Brussels, 28/04/2000 (Agence Europe) - On Friday, the European Commission announced that it was initiating an investigation into the actions of the Japanese firm Nintendo CO and seven other firms distributing its products. It has warned them that their way of dividing up the market for Nintendo game-consoles and video games appears to be in breach of the European anti-trust rules by artificially keeping high prices. It suspects them of participating in a cartel with the aim of sharing national territories. Commissioner Mario Monti, responsible for competition, declared that "European families spend millions every year on video games and we want to ensure that they are not being swindled".
The distribution firms concerned are Linea GIG S.p.a., Itochu Corporation L.D.A., Bergsala AB, Nortec SA, CD-CONTACT Data GmbH and John Menzies Plc.. In 1997, Nintendo alone sold 46 million static SNES consoles for which consumers bought 359 million game-cartridges. The Commission has sent them a statement of objections setting out the patterns of conduct that it believes to be illegal. A note from the press services sets out the Commission's complaints:
"According to the information available, each company was given a national territory within the European Union to distribute Nintendo products and was under the obligation to prevent parallel trade, i.e, 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 from their countries to occur were sanctioned.
The Commission is also accusing Nintendo of making it more difficult for retailers to engage in price competition".
The companies have two months to respond to the statement of objections.
The spokesperson also recalls that the Commission had begun an investigation in 1995 in the field of games consoles. In an initial phase, it had disputed the practices of three console manufacturers, Sony, Sega and Nintendo, regarding their policy towards companies wanting to produce games for their consoles. Following a statement of objections, the three companies altered their authorisation policy regarding rival games. The current complaints against Nintendo regard the distribution of these products.