The European Commission has decided to open formal proceedings against Nintendo and seven other companies that distribute Nintendo products. It has sent a statement of objections to Nintendo Co itself, Linea GIG S.p.A., Itochu Corporation, Concentra L.DA, Bergsala AB, Nortec SA, CD-Contact Data GmbH and John Menzies Plc.
The Commission stated that the companies concerned participated in a cartel-like arrangement with the aim of partitioning the European single market, in breach of Article 81 EC. The companies are accused of having artificially kept prices higher and of having divided up the market for Nintendo game-consoles and video games by restricting parallel trade. The companies are given two months to prepare a written reply in their defence.
According to the information available, each company was given a national territory within the European Union in which to distribute Nintendo products and was under an obligation to prevent parallel trade, that is exports from one country to another via unofficial channels, primarily by imposing export bans and controls on their retail and wholesale customers. The information shows companies collaborated intensively to find the source of any parallel trade. Companies that allowed parallel trade to occur from their countries were sanctioned.
The Commission is also accusing Nintendo of making it more difficult for retailers to engage in price competition. The investigation showed price differences were frequent and large (sometimes double from one EU country to another).
The investigation into Nintendo distribution practices started in 1995. According to the Commission, the infringements continued despite the fact that Nintendo and some of the other companies knew of the investigation. Eventually, the investigation was speeded up when one of the companies started to co-operate with the Commission and provided essential evidence.
The present proceedings follow on from a long and larger scale investigation that started in 1995. Initially, this investigation focused primarily on the policies of Nintendo and other manufacturers of game-consoles, Sony and Sega, for licensing to video-game developers to produce games for those game-consoles. In 1996, formal proceedings were opened and statements of objections regarding the licensing policies were issued. As a result, Sega, Nintendo and Sony changed their licensing policies. (IP/00/419)
(See also earlier press releases IP/97/676 of 22/07/1997 and IP/97/757 of 14/08/97)
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