FTC to probe collusion in several markets

By Ted Chen ,The China Post

TAIPEI, Taiwan — Following announcements by leading telecom carriers that subscription contracts for unlimited and unthrottled 4G plans will continue to be offered past the original deadline of Oct. 31, Fair Trade Commission Chairman Wu Shiow-ming (�d�q��) yesterday stated that the regulator will be continuing efforts to detect collusion in the sector.

According to Wu, carriers stand a far better chance of avoiding collusion charges by maintaining the current status quo, namely, by extending the availability of unlimited data usage contracts.

Wu warned that further probes to verify collusion activities will be launched should telecom carriers elect to collectively cease unlimited 4G offers at similar time frames.

��The extension of unlimited 4G subscription plans by carriers is tantamount to delaying tactics aimed at maintaining the status quo,�� said Wu, adding that the move will not affect competition in the market, and is unlikely to cause collusion infractions. Wu also noted that carriers’ decisions to extend unlimited 4G plans prove the effectiveness of government intervention.

Chunghua Telecom announced earlier that the company will extend its unlimited 4G plans in the meantime while new pricing schemes are devised with rivaling carriers such as Far EasTone (����) and Taiwan Mobile (�x�W�j) following suit shortly after.

In addition, We noted that investigations are still ongoing over collusion in the telecom sector over similar pricing for the highly sought after iPhone 6 handsets.

FTC Suspects Collusion in Baby Formula Price Hike Meanwhile, the FTC yesterday also noted that it will be investigating the second wave of price hikes from baby formula makers to hit the Taiwan market. Snow Brand Milk Products (���L), which commands the highest market share in the Taiwan market, announced that six of its most popular baby formula products will see their prices hiked by about NT$60, representing an increase of 5.1 percent.

Quaker-brand baby formula, distributed by Standard Foods Co. (�ή�), will be raising the price of three of its products by between NT$60 and NT$80, representing an increase of about 9.5 percent.

Wu noted that while these facts alone do not clearly point toward collusion, their irregularity warrants the launching of investigations. Wu pointed out that as Snow Brand imports milk ingredients from Australia as opposed to Japan, the decline of the yen should not have tangible impacts on the company. As a result, an investigation will be launched to verify the reasons behind the price hike.

According to Wu, collusion is punishable by fines of NT$25 million, with more heinous offenders subject to fines equivalent to 10 percent of revenues recorded in the previous fiscal year.

Despite price hikes in the Taiwan market, the price for a metric ton of powdered whole milk has fallen from about the US$4,900 recorded early this year to US$2,500, raising doubts about the legitimacy of price hikes initiated by Taiwan-based baby formula makers.