CADE convicts NHK Spring and five individuals for cartel practice

On 17 September, the Tribunal of the Administrative Council for Economic Defense (CADE) convicted NHK Spring Co. Ltd and five individuals for cartel practice in the global market of HDD suspensions, which also impacted the Brazilian market. A suspension assembly is a component of hard drives (HDDs), responsible for positioning the write head on a rapidly spinning disk. 

The case was launched in 2018, after the signature of a Leniency Agreement to investigate the anticompetitive conducts that took place between 2003 and 2016.  

Commissioner Victor Oliveira Fernandes, rapporteur of the case, highlighted the strong evidence for the practices that consisted of price fixing, market allocation, and exchange of competitively sensitive information. 

Regarding the effects of the cartel in Brazil, Mr Fernandes stressed the potential effects of the import of suspension assemblies by manufacturers of HDD based in Brazil during the period of the violation. Even if there were no direct impacts, the potential negative effects of the international cartel could be proven by the indirect impacts in the final importation of end products into Brazil, since the Brazilian market is essential to imported HDDs, either as components (of laptops, for example) or as end products. 

In addition, the rapporteur stated that the evidence originated from the Leniency Agreement goes beyond the testimonies from the beneficiaries. The body of evidence includes a large collection of emails and messages exchanged among competitors, beyond internal communications, and showing horizontal systematic coordination.  

Thus, the council unanimously decided to fine NHK Spring Co. Ltd in BRL 4.4 million. The five individuals are to pay BRL 330.4 thousand. 

Access Case no. 08700.006006/2017-61.