Breaking News, World News and Taiwan News.

Updated Monday, September 6, 2010 12:01 am TWN, By Benjamin Chiang

Sponsors
▪	Save 75% for all hotels in Shanghai, Beijing and whole China. Lowest rates for Flights in China.
▪	Get the best deals for Guangzhou Hotels or choose from more than 10,000 hotels in 499 Chinese cities.
▪	Find great real time deals on China Flights. Book flights to China or China domestic flights 24/7.
▪	Buy china wholesale products from reliable chinese wholesalers on DHgate.com!

AUO's legal woes bring an antitrust cloud that hangs over IT industry

Taiwanese enterprises have aggressively expanding around the world, but still rarely understand the laws and regulations they face in their new countries of business. They tend to believe, “I've done it, but nobody will know.” What they do not realize is that when they do act illegally, a trace is unavoidably left behind.

“Standing on the wrong side of the law, gambling that they won't catch me” is the typical cavalier attitude of Taiwanese businesses overseas, Huang observes. In their minds, he says, violations of antitrust laws do not seem to be serious.

Taiwanese companies have not begun breaking laws in foreign countries only recently. When they first began moving offshore, they often violated local labor regulations, which then extended to tax evasion and problems with corporate governance. In the past three years, the United States and Europe have begun to strictly probe the commercial practices of Asian companies. Conspiring to set monopolistic prices has been the land mine that has rattled Asian enterprises the most, with Samsung Electronics, Chi Mei Optoelectronics, Chunghwa Picture Tubes Ltd., and AUO all suffering severe blows.

“As long as an industry is an oligopoly, there is a temptation to engage in price fixing,” observes an analyst at a foreign securities firm in Taipei. With fewer than 10 large flat panel makers around the world all sharing pricing information, they were able to manipulate and jointly fix the sales prices of flat panels.

In addition, Taiwan's government does not strictly enforce the Fair Trade Act. It focuses mainly on investigating false advertising cases and rarely addresses acts of collective price-fixing, spawning an attitude among Taiwanese companies that they can get away with anything.

The antitrust cases that have taken a toll on Chunghwa Picture Tubes, Chi Mei Optoelectronics, and AUO are reminders to Taiwanese companies operating in any sector in which Taiwan enjoys worldwide prominence that “you are no longer the small company of old,” says Jones Day's Huang. “If you want to be a big, global company, you must first obey the laws of each country.”

Translated from the Chinese by Luke Sabatier.

1|2|3