Taiwan Today

Taiwan’s Chi Mei Optoelectronics Corp. announced Dec. 10 that it has entered into a plea agreement with the United States Department of Justice regarding anticompetitive activities in the United States. Under the terms of the agreement, CMO will pay a fine of US$220 million in installments over a period of five years, and cooperate with the DOJ’s on-going investigations. The company will record the full amount as a non-operating expense in the fourth quarter of the fiscal year 2009. Starting from the end of 2006, the U.S. DOJ launched a series of investigations on several thin-film-transistor liquid-crystal-display panel manufacturers in Japan, South Korea and Taiwan regarding alleged price-fixing activities between 2001 and 2006. Those found guilty were ordered to pay fines according to the number and scale of their offenses, sources familiar with the issue said. The fine imposed on CMO is lower than that which has been imposed on South Korea’s LG Display Co. Ltd., they added. According to market analysts, CMO has posted losses of NT$23.2 billion (US$718 million) for the first three quarters of the year, and could see the number escalate to NT$30 billion for the entire year with the plea agreement. The analysts are also keeping a close eye on Taiwan’s AU Optronics Corp. and South Korea’s Samsung Electronics Co. Ltd. Both firms, they predict, will have to pay fines of more than US$220 million each. The longer the lawsuits are pending, the higher the risks AUO and Samsung will face, they pointed out. In related news, the tri-party merger of CMO, Innolux Display Corp. and TPO Displays Corp. is progressing full steam ahead. The new entity, Chimei Innolux Corp., will become the largest panel maker of Taiwan. Innolux executives pointed out that the company had been informed of the lawsuit during the first round of merger negotiations with CMO, and that the merger would proceed as scheduled, with March 1 as the effective date. CMO officials said that the company had already discussed the case with Innolux, and that the amount of the fine is within the firm’s predictions. They explained that the merger deal was completed with full disclosure of all relevant information, and that Innolux is fully aware of the situation. (SFC-HZW)