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Brussels accuses chip makers of collusion

Smart card silicon market under investigation

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A five-year investigation in Europe into collusion into the smart card market is heating up, with the European Commission issuing a 90-page “statement of objections” to big-name vendors including Philips and Infineon.

The European Commission complaint centres around the silicon used for SIMs, chipped passports, bank cards and other “smart card” devices. While the EC didn't name the companies involved, Reuters reports that Philips and Infineon have acknowledged receiving letters from the Commission.

The agency raided a number of companies in 2008 on the basis that it believed vendors in the market were allocating customers, exchanging commercially sensitive information and fixing prices. The accusations date back to 2003/2004. Since then, according to Reuters, talks with the companies to settle the case have broken down, leading to the charge.

Bloomberg also names STMicroelectronics, Atmel, NXP Microelectronics, Renesas and Samsung as being involved in the probe.

STMicroelectronics and Atmel were raided in 2008, but say they have yet to receive the Commission's “statement of objections”. NXP was spun off out of Philips and is Europe's largest chip maker, but the commission says it will not be issuing a statement of objections against that entity.

If the EC's accusations are proven, companies involved could be fined as much as 10 per cent of their global revenue. ®

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