Sony will appeal a fine for price fixing, after a French retailer said a Sony representative had branded its discounting practices "an act of terrorism."

Sony's French subsidiary will appeal a decision by the competition regulator to fine it €16 million (£11 million) for fixing retail prices, company spokeswoman Delphine Viers said today.

The Conseil de la Concurrence also fined the French subsidiary of Koninklijke Philips Electronics €16 million and Panasonic France, a subsidiary of Matsushita Electric Industrial Co, €2.4 million (£1.62 million). The fines represent 1 per cent of the companies annual revenues in France.

Representatives of Philips and Panasonic were not available to comment.

Price-fixing practices

The Conseil found that the three manufacturers had colluded with their distributors to fix the retail price of their products by withholding or delaying deliveries to retailers that stepped out of line.

The regulator began its investigation following a complaint from a discount electronics retailer, SARL Avantage-TVHA, filed in May 1998. TVHA said the manufacturers pressured it to raise its prices in line with other retailers in late 1997, after it advertised discounts of up to 20 per cent on televisions, video recorders, and HiFi products.

The Sony-gate papers

Sony's then regional sales manager described TVHA's discounting as "an act of terrorism" because of the effect it would have on profit margins in the sector, according to a transcript of a conversation with TVHA staff published in the Conseil's report on the case on Monday.

TVHA had a lawyer secretly record the meetings with the manufacturers, and supplied the recordings to the regulator. Transcripts of a number of the conversations appear in the 92-page report.

Viers declined to comment on the content of the report, saying that Sony would not comment on the case before its appeal had been heard.

The regulator also investigated Pioneer, Toshiba and Yamaha, but found insufficient evidence against them.

TVHA could not be contacted for comment.