Illegally high prices not fair game

COMPUTER games company Nintendo has been fined almost €150 million for selling games and console machines at illegally high prices across Europe.

The Japanese company was before the European Commission yesterday for price fixing and inflating prices in some countries by as much as 65%.

Nintendo's official distributor in Ireland John Menzies was also fined in the hard-hitting judgement handed down by the EU competition authority.

The company and seven of its European distributors were fined a total of 167.8 million for keeping prices in some European markets high by illegally limiting cross-border sales during the 1990s.

The fine on Nintendo, makers of such popular games as Super Mario, was the fourth largest ever handed down by the EU authorities on a company for a single offence.

The commission said the heavy fine reflected Nintendo's size in the market and its role as the "driving force behind the illicit behaviour".

The commission said the company prevented distributors selling its goods from cheaper EU countries, such as Britain, to those like Germany and the Netherlands where products were 65% more expensive. The commission said Nintendo and the distributors collaborated to block traders who made price-cutting cross-border sales.

These traders were punished by being given smaller shipments or by being boycotted altogether.

The collusion continued from 1991 to 1998, even after Nintendo knew it was under investigation.

Irish and British prices were the lowest and this tempted outside traders into re-exporting cheap goods into high-price markets.

The most striking price differences were spotted early in 1996 when certain Nintendo games and products were up to 65% cheaper here and in Britain than in the Netherlands and Germany.

At one point Nintendo goods on the Spanish market were 67% more expensive than here and in Britain. John Menzies distributors yesterday hit out at the scale of the fine, calling it "totally disproportionate".

Chief executive of the group David Mackay said: "We feel that the EC has not fully recognised, in the level of this fine, their earlier acceptance that this was a mistake, not a deliberate transgression."

A spokesperson for research company Chart Track, which monitors the sale of games, said: "Prices of Nintendo games used to average 80 but now it's fallen to around 55, we have found."