Price Fixing Sell
Introduction
Price fixing involves a formulation of plan between two or more sellers. The main aim behind the Price fixing is to coordinate pricing in such a manner that the sellers obtain mutual benefits at the cost of buyers. In this process, the Sellers set a consensus to sell the product at the familiar target price by adhering to the common minimum price, purchase the product at a particular maximum price from a supplier and adhering to the list price. Apart from this, the seller engage in the activity of the mutual price advertising, employ consistent trade-in allowances and adhering to the sales term & antecedently-announced prices etc.
The sixth largest maker of the compact disks, Sony Music Entertainment, which is a subsidiary of the Sony Corporation of Japan have been charged of devious for keeping the prices of the artificially high in a court case that could have resulted in expenses to millions of consumers. Law firm in lieu of two CD buyers registered the lawsuit and succeeded in getting instant class-action status which infers that the other consumers of CD can also join. The case challenged the company for increasing retail prices of the CD, although modifications in manufacturing and other improvements have already reduced the cost associated with the making a CD (in 1983 $3 to $1 till now) (Six Makers of CD's Accused of Price-Fixing, 1996).
A Korean company which manufactures Dynamic Random Access Memory is Samsung Electronics Company Ltd. This company has been found guilty for indulging in the case of international conspiracy for fixing prices in the market of DRAM and is supposed to pay $300 million as a fine. It is supposed to be the highest antitrust fine in the history of U.S. This price fixing had a bad impact on the system of free market and suppressed the innovation. Apart from this, Samsung was charged for hauling out the conspiracy for taking active part in the discussions and meetings in U.S. related to the prices of the DRAM (Samsung agrees to plead guilty, 2005).
Therefore to safeguard the interest of the consumers, there is a need to take the strict actions against the practices of the price fixing.
References
Samsung agrees to plead guilty (2005). Department Of Justice. Retrieved September 9, 2008 from http://www.usdoj.gov/opa/pr/2005/October/05_at_540.html
Six Makers of CD's Accused of Price-Fixing (1996). The New York Times. Retrieved September 9, 2008 from http://query.nytimes.com/gst/fullpage.html?res=9905E5DA1139F933A25754C0A960958260
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