Insurance firms fined $18M for price monopoly
02 September 2014, 15:50
Shanghai - A total of 23 Chinese insurance firms have colluded to fix fees, authorities said Tuesday, slapping them with a total of $18 million in fines in the government's latest anti-monopoly move.
The companies negotiated and agreed on unified commissions from auto insurance premiums through meetings organised by industry group the Zhejiang Insurance Association, the National Development and Reform Commission (NDRC) said in a statement.
The government agency fined 22 of the insurers a combined 110 million yuan ($18 million), the statement said, with one company escaping punishment for informing authorities and providing evidence.
The penalised firms included some of the biggest names in Chinese insurance, such as branches of China Life and Ping An.
The industry group, held primarily responsible for the violations, was also fined 500,000 yuan, the NDRC said.
The penalties came against the backdrop of a wide-ranging government crackdown on alleged malpractice by foreign firms across a range of sectors, including pharmaceuticals, baby formula and technology.
The insurers are nearly all fully Chinese-owned, but US-based Starr Insurance & Reinsurance has a majority stake in Dazhong Insurance while France's AXA has half of AXA Tianping.
Authorities in late August fined 10 Japanese auto parts firms more than $200 million in total for price-fixing, reportedly the biggest-ever penalty since China's anti-monopoly law took effect in 2008.
US software giant Microsoft and mobile chip maker Qualcomm are also under investigation for alleged "monopoly" actions.
A Chinese official has denied foreign companies are being targeted, calling such claims "groundless and baseless".
"Some of the NDRC monopoly investigations involve overseas multi-nationals, but that does not mean we are targeting them," Xu Kunlin, head of the agency's anti-monopoly bureau, said in an interview published on Tuesday.
"We will investigate domestic or foreign companies if they are in alleged violation of China's anti-trust law without any discrimination," he told the China Daily newspaper.