, North and Yatai struck price agreements on cement products in areas within Jilin province. These actions were judged as restrictive to market competition and of causing harm to the interests of downstream industries and customers.

However, there was overcapacity in the cement sector around the time the agreements were made, so the three companies’ pricing agreements did not last long and the anticompetitive effect only applied to limited areas. The NDRC fined Yatai and Jidong two per cent of their sales revenue in 2012. This amounted to approximately CNY60m (US$10m) for Yatai and CNY13m (US$2m) for Jidong. The NDRC fined North Cement one per cent of its 2012 sales revenue, or approximately CNY41m (US$7m).