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Furukawa fined $5-million in Ontario over auto-parts bid-rigging

Furukawa fined $5-million in Ontario over auto-parts bid-rigging

christine balderas/iStockphoto

The Ontario Superior Court has fined Japanese auto parts maker Furukawa Electric Co. Ltd. $5-million on charges related to an international bid-rigging scheme.

The federal Competition Bureau said Thursday that the fine is the largest ever by a Canadian court for bid-rigging under the Competition Act.

It arises from an investigation by the bureau into allegations that Furukawa and other Japanese manufacturers conspired on bids or tenders to supply motor vehicle components to Honda of Canada Manufacturing Inc.

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"Cracking down on cartels, including bid-rigging offences, is a top priority for the bureau," said John Pecman, interim commissioner of competition.

"This criminal activity defrauded the automobile sector in Canada and the substantial fine demonstrates the seriousness of such an offence."

Furukawa's plea relates to electrical boxes, including fuse boxes, relay boxes and junction blocks, sold to Honda between 2000 and 2010 for Honda Civic models. The total volume of commerce in Canada affected by the bid-rigging conspiracy was approximately $41-million.

The bureau said its ongoing investigation related only to manufacturers of motor vehicle components and there was no allegation of wrongdoing against vehicle manufacturers, including Honda.

The probe is the Competition Bureau's largest to date with respect to bid-rigging and is being co-ordinated with a number of other jurisdictions, including the United States, Japan, the European Community and Australia.

The bureau said it became aware of the cartel through an immunity program under which Furukawa provided "substantial assistance."

"The company's co-operation has saved considerable costs associated with the investigation and prosecution," the bureau said.

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