Abstract
After VHS had won the format dumping war and subsequent intervention, an aftershock threatened all parties. The Korean invasion of the European market, accompanied by illicit imports from Japan, threatened a deceptive peace. By supporting an anti-dumping action, the Japanese government and industry agreed with the actions against Koreans and apostate Japanese VCR producers, which due to internal European Community industry politics coincided with the television and microwave oven cases. Finally, these cases resulted in measures that gave European production some breathing space. Philips and Grundig used the results for the reconstruction of their VCR business and became number one in European production. Copying of an alien commercial policy, Original Equipment Manufacturers (OEM) supplies, bolstered the leading position. Opposite to an export OEM policy, the application of this copy in the domestic European market requires, in order to prevent defections, price discipline among customers not accepted by some competitors. Efforts to correct the situation by an anti-dumping case failed. The Korean transfer of production to the European Community and collapse of Thomson’s VCR sales, foreshadow of an expectable final breakdown of this company, caused the failure of the proceeding.
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- 1.
The company Bondstech allegedly even received an investment subsidy from the Dutch government under the pretext of job creation in the assembly of VCRs. The company would soon disappear.
- 2.
Section 5.2 of Chap. 5 mentions the opinion of Mr. Morita of Sony in a meeting of Keidanren with the European Round Table of Industrialists in Rome in springtime of 1990 about the need to apply a COCOM, as applied toward Communist countries, to the Koreans.
- 3.
Many of the data are from market statistics that were made available by the French association Simavelec. Import statistics and export statistics are from Eurostat, Korean, Japanese, Hong Kong and Singapore official statistics.
- 4.
Source: Electronic Industry Association of Korea (EIAK), 2001 Statistics for Electronic Industries.
- 5.
Complaint made by the European Association of Consumer Electronics Manufacturers (EACEM) Against Imports of Video Cassette Recorders from Korea and Japan.
- 6.
This is according to the non-confidential file submitted by the European Association of Consumer Electronics (EACEM).
- 7.
Statistics of the Ministry of Finance of Japan, Eurostat, Import and Export Statistics and Transit statistics of Hong Kong and Singapore.
- 8.
Council Regulation (EC) No 384/96 of 22 December 1995 on protection against dumped imports from countries not members of the European Community (OJ L 56, 6.3.1996, p. 1) Amended by: the following Regulations No 2331/96 of 2 December 1996, OJ L 317 of 6.12.1996; No 905/98 of 27 April 1998, OJ L 128 of 30.4.1998; No 2238/2000 of 9 October 2000, OJ L 257 of 11.10.2000; No 1972/2002 of 5 November 2002, OJ L 305 of 7.11.2002; No 461/2004 of 8 March 2004, OJ L 77 of 13.3.2004; and No 2117/2005 of 21 December 2005, OJ L 340 of 23.12.2005.
- 9.
The texts of the Basic Regulations of 1984 and 1988 had this reference to discrimination.
- 10.
Chapters 15 and 16 dedicate ample attention to the issue of “Community industry”.
- 11.
Commission Regulation (EEC) No 2684/88 of 26 August 1988 imposing a provisional anti-dumping duty on certain imports of video cassette recorders originating in Japan and the Republic of Korea (OJ L 240, 31.8.1988, pp. 5–17), recital (8).
- 12.
Commission Decision of 12 December 1988 terminating the anti-dumping proceeding on imports of microwave ovens originating in Japan, the Republic of Singapore and the Republic of Korea (88/622/EEC).
- 13.
Probably based on artificial normal value as discussed in Sect. 16.10 (Chap. 16), taking cost of production plus the selling, general and administrative costs (SG&A) incurred by the majors in Japan as yardstick for normal value; an extremely unfair approach, supported by the Court of Justice.
- 14.
Funai produced mecadecks and made VCRs for domestic Japanese producers.
- 15.
Commission Decision of 12 December 1988 terminating the anti-dumping proceeding on imports of microwave ovens originating in Japan, the Republic of Singapore and the Republic of Korea (88/622/EEC).
- 16.
He also wanted price agreements and wanted the European Union to impose the High Definition Standard. He remained deaf to warnings that agreements on prices were forbidden, but also as history would demonstrate, that imposing a television system (HDTV) lacked a legal basis in the European Community and was an illusion.
- 17.
Price maintenance by producers is forbidden by what is now Article 101(1) of the Treaty on the Functioning of the European Union (“TFEU”). The existence of iR3 and the decrease in cost of production or relatively low cost were threatened by the prohibition. Dumping and price maintenance in the domestic market of dumpers and OEM is allowed, but the defence against that policy is forbidden.
- 18.
It took place in 1999.
- 19.
It was expected that at last the Commission of the EC wanted an end to these practices. Commission Decision of 1 October 1997 concerning aid granted by France to Thomson SA and Thomson Multimedia (98/183/EC), Official Journal L 67/31, 7.3.98.
- 20.
These are weighted selling prices by iR3 of various models supplied to OEM customers and compared with the prices of the same products of these customers in retail trade in Germany, as reported by GfK.
- 21.
Sources: iR3 and the Gesellschaft für Konsumforschung (GfK).
- 22.
An agreement to guarantee Grundig its profits had been concluded as part of the take-over deal with Max Grundig.
- 23.
- 24.
In 1994, Council Regulation (EEC) No 2176/84 of 23 July 1984 on protection against dumped or subsidized imports from countries not members of the European Economic Community, O J L 201, 30/07/1984 pp. 1–16 was applicable, with a similar text in its successor Council Regulation (EC) No 384/96 of 22 December 1995 on protection against dumped imports from countries not members of the European Community, which was replaced by the present.
- 25.
Darrot was gifted in confusing consumers. In Le Point of 4 May1996, he announced that design was essential and that he had made Philippe Starck designe for Thomson. The equipment did not sell and some went in stock clearance sales at prices even below those of more conventional Thomson equipment with identical specifications.
- 26.
La Tribune, September 1995. Darrot stated that the avant-garde products are not gadgets or whims of a designer, but are in the centre of the world war formation that takes place with Sony and Philips.
- 27.
Source: derived from the bimonthly retail reports of Gesellschaft für Konsumforschung (GfK).
- 28.
Industriemagazin, Sept. 1987, pp. 59–67: “Garcin is now having all other entertainment electronics equipment assembled in Thomson owned plants in the Far East (exception: video recorders manufactured in a joint venture with JVC in Berlin). His reasoning: ‘Hi fi, audio, and small TV sets can no longer be produced in Europe at acceptable costs.’” Finally, the VCR activities also went to the Far East, a wrong decision in a market needing quick response to changes in taste or short time to market.
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van Marion, M. (2014). Aftermath of VCRs: The Politicised End to a Continuing Story. In: International Trade Policy and European Industry. Contributions to Economics. Springer, Heidelberg. https://doi.org/10.1007/978-3-319-00392-4_10
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